Personal Finance

Official RFD thread for High Interest Savings Accounts (See Thread Summary for Updates)

Sr. Member
Apr 23, 2009
657 posts
176 upvotes
GTA
don242 wrote: Received that as well. Just be wary, the offer period is from the start of December and they take the average daily closing balance for each day in the offer period. So considering it is Dec 22 already, that means if you did not have anything in the account, you already have 22 days of zero that will be averaged in.

Edit: It does come to the same thing if you just add money today and only get interest from today forward. It still averages the zero days in, but no different than any other account if you had zero and just added money later.
I am confused. I received the offer and I transferred some $ to simplii, starting from ~ Dec 19th. (before that i had ~zero balance.) If I don't plan to keep the $ there for the rest of the offer perid (up to 4/30/23) is it better to take the $ back to Tang (4.75%)?

I know that simplii only gives you simple interest, while Tang gives you monthly compounding (so if the promo rates are the same Tang is the way to go). Other than that if Tang is also offering new money promo, I don't see anything different about the Tang vs Simplii offers the way I read the current Simplii terms. Am I wrong?

Thanks :)
Deal Addict
May 21, 2004
2921 posts
2182 upvotes
GTA
don242 wrote: Received that as well. Just be wary, the offer period is from the start of December and they take the average daily closing balance for each day in the offer period. So considering it is Dec 22 already, that means if you did not have anything in the account, you already have 22 days of zero that will be averaged in.

Edit: It does come to the same thing if you just add money today and only get interest from today forward. It still averages the zero days in, but no different than any other account if you had zero and just added money later.
Actually, it does make a difference when you take the average with zeros. Perhaps I'm misunderstanding what you mean?
Deal Fanatic
User avatar
Nov 19, 2004
9139 posts
2045 upvotes
Cambridge, ON
Britex wrote: Actually, it does make a difference when you take the average with zeros. Perhaps I'm misunderstanding what you mean?
You are right, it does make a difference.

And maybe this is wrong, but when I read it, I was thinking more along the lines that you get interest on the balance (above your starting amount) for the average of the entire $100 days regardless of what you have in there day-to-day. For example, just to keep it easy - Say the promo is for 100 days, on day 0 you have zero in the account. You put $100k in on day 21 because they are only getting around to telling you about the promo well after it starts (which is stupid).

1. Normal - If the $100k collects 5% from the day you put it in (day21) until then end. You get 80 days of interest at 5% (~$1096).
or
2. They average the entire 100 days and give you 5% on that. You put $100k in on day 21. The average balance would be $80k over those 100 days (since the first 20 was zero). You get 5% on $80k for the entire 100 days = ~$1096.

Both come to the same.
Deal Fanatic
User avatar
Nov 19, 2004
9139 posts
2045 upvotes
Cambridge, ON
emiabe wrote: I am confused. I received the offer and I transferred some $ to simplii, starting from ~ Dec 19th. (before that i had ~zero balance.) If I don't plan to keep the $ there for the rest of the offer perid (up to 4/30/23) is it better to take the $ back to Tang (4.75%)?

I know that simplii only gives you simple interest, while Tang gives you monthly compounding (so if the promo rates are the same Tang is the way to go). Other than that if Tang is also offering new money promo, I don't see anything different about the Tang vs Simplii offers the way I read the current Simplii terms. Am I wrong?

Thanks :)
If my interpretation is correct... which people are free to correct me... it seems that Simplii is still the better option (compounding aside). For simplistic sake, say the promo is 100 days long. You have $100k that you deposit in either Simplii or Tangerine for one day (after that you decided to spend it all on some go wild party). On that one day you would get the following interest from each:

Tangerine = $100k * 4.75% /365 = $13.01

Simplii = $100k for one day is $1k average for the promo period of 100 days = $1k * 5% /365 *100 days = $13.70

Again, this is just my interpretation as it seems Simplii is taking the average of the promo period regardless of whether or not you had money in their every day or not.
Deal Addict
Apr 18, 2008
1704 posts
819 upvotes
Toronto
don242 wrote: If my interpretation is correct... which people are free to correct me... it seems that Simplii is still the better option (compounding aside). For simplistic sake, say the promo is 100 days long. You have $100k that you deposit in either Simplii or Tangerine for one day (after that you decided to spend it all on some go wild party). On that one day you would get the following interest from each:

Tangerine = $100k * 4.75% /365 = $13.01

Simplii = $100k for one day is $1k average for the promo period of 100 days = $1k * 5% /365 *100 days = $13.70

Again, this is just my interpretation as it seems Simplii is taking the average of the promo period regardless of whether or not you had money in their every day or not.
Now change your example slightly -- let's say there is a starting balance of $1k, that both companies use as threshold to qualify for the high interest rate (4.75% / 5%).
In Tangerine's case, for that 1 day $99k qualifies for 4.75% (so roughly $12.88) (plus $1k for 1 day at whatever the low base interest rate)
In Simplii's case, your average balance over 100 days is $1k, so no money qualifies for 5%, all earn the low base rate only

It can be mathematically proven, that the Simplii's "average balance" calculation is never better than the normal "each day's balance" calculation (like Tangerine). It is equal (at best), or worse (whenever any day drops below the "starting balance").

But who cares about math details ... Easiest way to understand is to think of this: every day that your balance is below the "starting balance", in Tangerine's case it has no bad effect on the other days when you have higher balance and do qualify for bonus interest. In Simplii's case, those days pull down the "average balance" and do lower the overall amount that qualifies for bonus interest.

And yes if your "starting balance" is $0 -- as all RFDers should arrange their finances to achieve -- then yes the "average balance" approach is no worse, and 5% is better than 4.75%. (4.75% compounding monthly is roughly equivalent to 4.85% non-compound annual rate, so 5% is still better.)
Last edited by ssiu on Dec 24th, 2022 5:22 pm, edited 1 time in total.
Amerifriend threads need to include instructions on how to acquire an amerifriend. :confused:
Deal Addict
Apr 18, 2008
1704 posts
819 upvotes
Toronto
don242 wrote: You are right, it does make a difference.

And maybe this is wrong, but when I read it, I was thinking more along the lines that you get interest on the balance (above your starting amount) for the average of the entire $100 days regardless of what you have in there day-to-day. For example, just to keep it easy - Say the promo is for 100 days, on day 0 you have zero in the account. You put $100k in on day 21 because they are only getting around to telling you about the promo well after it starts (which is stupid).

1. Normal - If the $100k collects 5% from the day you put it in (day21) until then end. You get 80 days of interest at 5% (~$1096).
or
2. They average the entire 100 days and give you 5% on that. You put $100k in on day 21. The average balance would be $80k over those 100 days (since the first 20 was zero). You get 5% on $80k for the entire 100 days = ~$1096.

Both come to the same.
That is correct. They are the same in this case, because "starting balance" is $0, the $0 days do not have bad effect, all money qualifies for bonus interest.
Amerifriend threads need to include instructions on how to acquire an amerifriend. :confused:
Deal Expert
Jan 7, 2002
26740 posts
24181 upvotes
Waterloo, ON
ssiu wrote: Now change your example slightly -- let's say there is a starting balance of $1k, that both companies use as threshold to qualify for the high interest rate (4.75% / 5%).
In Tangerine's case, for that 1 day $99k qualifies for 4.75% (so roughly $12.88) (plus $1k for 1 day at whatever the low base interest rate)
In Simplii's case, your average balance over 100 days is $1k, so no money qualifies for 5%, all earn the low base rate only

It can be mathematically proven, that the Simplii's "average balance" calculation is never better than the normal "each day's balance" calculation (like Tangerine). It is equal (at best), or worse (whenever any day drops below the "starting balance").

But who cares about math details ... Easiest way to understand is to think of this: every day that your balance is below the "starting balance", in Tangerine's case it has no bad effect on the other days when you have higher balance and do qualify for bonus interest. In Simplii's case, those days pull down the "average balance" and do lower the overall amount that qualifies for bonus interest.

And yes if your "starting balance" is $0 -- as all RFDers should arrange their finances to achieve -- then yes the "average balance" approach is no worse, and 5% is better than 4.75%. (4.75% compounding monthly is roughly equivalent to 4.85% non-compound annual rate, so 5% is still better.)
I was going to suggest you email this analysis to Simplii and ask them to confirm if this is an accurate explanation of their offer's terms. But perhaps you should refer this to someone like the G&M's Rob Carrick who is more likely to get a response from them and, if correct, will be in an ideal position to let TROC know about it.
veni, vidi, Visa
Sr. Member
Aug 16, 2005
717 posts
131 upvotes
Britex wrote: For people considering the Simplii offer, I'm reposting my prior message with modified deposit dates to illustrate when you make your deposits makes no difference. As well, please take note of @don242's comment of them average some zero days at the start of the promo as that is a huge deal. Simplii has really outdone themselves to be the scummiest bank.

I'll give a simplified example to better illustrate how Simplii is screwing their customers. Let's say they are giving 5% interest for a mere 10 day promo and it begins on Day 1 and ends on Day 10. The account balance is as follows:
Day 1: $5,000
Day 2: $0
Day 3: $10,000
Day 4: $0
Day 5: $15,000
Day 6: $0
Day 7: $20,000
Day 8: $0
Day 9: $0
Day 10: $0

Under the previous shady rule of only paying for "new money", they take a snapshot on Day 1 so only amounts over $5,000 will get the bonus. Under their newest shady rule of paying the average balance, that would mean ($5,000 + $10,000 + $15,000 + $20,000) divided by 10 days. So that's $50,000 / 10 = $5,000 and so you get ZERO bonus interest.

In comparison, if they only use their original shady rule of taking a snapshot:
Day 1: ($5,000 - $5,000) * 0.05 / 365 = $0
Day 3: ($10,000 - $5,000) * 0.05 / 365 = $0.68
Day 5: ($15,000 - $5,000) * 0.05 / 365 = $1.37
Day 7: ($20,000 - $5,000) * 0.05 / 365 = $2.05

So there you have it, the difference is getting $0 versus $4.10 even with their shady practice of only paying on "new money".

That's a great example. But what if you actually had 0 balance at the start of the promotional period?
I also got that offer for one of my accounts and considering the history of this bank and its promos, i called them to clarify their promo.

The current offer is Nov 30 - Apr 30, 23 @5%. I called them with the following example , trying to figure out what would happen if I get a better offer at Tangerine for example.
I used one example:
Nov 30 balance = 0
Jan 1 - I deposit 100K
Jan 31 - withdraw 100K
May 17 payout - what would I get? I figured approx 540 in interest.

I spoke to an agent, who then consulted with a manager. none of them could technically give me an answer on how much interest i would earn. they explained of how the interest is calculated to their best ability but couldnt give me a number for this very simple scenario.
I was flabbergasted that people who work there can't figure out their own company's interest rate calculations and yet expect their customers to understand their fine print. What the #$%%?

I got their names for my records. wow!
Sr. Member
Aug 16, 2005
717 posts
131 upvotes
markdweasel wrote: I didnt get any emails from them - my family has 4 accounts with them. None of us have any significant amount there as of Dec 1. I wonder what the criteria is. I bet those who received promo had significant funds in the account as of the promo start date and they're going to use that "average" rule in getting around not paying promo bonuses.
Did you have any money in account as of dec 1?
I didn't get any either. Just login and see if you get a popup.
Sr. Member
Mar 7, 2008
807 posts
249 upvotes
Simplii is the only bank (as far as I know) which do NOT pay promo interest monthly. For this reason, I never accept their promotion. And, finally, cancelled their accounts couple years ago.
signature removed - advertising is not permitted in signatures
Sr. Member
Jan 21, 2012
585 posts
324 upvotes
mouseswimming wrote: Simplii is the only bank (as far as I know) which do NOT pay promo interest monthly. For this reason, I never accept their promotion. And, finally, cancelled their accounts couple years ago.
Same for me. I could not figure out/understand how they calculated the interest, they made it needlessly difficult and complicated. I had neve seen another bank had the same practice. They deferred the payment of the bonus interest few months later, made it even more difficult to trace the missing interest. I just had the feeling that Simplii did it on purpose and tried to fool their customers. I closed the account few years ago.
Deal Fanatic
User avatar
Sep 27, 2006
5059 posts
1937 upvotes
Not so easy there Ma…
markdweasel wrote: That's a great example. But what if you actually had 0 balance at the start of the promotional period?
I also got that offer for one of my accounts and considering the history of this bank and its promos, i called them to clarify their promo.

The current offer is Nov 30 - Apr 30, 23 @5%. I called them with the following example , trying to figure out what would happen if I get a better offer at Tangerine for example.
I used one example:
Nov 30 balance = 0
Jan 1 - I deposit 100K
Jan 31 - withdraw 100K
May 17 payout - what would I get? I figured approx 540 in interest.

I spoke to an agent, who then consulted with a manager. none of them could technically give me an answer on how much interest i would earn. they explained of how the interest is calculated to their best ability but couldnt give me a number for this very simple scenario.
I was flabbergasted that people who work there can't figure out their own company's interest rate calculations and yet expect their customers to understand their fine print. What the #$%%?

I got their names for my records. wow!
I wonder how a judge would rule on a possible class action lawsuit when a bank provides indecipherable or virtually indecipherable details on a promo that appears (in it's big print) to offer much more than what many people end up with.
Member
Jun 16, 2016
268 posts
297 upvotes
ottawa
markdweasel wrote: That's a great example. But what if you actually had 0 balance at the start of the promotional period?
I also got that offer for one of my accounts and considering the history of this bank and its promos, i called them to clarify their promo.

The current offer is Nov 30 - Apr 30, 23 @5%. I called them with the following example , trying to figure out what would happen if I get a better offer at Tangerine for example.
I used one example:
Nov 30 balance = 0
Jan 1 - I deposit 100K
Jan 31 - withdraw 100K
May 17 payout - what would I get? I figured approx 540 in interest.

I spoke to an agent, who then consulted with a manager. none of them could technically give me an answer on how much interest i would earn. they explained of how the interest is calculated to their best ability but couldnt give me a number for this very simple scenario.
I was flabbergasted that people who work there can't figure out their own company's interest rate calculations and yet expect their customers to understand their fine print. What the #$%%?

I got their names for my records. wow!
The math is straight forward but your number is incorrect.
Your 100k deposited Jan 1st and withdrawal Jan 31st, total period of 30 days. Total interest = 100K * 5% * 30/365 = $411.
There is indeed some variance. Jan 1 2023 is New Year holiday and a Sunday, Jan 2 2023 is also a holiday thus your deposit period is only 28 days instead. Don't blame HSBC staff why they couldn't do better since not everyone can get it right.
Churning: CIBC Aventura VI *2, CIBC Aeroplan VI
Newbie
Feb 10, 2009
74 posts
21 upvotes
franklin777 wrote: The math is straight forward but your number is incorrect.
Your 100k deposited Jan 1st and withdrawal Jan 31st, total period of 30 days. Total interest = 100K * 5% * 30/365 = $411.
There is indeed some variance. Jan 1 2023 is New Year holiday and a Sunday, Jan 2 2023 is also a holiday thus your deposit period is only 28 days instead. Don't blame HSBC staff why they couldn't do better since not everyone can get it right.
wait, what? Are you implying you don't earn interest on holidays?
Member
Dec 27, 2017
411 posts
300 upvotes
Ontario
Didds wrote: wait, what? Are you implying you don't earn interest on holidays?
I'm guessing the point was that the deposit wouldn't be credited until January 3rd.
Deal Addict
May 21, 2004
2921 posts
2182 upvotes
GTA
Didds wrote: wait, what? Are you implying you don't earn interest on holidays?
Not now but I'm sure Simplii will do that soon enough. They just need a way to sell it as if it's a feature.
Deal Expert
Jan 7, 2002
26740 posts
24181 upvotes
Waterloo, ON
Britex wrote: Not now but I'm sure Simplii will do that soon enough. They just need a way to sell it as if it's a feature.
If you're so concerned that Simplii is ripping you off then you need to do something about it rather than just bitch about it. First confirm that they're really ripping you off, then escalate to the media and/or the federal banking regulators to get it fixed.

As for not paying interest on holidays, that would be highly unusual if not also highly illegal.
veni, vidi, Visa
Member
Jun 16, 2016
268 posts
297 upvotes
ottawa
Didds wrote: wait, what? Are you implying you don't earn interest on holidays?
you definitely earn interest on holidays.

Some banks may not process the transaction until the next business day if a deposit is made on a holiday or weekend. I know RBC will process but CIBC won’t.
Churning: CIBC Aventura VI *2, CIBC Aeroplan VI
Newbie
Feb 10, 2009
74 posts
21 upvotes
franklin777 wrote: you definitely earn interest on holidays.

Some banks may not process the transaction until the next business day if a deposit is made on a holiday or weekend. I know RBC will process but CIBC won’t.
Even if you deposit with a cheque using mobile deposit? Because it shows in your account (with a hold, but it shows) right away. With Simplii anyway.

Top