Want to take advantage of rising interest rates? Open a new savings account

I opened a savings account the other day with a new player called Saven Financial that pays 2 percent. It took me about two minutes to get the account up and running and another couple of minutes to download and enable the Saven mobile app.

That’s the effort required to capitalize on the happy side of rising interest rates. The latest generation of alternative banks and credit unions have an online account application process that almost instantly gets you a working account and online application.

You’ll still have to deal with the pathetically slow flow of money between banks, up to five days, Saven advises. But starting your way to the highest rates can be just minutes away.

As part of my job, I have opened accounts with a wide variety of online banks. Saven was added to the list because it’s new and had the best high-interest savings account rate recently. Find the highest rates for yourself by trying these three resources:

1.) HighInterestSavings.ca – A database of alternative banks and credit unions offering the best rates. Click on the “Rates” column header and get all the listed players ranked from best to worst rate. That’s how Saven’s 2 percent rate got ahead of a pack of competitors offering 1.5 to 1.7 percent. This website also has an excellent GIC fee database.

2.) Cannex: A broader comparison of savings rates that includes the big banks. Some newer players like Saven and motusbank are not on the list.

3.) Your bank: Big banks rarely rank among the rate leaders, but they have been offering unusually good bonus rates on GICs and temporary promotions on savings. For some people, the convenience of dealing with their regular bank makes up for not getting the best rate.

High rates don’t add risk on savings and GIC accounts if you’re covered by deposit insurance. Banks must be members of the Canada Deposit Insurance Corp., while credit unions offer their own provincial deposit insurance plans.

Of course I took a look at Saven. It is a division of FirstOntario Credit Union, which is insured through the Ontario Financial Services Regulatory Authority. Under this plan, unregistered deposits are covered up to $250,000, while coverage for registered deposits such as RRSPs and TFSAs is unlimited.


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Rob’s Personal Finance Reading List

Three clever ideas for your HELOC

Good old-school advice on your home equity line of credit in light of rising rates. Use it for a reindeer home? No, guess again.

Autopilot ETFs for Retirement Investing

A look at a new exchange-traded fund option for people building their investments for retirement: target-date funds that automatically adjust your asset mix to become more conservative as you age.

Coping with the cost of having children

An interesting Reddit discussion sparked by this question: “How much did the finances of having children affect your decision to have them or not?” For my wife and I, the answer is not at all. We bought a first house and started a family in the mid-1990s. Back then, both kids and houses were routine for young adults early in their careers. Now not so much.

The cheapest house in the Toronto area for sale

Well, it’s a renovated caboose, not a house, and it’s not connected to any water or sewer lines. But what did you expect for an asking price of $45,000?


Questions and answers

Q: Is it better to wait until age 70 to start taking CPP?

A: Here are some of the most recent stories we’ve published on this much-discussed topic:

Should retirees battling skyrocketing inflation delay taking CPP until age 70?

Few older Canadians are deferring retirement benefits, when doing so could mean tens of thousands of extra dollars

The case for deferring your CPP benefits is stronger than ever

Do you have any question for me? Send it my way. Sorry I can’t answer each one personally. Questions and answers are edited for length and clarity.


Today’s financial tool

A series of videos for novice investors on basics like risk, diversification, fees, and more. From the BC Securities Commission.


The Money Free Zone

I just heard the Chambers Brothers record from 1966. The time has come today for this first time… and the second and the third. 60’s soul fans, that’s how good it is. Here’s Chambers’ signature song, The time has come today.


What I’ve been writing about

More Rob Carrick coverage and money

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