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The new Hubert Financial has almost arrived

Following the 2022 merger of Access Credit Union (the parent of AcceleRate Financial), Noventis Credit Union, and Sunova Credit Union (the parent of Hubert Financial), the merger of the beloved online divisions are upon us. Starting on September 22, the AcceleRate Financial brand will be retired and merged into Hubert Financial.

The new Hubert Financial will see a whole raft of changes. Some of the changes are good, such as free Interac e-Transfers and the addition of mobile cheque deposits. Also, the popular 1-year quarterly redeemable GIC is staying. However, at least for the time being, there will be no more ability to transfer funds to/from external accounts (from within the Hubert online interface) and no more self-serve option for GICs within online banking.

All prepaid roads lead to KOHO… or EQ Bank or Wealthsimple

First Mogo and now STACK. After becoming significantly worse, the STACK Prepaid Mastercard has fully shut down (as of September 11), and is directing all users to KOHO. When it comes to prepaid cards, KOHO isn’t the only game in town, as EQ Bank and Wealthsimple have somewhat similar offerings. These prepaid cards combine some features of a credit card (including cash back rewards) and some features of a standard bank account (including a decent interest rate on your savings), thus sitting in an interesting category of their own.

If you’re willing to pay a monthly fee, the $9 and $19 KOHO plans offer no foreign currency exchange transaction fees, and the $19 plan also offers a 4.5% interest rate on your entire balance. 4.5% would be the highest non-promo rate on our savings account comparison chart but of course you’ve got to get out your calculators to factor in the monthly fee.

More 6.00% rates

In our last Savers Roundup, we highlighted Simplii Financial’s 6.00% rate (for 5 months) for new customers. Since then Tangerine Bank has come out with several 6.00% rates:

• New customers get 6.00% for the first 5 months
• Some existing customers are now getting 6.00% on new deposits in the latest targeted promo
• New and existing customers can get 6.00% on an 18-month GIC

Elsewhere, you can get nearly 6.00% at a few other financial institutions, including but not limited to:

• Wealth One Bank of Canada has 5.98% 1-year and 18-month GICs until October 31
• Meridian Credit Union is offering 5.75% for the first 5 months in a new savings account
• Motive Financial has a 5.75% 120-day GIC on new money

In related news, three founding investors of Wealth One Bank of Canada have been ordered to sell their shares.

This time last year, we wrote that 5.00% was the new 4.00%. Looks like the new benchmark is 6.00%.

If you’re not yet a Simplii Financial customer, you can get 6.00% for the first 5 months in their savings account. This handily beats other new account offers such as BMO’s 5.00% savings account offer, and narrowly tops Tangerine’s 5.75% savings account offer. Among the other promotions listed on our website is DUCA Credit Union’s 5.25% interest rate on new deposits to an Earn More Savings Account, which has been extended until January 31, 2024.

Tiered interest rates

Are tiered savings account interest rates becoming a thing? Last month, Simplii Financial introduced a higher rate (which is now 5.50%) for all customers with balances above $1 million. Now, Laurentian Bank is offering 4.00% for balances between $100,000 and $5 million. If you have less than $100,000, the interest rate is 3.00%.

Decent rates for everybody else

Over the past month, 7 out of the 19 accounts we track on our savings account comparison chart increased their rates. Perhaps more notably, Ontario-only Saven Financial has launched a TFSA with a 4.00% interest rate, although that still trails Motive Financial, whose regular savings account and TFSA interest are both at 4.10%.

Canadian Tire Bank, which is one of the most infrequent rate changers on the savings account side, has increased its regular savings account and TFSA interest rate from 3.00% to 3.50%. Its GIC rates continue to change several times per week – such a high frequency is unheard of at the other financial institutions we track. The GIC rate leaders are generally LBC Digital, Motive Financial, and EQ Bank, which have all seen recent rate increases. The top non-broker rates on our GIC comparison chart are:

• 5.60% for a 1-year GIC
• 5.60% for an 18-month GIC
• 5.65% for a 2-year GIC
• 5.35% for a 3-year GIC
• 5.10% for a 4-year GIC
• 5.10% for a 5-year GIC

The Bank of Canada just made another 25 basis points increase to its key interest rate, which now sits at 5.00%. This is the highest it’s been in over 20 years. We were just catching up from a similar increase in June…

The best rates for savers are in short-term GICs

Short-term GIC rates are the highest they’ve been in years. On our GIC comparison chart, both LBC Digital and Motive Financial are offering a 1-year GIC at 5.60%. Tangerine Bank has an 18-month GIC at 5.50%. This continues a trend where the longer terms have lower rates.

Bank of Canada interest rate decisions: savings accounts are still catching up

Suffice it to say, savings account interest rate increases have not kept pace with the Bank of Canada’s increases. As an example, Achieva Financial just increased its regular savings account interest rate from 3.50% to 3.60%, following an increase of 0.10% last month as well. EQ Bank’s current 2.50% rate has not changed since October 2022, and Alterna Bank’s current 2.25% rate is actually down from where it was last December!

That said, savings account interest rates are still going up in general, and we should expect to see more rate increases in the coming weeks. Motive Financial still leads our savings account comparison chart with a regular savings account and TFSA interest rate of 4.10%. You can get even better rates through a brokerage investment savings account.

Not a promo rate if you have $1 million

If you have over $1 million, you can get 5.25% at Simplii Financial as a non-promotional rate. But, if you have under that amount, you will get 1.00% or less.

Back the land of promotions for the rest of us, Tangerine’s latest targeted 5-month new deposit promo for existing customers is now at 5.50% between July 4 and November 30, 2023.

BMO is also getting in on the action. Its new account promo is now for up to $450 when you open a Performance Chequing Account, and a 5.00% promotional interest rate when you add the Savings Amplifier Account. (Conditions apply.)

Boos

• Plastk Visa Credit card holders are out thousands of dollars
• DUCA Credit Union has quietly introduced a $4 monthly charge or a $1,000 minimum balance to its “no-fee” chequing account
• Laurentian Bank has started a strategic review that might lead to a sale of the bank! That is likely the cause of LBC Digital recently shutting off new sign-ups.

The rate hikes are back. In January the Bank of Canada decided to “pause and assess”, saying that it was a conditional pause:

If new evidence begins to accumulate that inflation is not declining in line with our forecast, we are prepared to raise our policy rate further.

Now we know that the Bank of Canada did not like what it saw in its assessment (including the rate of inflation turning back up), because last week it raised the key interest rate once again.

Savings account interest rates were starting to decrease, but now rate hikes are back in savings account land too. Outlook Financial increased its regular savings account and TFSA interest rate from 3.40% to 3.55%, and Achieva Financial (from 3.40% to 3.50%) and Peoples Trust (from 3.00% to 3.15%) had a similar increase. Other financial institutions on our savings account comparison chart might soon follow.

Competition is slowly heating up again for GICs, mostly in shorter terms, where Peoples Trust currently leads for a 1- or 2-year term at 5.25%. If you’re a Canadian business, keep an eye on fintech upstart Vault, which is now offering business GICs, including a 5.10% 2-year rate.

Promos give you 5.00% or more

5.00% is still the standard for savings account promos.

Manulife Bank is now offering 5.00% for 120 days in a new, non-registered Advantage Account opened between May 24 and July 31, 2023. Some existing customers have reported a similar promo for new deposits on existing accounts as well.

New Tangerine Bank or Simplii Financial customers can get 5.25% for 5 months in a savings account. The latest targeted promo for existing customers at Tangerine Bank is 5.25% between June 7 and October 31, 2023.

Closing time, decreasing support, and direct deposit error

• LBC Digital is no longer accepting new account sign-ups. If this is permanent, this marked less than 4 years since LBC Digital launched.
• Last year, Hubert Financial dropped customer support on Sundays. In a couple of weeks, there will be no more Saturday support either.
• What happens when a CRA direct deposit is to the wrong account?

Motive Financial already had the top regular savings account interest rate on our comparison chart but widened its lead even further on April 17 with an increase from 3.80% to 4.10%.

Elsewhere, we’ve seen only decreases, which marks a definite trend:

• MAXA Financial from 3.35% to 2.95%
• Saven Financial from 3.75% to 3.50%
• AcceleRate Financial and Hubert Financial from 3.35% to 3.30% (and from 3.45% to 3.35% for their TFSAs)
• Ideal Savings TFSA from 3.75% to 3.55%, although that’s still the highest TFSA interest rate on our chart

Promo rates are still holding up, where the usual two-some of Simplii Financial and Tangerine Financial continue to offer 5.00% or more to a select group of Canadians.

• Simplii Financial new customers: Earn 5.25% interest for 5 months on your first Simplii Financial High Interest Savings Account
• Simplii Financial’s targeted 5-month new TFSA deposit promo for existing customers: 5.00% between May 1 and August 31, 2023
• Tangerine Bank new customers: 5.00% savings account interest rate for the first 5 months if you also open a chequing account with the promo code “EARNMORE”
• Tangerine targeted 5-month deposit promo (new or all deposits, depending on the offer) for existing customers: 5.00-5.25% between April 13 and August 31, 2023

DUCA Credit Union (Ontario-only) is offering a 4.75% new deposit promo on its Earn More Savings Account until August 31.

On our GIC comparison chart the shorter terms are still offering a higher rate than the longer terms. The highest 1-year GIC rate is currently 5.15% at Wealth One Bank of Canada or 5.50% through a GIC broker. The highest 5-year GIC rate is currently 4.72% at Motive Financial or 5.32% through a GIC broker.

Lastly, the personal income tax filing deadline has passed, but are you still waiting on your CRA refund? You’re not alone!