Savers Roundup May 2020: a minimum 2.00% return is what you should be getting

The slow but steady downward march for interest rates

Relative to previous months, it’s been quiet for savings account interest rate changes lately. Over the past month, we’ve seen savings account interest rate decreases at Alterna Savings, Ideal Savings, Motive Financial, motusbank, and Wealth One Bank of Canada. There was even an increase in rates at Canadian Tire Bank.

Our comparison chart still has 13 out of 17 financial institutions with rates of 2.00% or more.

Frequent GIC rate leader Oaken Financial decreased its GIC rates several times over the past few weeks. In general, the spreads between a given financial institution’s 1-year and 5-year GIC rates have been getting smaller. The current top rate on our GIC comparison chart for a 1-year term is 2.15% at Hubert Financial, and the 5-year term leaders are Peoples Trust and Oaken Financial, both at 2.40%.

Luminus Financial actually has better GIC rates across the board than any other bank on our chart, but be sure to review their fees, which are reportedly higher than others.

Promotions to get you through the next few months

If you don’t mind moving your money around, you might find these short-term promotions tempting:

• Manulife Bank: 2.60% for the first 5 months if you open an Advantage Account before May 22, 2020. Unlike other financial institution savings account promos, the 2.60% rate is not guaranteed, and will drop if their base rate drops.
• RBC Royal Bank: 2.25% for the first 3 months in a new RBC High Interest eSavings account
• Existing Tangerine Bank customers: Targeted 2.50% new deposit promo for 5 months starting May 1, 2020
• New Tangerine Bank customers: 2.80% savings account interest rate for the first 5 months
• Scotiabank: up to $300 cash for opening an Ultimate Package or Preferred Package chequing account

More news: your taxes are almost due; coming soon for Hubert Financial; a caution on Credit Verify

• The delayed personal income tax filing deadline of June 1, 2020 (with September 1, 2020 as the deadline to pay any amounts owing) is fast approaching. If you still haven’t done your taxes, you might be interested in our 2019 survey of Canadian personal income tax filing habits, and review of free Canadian income tax software options
• Hubert Financial has unveiled its customer roadmap: two-factor authentication and online user interface improvements (including setting GIC maturity instructions online) are coming; no plans for chequing accounts or Interac e-Transfers
• Beware of using Credit Verify to check your credit score