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How to choose a bank account that’s right for you
Knowing what to look for will help you find an account that fits.
Is there more than one type of bank account?
In Canada, there are generally 2 main types of bank accounts: chequing accounts and savings accounts.
A chequing account is available for frequent and immediate access and is most commonly used as an everyday transaction account. If you want to purchase something, you would typically use this type of account. Chequing accounts commonly come with:
- A linked debit card. Usually either Visa debit or Mastercard debit card.
- ATM access. Though some accounts will charge a fee if you use an out-of-network ATM.
- Internet banking. This feature allows you to go online to access your account details and make transactions.
- Branch access. This feature allows you to process transactions in a bank branch.
- Cheque book. This feature allows you to make purchases with cheques. Subsequent cheque books usually have to be purchased for a fee. Cheques can also be voided (cancelled) and given to employers or companies to set up automatic withdrawals from your chequing account.
Chequing accounts with special benefits
There are several special benefits attached to some chequing accounts such as:
- Earn points: With Scotiabank, you can enroll into the Scene+ points program, which can allow you to earn points that are redeemable for a movie at any Scotiabank theatre across Canada.
- Get travel rewards miles: You’ll be awarded 1 AIR MILES point for every $30 spent using the BMO Debit Card on your everyday purchases
when you have a BMO AIR MILES Chequing Account. This plan also includes unlimited monthly transactions using BMO’s services, unlimited Interac e-transfers and point-of-sale transactions on the worldwide Maestro and Mastercard network. You can You’ll collect 25 extra Miles every month if you’re also signed up with a BMO AIR MILES World Elite Mastercard..
- Promotional cash bonus or gift card: This is a form of incentive offered to customers where they receive a cash bonus, gas card or some other free gift after opening an account.
The 10 important factors to consider when choosing an everyday chequing account
1. Fees. Are there any monthly fees?
2. ATM access. Does your bank have a large number of ATMs?
3. Branches. If you prefer to bank in person, does your bank have a national network of branches?
4. Special account needs. If you’re a student, look for a bank that offers fee-free student accounts.
5. Eligibility criteria. You’ll typically need to be at least the age of majority in the province or territory in which you reside (either 18 or 19 years old) to open an account independently. Other eligibility requirements may include being a Canadian resident with a Canadian mailing address.
6. Currency conversion fees. Look into how much it’ll cost to use your debit card overseas.
7. Minimum deposits. Check if the account has a minimum opening deposit or if you need to meet a minimum ongoing balance to avoid fees. Learn more about minimum balance and deposit requirements in our guide.
8. Debit card access. Look into what kind of debit card the bank offers and how easy it is to freeze your account and get a replacement if you lose yours.
9. Bonus offers. Some bank accounts offer a cash bonus when you sign up. But don’t get an account just because of a freebie — look into all of the other features first.
10. Earning capabilities. Some chequing accounts earn cashback bonuses or even interest.
It’s okay if you don’t find the right bank account right away. It may take some time to sort through all the features offered by different banks, but it’s worth it to find an account that suits you.
How do I open a chequing account?
Most banks will allow you to open an account online. You’ll need to supply your personal information, including your Social Insurance Number (SIN), and government ID such as a passport or a driver’s license.
To get started, visit the website of the bank you’re interested in, navigate to the application page and follow the onscreen prompts. When your application has been processed and approved, you’ll be notified and given the details of your new account so that you can transfer money into it.
What are some chequing account options?
The best chequing account is the one that fits your needs, and every person will have a different best account. Here are a couple of popular chequing accounts in Canada:
The Scotiabank Preferred Package is a low-fee account that combines some of Scotiabank’s most popular account features with a top-notch selection of preferred rates and rewards.
- $16.95 fee per month
- Monthly transactions are unlimited
- Earn a $300 welcome bonus. Valid until September 30, 2022. Plus, earn up to 3.20% interest on your MomentumPLUS Savings Account.
The Tangerine Chequing Account offers competitive rates and fees, as well as a massive network of ATMs nationwide.
- $0 fee per month
- Monthly transactions are unlimited
- 0.1% APY
Compare more chequing accounts
These accounts earn interest to help you save. Most also put restrictions on your withdrawals, which can give you motivation to save — but the fees can also eat into your savings if you make too many withdrawals.
To find the account that fits your needs, compare accounts based on:
- Interest rate. Even a small difference in interest rate can start to add up over time.
- Minimum and maximum account balances. Not every account will be the right fit for the nest egg you’re tucking away.
- Ongoing fees. Check what fees you’ll need to pay, and if fees can be waived by meeting certain account requirements.
- Account requirements. Some savings accounts will require a linked chequing account. Credit union accounts can require you to work at a specific place, live in a specific area or meet other membership requirements.
What are some savings account options?
The best savings account is the one that fits your needs, and every person will have a different best account. Some popular savings accounts include:
This interest-earning account charges little or no fees and offers a competitive interest rate. New clients can earn up to 2.75% interest on their balance for the first 5 months, plus get a $400 cash bonus. Offer valid until August 18, 2022.
- $0 monthly fee
- 1.65% APY
- $0 insufficient funds fee
- Eligible for CDIC coverage up to $100,000
Compare more savings accounts
What are the downsides of savings accounts?
These accounts can help you save, but there are disadvantages too.
- Variable interest rates. If your account has a variable interest rate, your APY could drop in the future — but it could also rise. Interest rates on variable accounts are influence by the economy and the prime rate set by the Bank of Canada.
- Withdrawal limitations. If you make more than amount of withdrawals your account allows you to make per month, you could be charged fees amounting to as much as several dollars per transaction.
- Watch out for introductory rates. Some accounts offer a higher interest rate for an introductory period. If you sign up for one of these accounts, check what your long-term interest rate will be.
What other types of savings accounts exist?
Online savings accounts are popular because they’re convenient. You can make your deposits from the comfort of your living room. These accounts typically offer competitive interest rates due to the lower overheads associated with online-based institutions.
Encouraging children to start saving early can greatly benefit their financial habits in the future. Many banks offer savings accounts specifically for children. Most require a parent or guardian to open the account on behalf of the child or as a joint account holder.
These can include Registered Retirement Savings Plans (RRSPs) or any other account with the main purpose of saving for retirement.
If you’re looking for a new place to bank, it’s worth taking the time to compare savings accounts or chequing accounts to find one that’s the perfect fit. To avoid any nasty surprises, read all the fine print before signing up for a new account.
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