Personal Finance

Which free / no fees USD Savings account pays the best interest rate?

  • Last Updated:
  • Aug 21st, 2019 1:16 pm
[OP]
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May 7, 2007
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Which free / no fees USD Savings account pays the best interest rate?

Just wondering where is the best place to park some USD?

Thanks
52 replies
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Darkman wrote:
Aug 15th, 2019 6:20 am
Just wondering where is the best place to park some USD?

Thanks
I'm honestly curious why there are so many posts on here about piddly things like where to get an extra .2% in interest on savings accounts, or where to save 0.0005 on exchange rates.

Unless you're routinely doing mid 5+ figure transactions, the differences will amount to a few dollars. Like on 50k, left for a year, the amount of that extra 0.2% is literally $100, fully taxable at your marginal rate. So like $60/year at the end of the day in your pocket. Are you talking large amounts for long periods? Then the far better option is to invest it in ETFs. If it's a more pedestrian amount for a pedestrian time frame, say 8k for 4 months, any fractional percent increases are literally enough to maybe buy a coffee after tax.

Secondly, interest rates have been in the gutter for a decade now. Why are so many people here trying to use them as a mechanism to make money? If you have a large sum, for a long time, you can invest it and make respectable returns. If it's only for a short time, then you simply aren't going to make anything worth writing home about it unless you want to gamble.
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seadog83 wrote:
Aug 15th, 2019 8:57 am
I'm honestly curious why there are so many posts on here about piddly things like where to get an extra .2% in interest on savings accounts, or where to save 0.0005 on exchange rates.

Unless you're routinely doing mid 5+ figure transactions, the differences will amount to a few dollars. Like on 50k, left for a year, the amount of that extra 0.2% is literally $100, fully taxable at your marginal rate. So like $60/year at the end of the day in your pocket. Are you talking large amounts for long periods? Then the far better option is to invest it in ETFs. If it's a more pedestrian amount for a pedestrian time frame, say 8k for 4 months, any fractional percent increases are literally enough to maybe buy a coffee after tax.

Secondly, interest rates have been in the gutter for a decade now. Why are so many people here trying to use them as a mechanism to make money? If you have a large sum, for a long time, you can invest it and make respectable returns. If it's only for a short time, then you simply aren't going to make anything worth writing home about it unless you want to gamble.
How do you know how much money OP is talking about? Maybe he has a meaningful amount to invest. Let's not make assumptions about others based on how much we have.

OP, Ratehub.ca is a good site to check this information. From what I am seeing, Tangerine is offering 1.8% on a 1 year USD GIC.
Illegitimi non carborundum
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Let's not make assumptions about how much money other people replied have, based on what they wrote :)

I was merely pointing out that guaranteed investments, and chasing returns are a poor strategy which isn't going to make any one rich. If you have a small amount for a short time say under 50k for under a year, then the difference in returns are so small as to be inconsequential.

If you have a more sizable amount on a longer time frame then the fractional percent difference is no long immaterial ($1000s), but the far greater threat is inflation. If inflation is 2%, and you've managed to be a smart consumer and shop around for that good rate to make that extra $1k/year, You're after tax return is still only on the order of 1%, so you're literally eroding 1% of your principle each year through inflation.

That's my point. If it's a small amount or for shot time frame, then it doesn't matter. If it's a large amount for a long time frame, then it belongs in either conservative bonds ETFs or stock ETFs depending on your time frame.
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^ OP asked about saving account rates and not about how to maximize/optimize returns.

Maybe you are rich but for me 1.8% interest minus 40% income tax is a meaningful amount, even on a small amount like 50-100k. That's a $540-1080 after taxes in my pocket. Btw, inflation is irrelevant if your are investing for a short period of time (few months to a year).
Illegitimi non carborundum
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Jan 21, 2018
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The interest on US$ savings accounts is usually very low.

Tangerine has a deal offering 2.75% on all savings accounts, including US$. That's even better than their 1-year GIC rate, although of course it's a short-term deal that will disappear in January. And unfortunately it's a targeted YMMV deal, so you might not be able to get it.

But if you plan to park your US$ in a 1-year GIC, the best I found recently is Canadian Western Bank (https://www.cwbank.com/en/personal/inve ... d-longterm). Unfortunately their US$ 1-year GIC rate has been dropping like a stone lately, down from 2.9% to 2.0% in just the last 2 months.
[OP]
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^ Thanks for pointing out about Tangerine's 2.75% current promo that includes USD ... That's good.

Here is my situation ... and I am only asking about Savings accounts (open, free etc account) ... not interested in GIC etc.

I never had USD account ever ... just had no need for it.

And surely I am not talking about LARGE money here ... but my situation is -- some people (not me) tend to keep some US money (in case they go to US or need it) or USD accounts ... - so they don't need to exchange the money when need USD.

I maybe (or hoping so) able to generate, say, 100 USD / month ,,, or around there (give or take few bucks).

The money would arrive to my PayPal ... where I see one can convert the money to CAD (instant converstion using PayPal's exchange rate ... and I am sure like any bank they make some money on exchanging money .. no problem there). So then I'd end up with CAD ... BUT if ever, or when I'd need some USD ... I'd need to exchange the money back to USD and go through another exchange.

So I am considering here, considering the fact that money would arrive in USD ... not to exchange them ... and just park it somewhere in USD account ... and add to that account a bit more USD, hopefully monthly. BUT might as well have some account -- free, open account that would pay me some interest on the parked USD cash.

So back to the rate ... Tangerine's 2.75% is great ... but all good things come to the end some day (re: the promo). .... What other places pay decent interest for USD accounts ... where I can move my USD cash after Tangerine promo comes to an end?
I'm honestly curious why there are so many posts on here about piddly things like where to get an extra .2% in interest on savings accounts, or where to save 0.0005 on exchange rates.
You heard my situation now ... and surely I don't care here about extra .2% or where to save 0.0005 on exchange rate etc ... -- I am just asking for some bank accounts that pay decent or better rate than other bank accounts or institutions. :)
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Scote64 wrote:
Aug 15th, 2019 10:35 am
The interest on US$ savings accounts is usually very low.

Tangerine has a deal offering 2.75% on all savings accounts, including US$. That's even better than their 1-year GIC rate, although of course it's a short-term deal that will disappear in January. And unfortunately it's a targeted YMMV deal, so you might not be able to get it.

But if you plan to park your US$ in a 1-year GIC, the best I found recently is Canadian Western Bank (https://www.cwbank.com/en/personal/inve ... d-longterm). Unfortunately their US$ 1-year GIC rate has been dropping like a stone lately, down from 2.9% to 2.0% in just the last 2 months.
Any idea how to transfer USD between Canadian US dollar account like, say, RBC and Tangerine without converting the currency with the lowest cost possible?

That part is still puzzling me the most.
[OP]
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Cucumference wrote:
Aug 15th, 2019 1:42 pm
Any idea how to transfer USD between Canadian US dollar account like, say, RBC and Tangerine without converting the currency with the lowest cost possible?

That part is still puzzling me the most.
Between Canadian US dollar account ... or accounts?

Otherwise ... - between exactly what? :)
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Darkman wrote:
Aug 15th, 2019 2:38 pm
Between Canadian US dollar account ... or accounts?

Otherwise ... - between exactly what? :)

I was asking Scote64.
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Cucumference wrote:
Aug 15th, 2019 1:42 pm
Any idea how to transfer USD between Canadian US dollar account like, say, RBC and Tangerine without converting the currency with the lowest cost possible?

That part is still puzzling me the most.
so you want to transfer USD around all USD accounts? very straight forward, remote transfer
If you say convert CAD to USD, KBFX.
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dekvitaly wrote:
Aug 15th, 2019 3:01 pm
so you want to transfer USD around all USD accounts? very straight forward, remote transfer
If you say convert CAD to USD, KBFX.
Do you know the exact process of triggering this "remote transfer" in Tangerine for example? Is there such a thing that call remote transfer? Or does it just know the source / destination account is a USD account automatically?
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You can link tangerine USD account to RBC USD account from tangerine then you can move money initiated from tangerine.
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wra45mon wrote:
Aug 15th, 2019 5:22 pm
You can link tangerine USD account to RBC USD account from tangerine then you can move money initiated from tangerine.
That is what I did but what next after the 2.75% promo expire at the end of the year?
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cgtlky wrote:
Aug 15th, 2019 7:58 pm
That is what I did but what next after the 2.75% promo expire at the end of the year?
Move USD to Hubert, to a brokerage, or to a US based bank account?
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