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Canada Premium Bonds come off the presses at the Canada Bank Note Company in Ottawa.
Canada Premium Bonds come off the presses at the Canada Bank Note Company in Ottawa.

How do savings bonds work?

The risks of savings bonds Add to ...

Canada Savings Bonds (CSBs) and Canada Premium Bonds (CPBs) are considered lower-risk investments because they're backed by the Canadian government. For this reason, savings bonds have a relatively low return compared to other investments. And they may not keep pace with inflation.  

Other things to consider

More Related to this Story

  • You can only buy savings bonds at certain times of the year.

  • The interest you earn on a savings bond will be fully taxed if you hold it outside of a registered account. Learn more about how investments are taxed.

  • You may pay a penalty or lose interest earned if you cash in a savings bond early.

Caution: Because savings bonds are lower risk, they have a relatively low return compared to other investments. And they may not keep pace with inflation.

Content in this section is provided in partnership with Investor Education Fund, a non-profit organization founded and supported by the Ontario Securities Commission that provides unbiased and independent financial tools to help Canadians make better money decisions. To find out more, go to: GetSmarterAboutMoney.ca

 
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