Best place to park kid's money?

HISA is your best bet, since it's only $2000 and you're not looking for long term growth.

I would use an o line bank that pays regular or monthly interest. That way your child can log in and visibly see then interest accumulate immediately. The learning experience is far more valuable than the actual return.

Just confirm if it is not some promotion and after 2-3 month it drops to a small interest rate.

Currently Tangerine have 3.25% interest on up to $500,000 in new deposits, but it is only until Mar 31, 2017

Do you have an RESP for the child? If not, that would gain you 20% right away, but has obvious limitations.

Thanks for suggestions.

Already doing $2500/year in RESP to max out the 20% grant.

Yes eqbank seems to be 2% all the time and not a promotion.
https://www.eqbank.ca/personal-banking/features-rates

Don't want to make this complicated. Just looking to see if there is a HISA with better rate.

Kevinck wrote: ↑ My 6 year old is getting $2k from great grandma. Where is the best zero risk and less than 1year locked place to park this for a while?

Zero risk would be Tangerine or similar.

But I would buy an index fund or ETF; take some risk, it's only $2,000 plus you have a lot of years to average out returns.

booblehead wrote: ↑ Buy some bank shares and dividends earned can be reinvested .. Overtime, it surely will appreciate

Or a Bank ETF.

OP sounds like s/he wants risk-free HISA, just looking for best interest. "Back in my day" parents would have invested in CSBs (lol).
The issue with investing for growth (ie ETFs) is that the income will be attributed to parents until child is 18. I haven't found a way for even early teenagers to invest in the 'market' on their own. ???

EQ for the consistent 2%, plus the child can watch the money grow. Great learning experience.

Why some people above recommended Tangerine is beyond me...their promos are only good for a very short period of time unless you want ot constantly be withdrawing and putting it back.

cocodc wrote: ↑ OP sounds like s/he wants risk-free HISA, just looking for best interest. "Back in my day" parents would have invested in CSBs (lol).
The issue with investing for growth (ie ETFs) is that the income will be attributed to parents until child is 18. I haven't found a way for even early teenagers to invest in the 'market' on their own. ???

I opened a trust for each of the kids and that is where their monetary gifts from grandparents and family goes. Doesn't get attributed to me. They are invested in mutual funds.

Kevinck wrote: ↑ Thanks for suggestions.

Already doing $2500/year in RESP to max out the 20% grant.

Yes eqbank seems to be 2% all the time and not a promotion.
https://www.eqbank.ca/personal-banking/features-rates

Don't want to make this complicated. Just looking to see if there is a HISA with better rate.

Put it into the RESP anyways. It will grow tax free.

cocodc wrote: ↑
The issue with investing for growth (ie ETFs) is that the income will be attributed to parents until child is 18. . ???

The income attribution rules apply to funds transfers from the child's parents and not applicable to gifts from grandparents or other relatives.

psudolam wrote: ↑ The income attribution rules apply to funds transfers from the child's parents and not applicable to gifts from grandparents or other relatives.

I do not think this is true. The earnings from the gift are attributed back to the adult who gave it to the child. Only capital gains can be used by the child if they sell after age 18. If not grandma and friends ie. non parents could give maga bucks as a tax shelter.

profile wrote: ↑ I do not think this is true. The earnings from the gift are attributed back to the adult who gave it to the child. Only capital gains can be used by the child if they sell after age 18. If not grandma and friends ie. non parents could give maga bucks as a tax shelter.

The attributions rules are in section 74.1 in the Canadian Income Tax Act and they apply to transfers of property (including funds & real properties) between spouses, and between parents and their children. That is, they do not apply outside the immediate family unit. That is, your friends can give their after tax dollars to you or to your child without any tax implications. I dont see that as a tax shelter on their part, as it is a gift without expectation of returns.

Should i open the EQBank account in my 6 year old son's name?

Kevinck wrote: ↑ Should i open the EQBank account in my 6 year old son's name?

I think you have to be 18+ to open an account. You can open it in your name though.

+++1

booblehead wrote: ↑ Buy some bank shares and dividends earned can be reinvested .. Overtime, it surely will appreciate