Best high interest savings account

[Big Racks]

We've sold our house in Beaumont and are relocating to Calgary. I have up to 2 years to buy in my new location with the company still covering my costs, so we're planning on parking the equity for now, renting a place and waiting for the right house to come along. We close on July 26 so I have a little research time still to decide.

So, if you wanted to park ~150k somewhere for up to 2 years, but still have access to it (ie: not locked in), where would it be? Lots of so called HISA's out there, with the majors all sucking to be honest. Don't care about storefront vs online, not too concerned about transaction fees as we won't be making many, and the amount involved should suffice for minimum deposit amount. What do you use, or what have you used, and were you happy?

[jungleboy]

TFSA is the best ,you won't pay tax on the interest. I know it's limited but shelter what you can. Any interest account will penalize you on the transactions and you won't make any interest at all if make a withdrawal.

[fishtank]

manulife has a 3% account , also look into the tfsa and park it on a bank stock for dividend, better then interest they paid .

[Big Grey Wolf]

I park a lot of our savings in Canadian Western Bank and Servus Credit Union. They both pay best interest rates on GIC's. I do not like other banks as they want to use your money, pay 2% or less then charge you 20% to get your own money back on a credit card.

[Au revoir, Gopher]

If you are not looking for a TFSA, check out Bridgewater, they are currently paying 2.35%. They are a little old school, you deal with them by phone, snail-mail, or in person and they only have one branch (in Calgary).

Manulife's 3.25% is a 6 month promotional rate, it reverts to 1.5% after the 6 months.

You could always park it at Manulife for 6 months and then move it to Bridgewater.

ARG

[Colin_r6]

Yep, i'd go with TFSA as well. Max out yours and your spouses into an Investment TFSA and find a couple nice Dividend Stocks.

Crombie Real Estate fund and H&R Real Estate investment trusts are good ones. Nice high monthly dividends.

Thats $63500 each. $127000 into HR.UN would be 5469 shares - translating to about $625 a month.
Parking that for 2 years gets you north of $15000, not including any gains or losses in the actual stock itself (which doesn't fluctuate that much on HR.UN).

And the best part - Justin doesn't get to put his greasy little mitts on any of that $15k.

[Big Racks]

Thanks for the advice guys. Will definitely look into a TFSA for both of us, we've never contributed so like Colin said, looks like we'll have 127k in contribution room between us.

My only real criteria is these funds have to be accessible. We could come across a house we want to buy in the first couple of months, or it might take the full 2 years, but either way the funds can't be locked in at all.

[skidderman]

EQ bank. Can get the funds out any time you wish.

[Nova316]

TFSA into safer dividend funds would be the best. You can access your funds at any time by selling the shares and pulling out the money. Just remember you won't be able to top up till the following year. I have money invested in EIT.UN and DGS, I like EIT.UN as it's more stable then DGS

Of course do your DD don't listen to random internet people!

[booboo74]

Be warry, if you're going to be close to your TFSA limit and on any dividends earned in a TFSA trading acct (if you chose that route)

[Dean2]

You only have a 2 year investment horizon and you may need the money far sooner than that if the right deal pops up. DO NOT buy mutual funds or stocks with that short a time line. Over 10 or 20 years, the market will go up and so will most investment in it, over 2 months to 2 years just as likely to go down as up so whatever it pays for dividends could easily get wiped out. Dividends to about $40,000 each, even outside of a TFSA or RRSP, are basically tax free or very low tax depending on your income bracket, so for longer term investment they are a good option.

Most places charge an admin fee to setup then collapse a TFSA, some aren't much but make sure yo know what they are as there are places that charge 2% to collapse one open less than a year. Also check out the annual admin fee. Finally, make sure the TFSA you set up has access to the high interest savings accounts you are looking for, many do not allow TFSA as one of the deposit options. Even 4% interest on 150K is $6,000 a year but the tax will take about $2,400 to $3,000.

6 months at Manulife followed by moving it to a Credit Union, ATB or whoever else has a bonus interest deal on the go will give you the most flexibility with no risk to your capital.

[The Cook]

We parked 90k into special offer from CIBC savings acct @ 3% for 6months and then put into two tfsa's (locked for a year) @ 2.5%.

[bschlinker]

OP - I would agree a HISA might be your best option, but I would also recommend splitting the amount equally into two separate accounts / institutions. This will ensure the full ~$150k is covered by CDIC insurance.

I’ve included a link for comparing highest HISA accounts and explanation on CDIC insurance below:

https://www.ratehub.ca/savings-accou.../high-interest
https://www.cdic.ca/about-deposit-insurance

Hope this helps,
B.