Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

There are two ways to go if you want to wring all the interest you can out of your savings account - find a bank with a competitive rate or chase temporary deals offering great rates.

Lots of people are willing to chase great rates, which explains why banks keep offering them via temporary deals. The latest, greatest example is the 3.3-per-cent rate that Laurentian Bank of Canada’s digital arm started offering last fall on an online savings account. Last week, LBC Digital said the offer will end on March 1, when the rate falls to 2.8 per cent.

“Isn’t that a clear case of bait and switch,” asked a reader of the Carrick on Money newsletter.

Story continues below advertisement

That’s too harsh a term to use. Bait and switch means advertising a particular item and then substituting something that is either more expensive or inferior. What Laurentian Bank did was follow a popular script in banking in recent years. Offer a great rate, scoop up a bunch of new clients and then announce plans to ease the rate back down. Don’t be surprised if the 2.8 per cent rate that kicks in March 1 is in turn lowered at some future date. Right now, 2.8 is still very good.

Banks, like Laurentian, should do a better job of being clear that the above-market rate they offer at first is temporary. Yes, there are always asterisks and fine print. On the Laurentian website, the 3.3-per-cent rate was shown with a footnote saying that all rates are subject to change at any time without prior notice. A suggestion for banks planning a high rate introductory offer in the future: Call the offer a “welcome rate” or something like that, acknowledge that it’s temporary and then pledge to always be competitive.

If you’re willing to follow the rates offered by online banks closely and move money as needed to capture the best returns, then there’s no reason not to capitalize on offers like the one from LBC for as long as they last.

An easier to follow regimen is to find a bank that consistently offers competitive rates and stick with them. If you check the Canadian High Interest Savings Bank Accounts website from time to time, you’ll see a cluster of banks consistently offering 2.3 per cent or so and a few that are higher than that. Motive Financial has been offering 2.8 per cent on its Savvy Savings account for a while now.

Also, don’t be naive when looking at rates offered by new banks trying to get some attention. The Bank of Canada’s influential overnight rate is at 1.75 per cent and one-year Treasury Bills issued by the federal government have yields in similar territory. In mid-February, big banks were offering one-year guaranteed investment certificates with rates as low as 1.2 per cent.

LBC’s rate was out of sight in today’s ultra low rate world. You had to know it wouldn’t last long.

Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies