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Earn high everyday interest rates with the Scotia High Interest Savings Account
Key takeaways:
Whether you're saving for short term goals like home renovations, building an emergency fund for an unpredictable future, a savings account is a great option to park and grow your money while you work toward your financial goals. A high interest savings account (HISA) provides the added benefit of typically earning a higher interest rate on your savings than other types of savings accounts.
In this article, you’ll learn how a savings account works, the different types of savings accounts available, and how a high interest savings account can help you achieve your financial goals faster.
A high interest savings account is a type of account that typically offers a higher interest rate than traditional savings accounts. This means your money earns more just by sitting in the account — no extra effort required. HISAs are a good option for short- or medium-term savings goals, such as building an emergency fund or saving for a short term goal like a car..
Unlike a Guaranteed Investment Certificate (GIC), a HISA typically doesn’t tie up your money for a fixed term. One thing to note though is that some accounts do have holding periods but this will depend on the individual product, so carefully read the account terms when signing up. Plus many HISAs come with extra perks like no monthly fees and no minimum deposit required.
Best of all, HISAs share the benefits of other savings products. Your savings grow in a low risk environment, making it a good way to put your money to work and stay ahead of inflation.
A high interest savings account works by paying you interest — often calculated daily and paid monthly — on the balance you keep in the account. Thanks to the magic of compound interest, the more you save and the longer you leave it untouched, the more interest you earn. It’s a simple, low-maintenance way to build your savings over time. It’s like getting paid to save!
Most HISAs offer variable interest rates, which means the rate of interest can go up or down based on market conditions, the current rate set by the Bank of Canada or the financial institution’s policies.
With the Scotia High Interest Savings Account, you’ll be able to earn higher interest rates than with a regular Scotia savings account, depending on the total balance that you hold with Scotiabank (to earn interest, you’ll need a minimum balance of $10,000 CAD across your eligible accounts). Your interest rate is based on your Total Relationship Balance1.
What’s a Total Relationship Balance?
Your Total Relationship Balance is the combined daily balance in all your eligible accounts, including eligible Scotiabank chequing accounts, savings accounts, guaranteed investment certificates, and mutual funds available through Scotia Securities Inc. You’ll need the minimum Total Relationship Balance to earn interest on your HISA. The higher your Total Relationship Balance, the higher your interest rate that Scotiabank will apply to the funds in your Scotia HISA (up to the set maximum interest rate). This can help you reach your savings goals faster.
Visit scotiabank.com/totalrelationshipbalance to view all “Eligible Accounts” included in your Total Relationship Balance.
This combination of competitive interest rates, flexible access to your funds, and minimal risk makes a HISA an attractive savings option.
Open a savings account online or in branch
You can open a savings account online or by making an appointment at a local branch, whichever way is more convenient for you. While your money is sitting in your account, it will start to accumulate interest (if you are eligible).
A HISA offers many useful benefits, including:
Safety: CDIC insurance protects your deposits if your financial institution fails (goes bankrupt). Putting your money in a savings account is much safer than stuffing it in a cookie jar or under your mattress because it's insured by the Canada Deposit Insurance Corporation (CDIC).
Liquidity: Compared to putting your money in a GIC, a savings account allows you immediate access to your money should you need it.
Interest: Putting your money into a HISA allows you to earn more passive income through interest than you would with a regular savings account. Interest is the amount a lender charges to loan money. Or, in this case, the interest rate is the amount of money you're awarded for saving your money in a HISA. The interest rate you earn can vary based on where you save your money, how much you save and how long you save. With the Scotia HISA, your interest rate is based on your Total Relationship Balance.1
Reduce temptation: Putting your money into a savings account can help reduce the temptation to spend. Automating your savings (even a tiny amount per week), will eliminate any temptations altogether and will give you that feeling of accomplishment each month when you check your balances.
Preparation: Using a savings account to grow an emergency fund is a great way to prepare for the unexpected.
Organization: Some savings accounts allow you to organize your money into different buckets so you can clearly define your individual savings goals and fund them accordingly.
Beyond a high interest savings account, there are a variety of savings accounts you can use. The one that's right for you will depend on your specific needs and savings goals. Your financial situation may change from one life milestone to another, so reassess regularly to ensure you have the best financial product mix at your disposal. Regular savings accounts
Get started on putting money away for your goals with a savings account, like the Scotia Money Master Savings Account. A savings account is a great way to store money safely and accessibly. You can easily transfer money between accounts at the same financial institution online, over the phone, through the bank’s app or at a branch. Unlike a chequing account, a savings account is generally not used for everyday transactions, like paying bills or cashing cheques as they often include fees for these types of transactions.
Automate your savings with Scotia’s smart saving tools — Pay Yourself First and Savings Finder can help you put your savings on autopilot. These tools can help you reach your goals by automatically moving small amounts of money into your savings account (you will need to have both an eligible Scotiabank chequing account and the Money Master Savings Account).
Foreign currency savings account
A foreign currency savings account allows you to save currencies other than Canadian dollars and earn interest. Scotiabank offers two foreign currency accounts: the Scotia U.S. Dollar Daily Interest Account and the Scotia Euro Savings Account.
Savings accounts built for youth
A youth savings account is a type of account that’s specifically created for young children or teenagers.
Since these accounts are for minors, they usually come with some helpful features: parental oversight, little to no fees, interest on savings and a few limits on things like withdrawals. It’s all about giving young savers a safe space to build good habits and watch their money grow.
Opening one is the first step in getting your child started on the path to a strong financial future.
Savings accounts designed for students
A student savings account is specifically designed for those getting ready to head off to post-secondary. Similar to the youth savings accounts, student savings accounts usually come with benefits like no monthly account fees and rewards on debit transactions. These accounts are a great tool to learn money management.
Did you know?
Students and young adults can also benefit from the Scotiabank Preferred Package for Students and Youth, a chequing account packed with perks designed to help support the transition from teen to student life. For qualifying account holders, this package has no monthly account fees and lets you earn Scene+ points with the Scene+TM Program.2
The exact amount you choose to keep in your savings account will depend on what you can afford to save as well as your savings goals. However, it's recommended that all Canadians can benefit from having an emergency fund.
Many experts suggest having between three to six months of total living expenses. If you also have goals of saving for a special trip or a new car, you can increase your savings accordingly.
A regular savings account and a HISA both allow you to earn interest on your account balance. A HISA can help you to supercharge your savings and reach your savings goals even sooner as it typically has a higher interest rate.
With the Scotia High Interest Savings Account, you have the ability to boost your interest rate if you grow your Total Relationship Balance.1 Learn more about how interest rates are tied to your Total Relationship Balance here.
A HISA has the potential to benefit most Canadians, as long as you meet the requirements of your bank’s HISA and aren’t looking to use this account for everyday transactions.
HISAs are an important part of planning towards your financial goals. The days of saving your money in a coffee jar on the counter are over. Not just because this can make it tempting to spend it, but also because of inflation.
Simply put, inflation is when the cost of things goes up. A carton of milk or a bag of apples costs more today than it did a year ago. The bottom line is that if you aren't earning interest on your savings, then your money is losing value over time.
The point of having a savings account is to help you prepare for emergencies and save money for short and long-term financial goals (buying a car, paying for a wedding). Keeping your money in a HISA or any savings account allows you to grow your money while also offering quick access to your funds when you need them.
