Compiled by RedFlagDeals.com Staff
The new year means there are new opportunities for you to get the most out of your money. As of January 2, 2009, the Tax-Free Savings Account introduced by the Government of Canada in the 2008 Budget has been made available. In a nutshell, Canadians will be able to set aside up to $5000 each year in various savings options and not have to pay tax on the income earned or on withdrawals. If you haven't already, you can check out our feature article from 2008 called A Wealth of Choices: Understanding the New Tax-Free Savings Account that will help you understand what the Tax-Free Savings Account is all about and how it can impact your financial planning. You should also have a look at the Government of Canada Tax-Free Savings Account Page.
The next step is figure out which financial institution's Tax-Free Savings Account products are right for you. To get the ball rolling, we've put together a comparison of Tax-Free Savings Accounts, TFSA Investment Accounts, and TFSA GICs. Since the Tax-Free Savings Account is so new, there are some gaps in available information. This comparison has been put together using information found online as well as from phone inquiries. We'll continue to update this article as more offers and information become available. Rates and fees are current as of October 30. If you've spotted an error or know something we don't, send an email to email@example.com and let us know.
TFSA Savings Account Comparison
|Savings Account||Transfer Out Fee||Interest Rate||Minimum Investment/Deposit||Check Interest Rate Online||Website|
|Citizen's Bank||$25||0.80%||none||Yes||Click here|
|ICICI Bank||Yes||1.40%||none||Yes||Click here|
|ING Direct||none||1.05%||none||Yes||Click here|
TFSA Investment Account Comparison
|Investment Account||Adminstrative Fee||Withdrawal Fee||Transfer-Out Fee||Partial Transfer Fee||Swap Fee||Cost Per Trade||Website||Fees Schedule|
|BMO Investorline||$50 (none if your total household assets with BMO Investorline equal $100,000 or more)||$25||$135||$50||$45||$9.95 to $29||Click here||Click here|
|eTrade Canada||none||$50 Certificate Withdrawal, $10 Cheque Withdrawal||$125||?||$50||$6.99 to $19.99||Click here||Click here|
|HSBC InvestDirect||$50||?||$125||$125||$35||$29.00 and up||Click here||Click here|
|Questrade||none||Free for Electronic Fund Transfers up to $25,000, $10 and up otherwise||$125||$25||$25||$4.95 to $9.95||Click here||Click here|
|RBC Direct Investing||none||none||$135||?||$35||$6.95 to $9.95||Click here||Click here|
|TD Waterhouse||$50 (none if registered for eServices or your total household assets with TD Waterhouse equal $100,000 or more)||$25||$125||$25 per asset, to a maximum of $100||$45||$7.00 and up||Click here||Click here|
TFSA GIC Comparison
|GICs||1 Year||2 Year||5 Year||More Rates and Information|
|ING Direct||1.25%*||2.25%*||3.25%*||Click here|
|ICICI Bank||1.20%||1.70%||3.10%||Click here|
|National Bank of Canada||0.15%*||1.05%*||1.85%*||Click here|
|Products denoted by a * are cashable|
As of October 30, 2009, none of the banks are offering an interest rate higher than 1.50% on their TFSA savings accounts. Canadian Tire Financial Services and Scotiabank are presently the only 2 financial service providers with rates of 1.50%.
If you're considering an investment account, Questrade's product stands out with low costs per trade with a maximum of $9.95 and no administrative fees. The offers that we know of from the "Big 5" are currently limited to BMO InvestorLine, RBC Direct Investing, and TD Waterhouse. Both BMO and TD have $50 annual fees unless you have $100,000 in household assets with them. RBC has no annual fee.
Turning to GICs, ING Direct currently appears to have the highest rates at 1.25% for 1 year, 2.25% for 2 years, and 3.25% for 5 years. For redeemable GICs, the best rates right now are also being offered at ING Direct.
While this comparison is a starting point and we've done our best to ensure accuracy, we strongly advise that you conduct your own research before making a decision. If you happen to get new information, drop us a line at firstname.lastname@example.org so we can update the charts and share the details.
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