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TD Youth Account
$0
Minimum Balance
$0
Monthly Fee
An ideal way to help your children learn the benefits of saving.
TD Youth Account
Account Details
Account Type: Youth
Bank/Credit Union Name: TD Canada Trust
Key Infos
Enjoy the convenience of unlimited transactions with the perk of earning interest on your balance. Also offers no transaction fees no matter how many times you take money out of your account. Parents/guardians can set up a Pre-Authorized Transfer or Simply Save Program from their account into the TD Youth Account and Daily interest paid on every dollar.


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Performance Plan - Youth
$0
Minimum Balance
$5
Monthly Fee
Our most popular account offers unlimited everyday banking transactions for a competitive price.
Performance Plan - Youth
Account Details
Account Type: Youth
Bank/Credit Union Name: BMO
Key Infos
Our most popular account offers unlimited everyday banking transactions for a competitive price. It offers Unlimited Transactions per month. $4,000 Minimum balance to waive fee.

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BMO Rewards Points Program

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BMO Credit Cards

Plus Plan - Youth
$0
Minimum Balance
$0
Monthly Fee
A lower fee plan that is ideal for those with only moderate transaction needs. Additionally, this account provides free banking for kids, teens and students.
Plus Plan - Youth
Account Details
Account Type: Youth
Bank/Credit Union Name: BMO
Key Infos
The Plus Plan is a perfect lower cost option for those with only moderate transaction needs. It also makes a great first bank account for kids, teens or students, offering 25 transactions per month and no monthly fee for these groups.

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BMO Rewards Points Program

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AIR MILES®† Plan - Youth
$0
Minimum Balance
$15.95
Monthly Fee
Get AIR MILES Reward Miles with unlimited everyday banking transactions, and add additional accounts at no extra fee.
AIR MILES®† Plan - Youth
Account Details
Account Type: Youth
Bank/Credit Union Name: BMO
Key Infos
Get AIR MILES®† Reward Miles on your everyday BMO Debit Card purchases with a BMO AIR MILES Chequing Plan. With multiple ways to get Miles, everyday banking has never been this rewarding! Offers Unlimited Transactions per month.
  • 1 Mile per $30 spent on debit purchases
  • N/A Minimum balance to waive fee 

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BMO Rewards Points Program

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Practical Plan - Youth
$0
Minimum Balance
$4
Monthly Fee
A low fee chequing account for basic banking needs, including 12 transactions per month
Practical Plan - Youth
Account Details
Account Type: Youth
Bank/Credit Union Name: BMO
Key Infos
The Practical Plan is a low-cost option that offers 12 transactions per month, and only costs $4.00 if that’s all you use. Enjoy unlimited Interac e-Transfer® transactions and mobile cheque deposit with any BMO plan.
  • Free Premium Rate savings account
  • N/A Minimum balance to waive fee

Other relevant BMO Topics

 

BMO Rewards Points Program

Air Miles Points Guide

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Getting There Savings Program for Youth
$0
Minimum Balance
$0
Monthly Fee
Start building healthy financial habits early
Open Account
Open Account
Getting There Savings Program for Youth
Account Details
Account Type: Youth
Bank/Credit Union Name: Scotiabank
Key Infos

Getting There Savings Program for Youth offers no monthly fee.  Must be 18 years old or younger. It's a free paperless or paper statements.

Start building healthy financial habits early.

Top features:

  • Unlimited debit transactions
  • 2 free Interac e-Transfer transactions per month
  • Your choice of SCENE Rewards or Scotia Rewards
  • Earn 0.05% interest on deposits up to $499.99
  • Earn 0.10% interest on deposits of $500 or more

 

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What is a Savings Account?

A savings account is a bank account that pays interest on your deposits. They’re available through the Big 5 banks and online-only self-serve banks.

 

Savings accounts aren’t for your daily transactions (that’s what chequing accounts are for). And they aren’t for long-term goals like retirement. Instead, they provide a safe and accessible place to stow and grow your money in the short term.


Why Use a Savings Account?

 

Here are a few reasons you might use a savings account:

 

Makes Saving Easier

The main reason to use a savings account is to, well, save!

 

Think about how hard it would be to save money if you only used your chequing account. All your money would be lumped together; you wouldn’t know what was for spending and what was earmarked for saving.

 

It makes much more sense to separate your funds. Money for bills and spending should go into a chequing account, and money dedicated to savings goals should go into a savings account. This makes it easier to manage your finances.

 

Savings accounts are best for short-term savings goals and for money you might need to access quickly. Examples include:

  • An emergency fund
  • A vacation
  • A down payment on a house or car
  • A bigger purchase like a furniture set or a new computer



Helps Grow Your Money Faster

Savings accounts aren’t just for organizing your money. They also help you make money, by paying interest.

 

Savings accounts pay a set interest rate on your deposits. Many accounts calculate your interest daily and pay it monthly (but check your terms to be sure). This is ideal because it leads to a magical thing called compound interest.

 

What is compound interest? It’s when you earn interest on interest. It’s easiest to illustrate with an example:

 

Say you have $1,000 in a savings account. The interest rate is 2% annually, and interest is calculated daily and paid monthly.

 

2% divided by 365 yields a daily interest rate of 0.005479%.

 

$1,000 x 0.005479% = $0.05479 in daily interest. So each subsequent day, your interest is calculated based on your initial $1,000 plus that $0.05479 you earned the day before. Your interest is earning interest! At the end of the month, you’ll get an interest deposit for $1.67.

 

Some accounts pay a higher interest rate when you maintain a minimum balance. Others offer special introductory rates for new customers. Taking advantage of these offers is a great way to grow your money faster.

 


Offers Security and Peace of Mind

It’s no secret that interest rates on savings accounts are low compared to the returns you might earn by investing in the market.

 

However, the potential for a higher return comes with the potential for loss. That kind of volatility is unattractive when you need your money in the short term or are uncomfortable with risk.

 

Think about it: how would you feel if your emergency fund took a 20% hit tomorrow?

 

Unlike mutual funds, ETFs, and stocks, savings accounts are risk-free. The value of a savings account will never decrease—there’s no risk of losing your principal. Even in the extremely unlikely event that your bank goes under, your funds are safe. This is because they are typically insured against loss by the CDIC (Canadian Deposit Insurance Corporation).

 

CDIC insurance covers deposits at member institutions up to $100,000 per insured category. Accounts held in just your name are insured separately from joint accounts. This means you can have up to $100,000 of insured funds in your account, plus another $100,000 in the joint account you share with your spouse, plus another $100,000 in the account you share with your child, etc.



It’s Accessible

Although savings accounts may not be as accessible as chequing accounts, your funds are never locked in and you can access them any time (although this might impact bonus rate offers). This isn’t the case with some other savings vehicles, like non-redeemable GICs. This is another reason savings accounts are great for short-term savings.



Drawbacks of Savings Accounts

 

As previously mentioned, savings accounts are often less accessible than chequing accounts because they may not be linked to a debit card or include cheques. There may also be fees attached if you do multiple withdrawals a month.

 

The main drawback of a savings account is that funds left there for a long time might not keep pace with inflation.

 

Again, savings accounts are not for long-term savings goals. The danger in treating them this way is that your money will lose spending power if the interest rates don’t match inflation rates.

 

The second drawback is that interest earned on a savings account is taxable. Your bank will send you a T5 slip and you’ll have to report it as income when you file your taxes. If you have the contribution room, holding a savings account within a Tax-Free Savings Account solves this problem.



Savings Account Pros and Cons

 

Pros Cons

·       Facilitates saving 

·       May be less accessible than chequing accounts

·       Helps grow your money

·       May not keep pace with inflation

·       Safe and secure

·       Interest earned is taxable

·       More accessible than other investments

 



Types of Savings Accounts

It used to be that the Big 5 banks were consumers’ only options for getting any kind of bank account. They offered a few different savings accounts, including options for kids.

 

Now, Canadians have more options than ever before. Online-only banks offer self-serve accounts with attractive interest rates—perfect for people comfortable with online banking.

 

For those who prefer a brick and mortar bank presence, traditional banks still have you covered.

 

Here are a few types of savings accounts available to meet your needs:



Traditional Savings Accounts

These basic savings accounts are usually offered by traditional banks and pay a low interest rate. The benefit is that there’s face-to-face service if you need it, and you can usually use a debit card to access a network of ATMs.



High Interest Savings Accounts

Offered by online banks and traditional banks, these accounts pay higher interest rates. Online banks tend to offer the best rates, and you’ll often see introductory offers. For example, you might earn a special rate for the first six months. Sometimes offers depend on making a minimum deposit or maintaining a minimum balance, so make sure you understand the terms.

 

Online high interest savings accounts may not link to a debit card, so you need to be comfortable with online or mobile banking to make the most of them.

 

Tiered Savings Accounts

These accounts offer different interest rates based on your balance. The more you have on deposit, the higher your rate.

 

Kids’ Accounts

Starting a savings account for your kids is a great way to teach them about money. Most traditional banks offer free interest-bearing accounts for children that may include several withdrawals a month.

 

U.S. Dollar Savings Accounts

Many banks offer U.S. dollar savings accounts for people who want to stash U.S. funds for an upcoming trip. This makes it easy to watch the rate and buy funds online when it’s favourable. Note that U.S. accounts are not CDIC-insured.

 

How to Open a Savings Account

You can open a savings account in person at a traditional bank or online. You’ll need to provide your:

  • Name
  • Address
  • Telephone number and email address
  • Date of birth
  • Occupation
  • Social Insurance Number (so the bank can issue a T5 for tax purposes)

 

If you open an account in person, you’ll need two pieces of valid ID (see ID requirements here). For online applications, you might be asked to provide ID details, like your driver’s licence number.