Have you ever wondered why the idle cash in your brokerage account yields next to no interest ? The answer is simple: brokers make money by using your hard earned savings for (nearly) free ! This is, of course, a smart business practice and also allows brokers to offer rock bottom trading commissions. But, with a little bit of effort, you can earn higher interest on your idle cash. Mr. Thrifty is here to give you the tools to make guaranteed interest on your brokerage account cash by explaining the little known world of investment savings accounts.
But, first, the basics……..
What are Investment Savings Accounts ?
- Canadian Dollar and U.S. Dollar savings accounts available only through brokers and advisors.
- The accounts listed below are CDIC insured
- Purchased and sold like mutual funds.
- “Trades” settle on a T+1 basis (i.e., the business day following the trade), as opposed to trades for securities, which settle on a T+2 basis.
- Generally, only available to Canadian residents.
- Available in “Series A” (typically limited to individuals) and “Series F” (generally higher yielding, typically limited to financial advisors)
- Interest rates competitive with the savings rates available directly from the same banks. Incredibly, the interest rates for U.S. Dollar deposits are all substantially higher than the savings rates available directly from the same banks !
A few words of caution:
- Stay within CDIC limits, where applicable
- Pay attention to trading fees and minimum amounts. As you know, Mr. Thrifty hates fees — they will quickly eat into the higher interest rates obtained by opening these accounts. The good news is that brokers will generally not charge a fee for investment savings accounts opened with their affiliated banks.
- Information changes regularly so check back often for updates.
- Better yet, sign up for our newsletter and stay informed.
And, now, for the details:
Canadian Dollar Investment Savings Accounts*
| Account (Fund Code) | Indicative Rate** | |
| B2B Bank (BTB100 – A Series; BTB101 – F Series) | 3.00% (A Series) 3.25% (F Series) | Click here for more information |
| BMO (BMT104, BMT109, BMT114) | Information not available – contact BMO to inquire | Click here for more information |
| CIBC (ATL5000 – A series; ATL5001 – F series) | 2.80% (A Series) 3.05% (F Series) | Click here for more information |
| Desjardins (DJQ1000 – A series; DJQ1100 – F series) – available only to residents of Quebec | 3.10% (A Series) 3.35% (F Series) | Click here for more information |
| Equitable Bank (EQB1000 – A Series; EQB1001 – F Series) | 2.90% (A Series) 3.05% (F Series) | Click here for more information |
| HomeBank (HOB100 – A Series; HOB101 – F Series) | 2.90% (A Series) 3.15% (F Series) | Click here for more information |
| Home Trust Company (HOM100 – A Series; HOM101 – F Series) | 2.90% (A Series) 3.15% (F Series) | Click here for more information |
| ICICI Bank (IBN100) | Information not available – contact ICICI to inquire | |
| Manulife Bank (MIP510 – A Series; MIP610 – F Series) | 2.75% (A Series) 2.90% (F Series) | Click here for more information |
| Manulife Trust (MIP710 – A Series; MIP810 – F Series) | 2.75% (A Series) 2.90% (F Series) | Click here for more information |
| National Bank (NBC100, NBC6100, NBC8100 – A Series; NBC200, NBC6200, NBC8200 – F Series) | 2.80% (A Series) 3.05% (F Series) | Click here for more information |
| RBC (RBF2010, RBF2020, RBF2030, RBF2040 – A Series; RBF2011, RBF2021, RBF2031, RBF2041 – F Series) | 2.80% (A Series) 3.05% (F Series) | Click here for more information |
| Scotiabank (DYN6000, DYN5000, DYN3064, DYN3074, DYN3054 – A Series; DYN6004, DYN5004, DYN3065, DYN3075, DYN3055 – F Series) | tiered: (A Series) $0-$99,000 = 2.95% $100,000 – unlimited = 3.10% F Series: 3.20% | Click here for more information |
| TD Bank (TDB8150, TDB8155, TDB8157, TDB8159 – A Series; TDB8151, TDB8156, TDB8158, TDB8160 – F Series) | 2.80% (A Series) 3.05% (F Series) | Click here for more information |
| Account (Fund Code) | Indicative Rate** | |
| BMO (BMT124) | Information not available – contact BMO to inquire | Open an account here |
| CIBC (ATL5500 – A Series; ATL5501 – F Series) | 4.15% (A series) 4.40% (F series) | Click here for more information |
| Equitable Bank (EQB1100 – A Series; EQB1101 – F Series) | 3.65% (A series) 3.80% (F series) | Click here for more information |
| ICICI Bank (IBN200) | Information not available – contact ICICI to inquire | |
| Manulife Bank (MIP511 – A Series; MIP611 – F Series) | 3.15% (A Series) 3.40% (F Series) | Click here for more information |
| National Bank (NBC101 – A Series; NBC201 – F Series) | 3.90% (A Series) 4.15% (F Series) | Click here for more information |
| RBC (RBF2014 – A Series; RBF2015 – F Series; ) | 3.90% (A Series) 4.15% (F Series) | Click here for more information |
| Scotiabank (DYN6001, DYN5001 – A Series; DYN6005, DYN5005 – F Series) | tiered: (A Series) $0-$99,000 = 3.90% $100,000 – unlimited = 4.05% F Series: 4.15% | Click here for more information |
| TD Bank (TDB8152 – A Series; TDB8153 – F Series) | 3.90% (A Series) 4.15% (F Series) | Click here for more information |
U.S. Dollar Investment Savings Accounts*
* Based on reader feedback we are listing information (where available) for both Series A and Series F. Most brokers limit individual investors to Series A, but we received feedback of individual investors able to purchase higher yielding Series F.
** As indicated on the listed financial institution’s website – last checked by Mr. Thrifty on 21/12/2024. In certain cases it appears that the relevant website has not been recently updated. As always, contact the financial institution for its current rate(s) before making a deposit.
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Why would I invest in an ISA when GICs are yielding 2.6-3.0%.
Thanks for your question. Our goal is to educate people so that they know what options are available to them and can evaluate these options within their goals, objectives and risk tolerances. In our view, Investment Savings Accounts are best suited to people who are looking to earn yield on idle savings while maintaining the liquidity which would not be available in longer term investments, such as GICs.
GICs are not for parking. If you saw a stock that you want you could not buy it because your money was being held in a GIC for however you chose to buy.ski
BMO pays 1.6 Cdn and 1.7 US
also, when you buy stocks it used to be T3 but at BMO it is T2
I complained and was told that all brokerages are T2
You complained? Via a quick on-line search you would have learned that it is not a brokerage rule, it is set by the stock exchanges. While three-day settlement (T+3) used to be common, a few years ago many major exchanges have moved to two-day settlement. For example, the TSX, NYSE and NASDAQ are all T+2. Your broker has no power to change that.
Thank you for the article, you are an inspiration to us all.
Minor update to correct. Article says “Canadian Dollar (CDIC-insured) and U.S. Dollar (not CDIC-insured) savings accounts”. Foreign currency deposits are now CDIC eligible.
Good catch! We had updated our articles generally to reflect the enhanced CDIC coverage but missed that reference. We’ll update the article. Thanks for pointing that out – we appreciate your feedback!
At BMOInvestorLine, it is saying that investments in EQB1000 are “No longer allowed” and limited to existing investors. Is this a BMO restriction or is it EQ Bank?
Thanks for reporting. I suspect this is a BMO restriction. I have heard of banks/brokerages restricting the ability of customers to purchase ISAs offered by other banks.
Others in the Thrifty community should feel free to weigh in with their experiences.
This is a great tip here – I often feel like people tend to forget about their cash that is just sitting when it could be used to earn a return (no matter how small). This is especially true because the bank/broker is going to be using your deposits to generate a return anyway! Instead of letting them invest your cash you should be doing it yourself! Great article.
Thanks for the article. I know EQB1000 is available for trade with HSBC InvestDirect.
I have one question. If I buy EQB1000 via HSBC InvestDirect. Say I want to buy $1,000,000 of EQB1000. If I make 10 transactions of $100,000 each, this means my assets are protected by CDIC? (Only insure max $100,000)
Thank you.
I would assume all purchases with a ISA would be aggregated for purposes of determining the CDIC limit.