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MONEY ADVICE 

 

Why You Should Have a High Interest Savings Account

4 minute read


Have you ever looked at your savings account and wished it could do more for you? Here’s the good news: it can.

Imagine what you could do with those additional savings. Perhaps it would mean finally booking a once-in-a-lifetime trip. You might turn a few minor home upgrades into the renovation you’ve always wanted. Or maybe you would achieve true peace of mind by successfully building a six-month emergency fund. Regardless of your goals, there’s a way to make your savings work harder today so that your dreams of tomorrow become a reality.

It’s called a high interest savings account, or HISA. As the name implies, a HISA is a type of savings account that pays a higher interest rate than a chequing (which usually pays no interest) or standard savings account. The more you add, the more interest you’ll earn back. You can also easily access your money whenever you need it.

That’s only the start. Let’s dive into what this powerful savings account can do for you.

1. Interest that works harder for you

One of the greatest advantages of a HISA is that it allows you to earn attractive interest rates on every dollar you invest. These rates can be significantly higher than traditional savings accounts, typically ranging anywhere from 0.75% to 3.00% at the time this article was written. As a result, you’ll see your savings grow at a faster rate — simply by holding the balance in your account. The best part: this requires no extra effort on your part.

Another feature? Many HISAs don’t charge a monthly fee and offer free transaction(s) each month. This ultimately translates into less money spent on account fees and increased savings.

2. It’s easy, safe and accessible

HISAs are also relatively straightforward to set up. In fact, it only takes a few minutes to open an account online, or through our secure online banking if you’re already a member. Your money can be easily withdrawn anytime you need it, such as for an unexpected vet bill or home repair — offering a more flexible option than other investments with fixed terms.

Your funds aren’t impacted by market swings either, meaning there isn’t a risk of loss. What’s more, deposits and accrued interest in your HISAs are 100% guaranteed†, so you can have peace of mind knowing your hard-earned savings are protected.

3. Reach your financial goals faster

As the saying goes, ‘seeing is believing’ — and that holds especially true with savings accounts. High interest savings accounts can be renamed to reflect the purchase or milestone you’re saving for in the short term. For instance, you may want to change your account name to “Property Tax Savings” or “Car Down Payment.” If you can, it helps to be as specific as possible by adding timelines and other details, such as “Italy Vacation May 2023.”

To help visualize what you’re saving for, you’ll be continually reminded of your goals and more likely to bring them to life. We also recommend setting up an automatic transfer into your high interest savings account, like a $50 transfer each payday. It gives you one less thing to do during your already busy days.

A high interest savings account pays you higher interest on your hard-earned savings than traditional accounts do, while also giving you the flexibility to access your funds when needed. Simply deposit your money, sit back — and watch it grow.

The bottom line

With competitive interest rates, HISAs can empower you to realize your financial goals. Maybe it’s for that long-awaited trip, or some other big-ticket purchase you’ve set your sights on. Or perhaps you’re tucking away your money for a rainy day. Whatever your reason, HISAs can help you get there sooner.


†The Credit Union Deposit Insurance Corporation of British Columbia, a statutory corporation, fully guarantees all BC credit union deposits. Credit Union equity shares and investments such as mutual funds or RSP equity plans are not covered by deposit insurance.

From November 1, 2021, to November 21, 2021, the members of First West Credit Union voted on special resolutions that, among other things, authorize First West to apply to become a federal credit union under the Bank Act. If First West becomes a federal credit union, it will automatically become a member of the Canada Deposit Insurance Corporation (CDIC) and Credit Union Deposit Insurance Corporation of British Columbia deposit insurance will no longer apply. See attached Notice for further detail on what this change means to your deposits with First West.