EQ bank: 3.00% with TFSA and RSP | EQ Bank | Discussion forum

That is enough to go against other 3% competitors because their TFSA is still free to transfer out.

Alexandre said
3.00% is not bad for regular interest rate these days. I plan to use that to full extent of my TFSA contribution limits.  

Re: TFSA, I would just say, I'm skeptical of their "playbook". Ie; are they setting up to capture people's cash in January and then a few months later, make themselves noncompetitive again, knowing people generally won't pull funds out until late in the year because of tax.... Hmm, its December, maybe also its to try and retain funds people are planning to withdraw because of the rates they have had for months.

Got 'burned' this way by CT Financial 2 years in a row back in the early days of TFSA.

I'm always wary when the regular HISA doesn't have the same rate, because I ask what is the real reason.

I call those new customer promo rate for any registered account (esp TFSA) a sucker rate, esp if coming from the big banks.

Unless BoC starts cutting rate, 3% HISA should be pretty sticky for the next little while IMHO

Loonie said
EQ hasn't even bothered to guarantee the rate for a few months this time. Even though transfers are free, there will be delays.
My advice?: Avoid!  

Why should EQ guarantee the rate? Most other FIs do not guarantee the rate.
EQ is not the highest but it is certainly not the lowest either at 3.0%. I believe Doug's analysis in another thread indicated that EQ was run very efficiently. Personally I like EQ's interface, allowing a large number of external linked accounts and ease of moving funds in and out, free interac etransfers and NO service charges at all. No FI is perfect for every person, but EQ is pretty good compared to others.

I've used EQ on and off pretty regularly since day one, very easy to use, no issues, works very well for my needs. Couldn't care less about them not offering joint accounts, negligible impact on my assessment of EQ. Right now we have some in TFSA GICs, I'm not averse to pulling it out when it matures if their rates are not competitive, just recontribute it somewhere the next year, i.e. some folks seem to forget you can just withdraw your TFSA money, no need to be trapped.

Loonie said

As a consumer, I pursue what's best for me. In a savings account, EQ is competing against promos that do offer guarantees for X months/days and pay much better. With RSP/TFSA season fast approaching, they are simply trying to get ahead of competitors, hoping we will plunk our money down and forget about it.

We haven't found a use for our EQ accounts for a long time. We have always found something that's better for us.  

I have not had a TFSA since the fall of 2022 - the TFSA cash was completely withdrawn and used for another purpose. I think I may start/restart a TFSA - January 2023 - so which FI would you recommend? I could do either a HISA or GIC or a combo of HISA and GICs. What recommendation would you make for an FI for a TFSA lump sum contribution to be put starting in Jan 2023?

Thank-you dougip - you raise some good points. I agree that it is better for the TFSA to invest in interest bearing instruments since one would get high interest while avoiding the higher tax on that interest if it were outside the TFSA.

As far as GICs, there are some FIs that allow short term under one year GICs eg EQ, Hubert (with its quarterly cashable Terms) and perhaps others. So several short term GICs eg 3 month, 6 month, 9 month etc. would avoid being locked in for a full year and become available to reinvest if rates go up.

Your thought about the ISA is interesting too - and worth consideration - I know since at iTrade the DYN6004 ISA earns over 4% now and might go higher in 2023 - and it is covered by CDIC and there is flexibility to move that cash into other instruments which might become attractive at the time.
Some good information to think about. Thx.

Loonie said

I'm not sure if you really want my opinion, but I'd wait to see what is available in January and February.
I don't think it's worth it to deposit it somewhere and then expect to transfer it in short order early in the year when something better comes along. Transfer times at that time of year are unreliable, and then you miss the longer-term deal elsewhere. I'd happily sacrifice the tax saving for a short time until I saw what the TFSA GIC landscape looked like in the new year. If a great deal came up in the first week of January, I'd take it! But I'd also be willing to it a few weeks since I've learned from experience that the FIs that trot out their deals early are often not the best ones and best deal may come in February.  

Sure. I can't redeposit (to TFSA) until January 2023 at earliest - it does not take more than a few days to transfer in. The funds are presently earning 4.5% (but in a taxable non registered HISA) so perhaps that works out not much different than a TFSA HISA @ 3% non taxable. I am in no panic to move to TFSA if I still get 4.5% in HISA although it is taxable.

Interest rates CAN drop suddenly and precipitously.
If your goal is a GIC, I recommend keeping the money accessible at an FI that has chequing option for immediate deposit. This wouldn't work for an EQ GIC, but the only thing that works for an EQ GIC in a hurry is to keep your cash at EQ, for which the current non-registered rate is 2.5%; and, even then, no joint GICs.
If you find that attractive, it's all yours!