I have a very boring and very predictable answer when people ask me where they should stash things like their house down payment savings.
“Are you in Canada? Then my answer is EQ Bank, no question.”
I recommend them in comments and emails and posts so often for a reason: they’re who I actually use to store all my big savings goals. That included our house down payment savings and our closing costs, and these days, it’s where I keep my emergency fund and my tax savings.
But instead of leaving it at that, I wanted to put together a full review of EQ Bank to help break down why I recommend them, and address some of the most common follow-up questions I get when I do.
EQ Bank Review: You might be wondering…
- What is EQ Bank?
- Who can use EQ Bank?
- Who should use EQ Bank?
- What’s the experience like?
- What should you do after using EQ Bank?
- What’s the best part about EQ Bank?
- What’s the worst part about EQ Bank?
- How much does EQ Bank cost?
- Any hidden fees or tricky parts?
What is EQ Bank?
If you’ve heard of them before, it’s probably for their ultra-competitive interest rates: they pay 2.30% interest* on your everyday savings, and more than that on their GICs depending on how long you lock your money in for.
Who can use EQ Bank?
Who should use EQ Bank?
I’m just going to call it right now: if you are saving for a short-term money goal, literally any short-term money goal, you should have an EQ Bank account.
Saving for a house down payment? EQ Bank account.
Saving an emergency fund? EQ Bank account.
Saving for taxes if you’re a freelancer? EQ Bank account.
Saving for a big vacation or a wedding? EQ Bank account.
Literally any time anyone asks me where to keep their short-term savings, I always tell them to open an account with EQ Bank for two main reasons.
The first one is obviously the interest rate. If you have a lot of money just sitting in account, because it’s supposed to be sitting in an account, it might as well earn you more money.
But there’s a bigger benefit than the dozens of dollars you could be making every month (yes, dozens, seriously). If you have that much money and you want to make sure it stays in savings, it’s much easier on a psychological level to forget it’s there when you don’t see it every day.
For accounts you’d really rather not tap into on a monthly basis, separating them out into your EQ Bank account and hiding them behind one extra login can be the difference between spending them and finally sticking to your savings goals.
What’s the experience like?
Really, really easy to use.
Because EQ Bank doesn’t try to be everything to everyone, the interface is gloriously simple. It’s savings accounts. You can add and withdraw money, you can set up clear savings goals, you can see your recent transactions, and keep tabs on how much further you have to go until you hit your goal.
Is it the most unbelievably slick interface in the world? No, but it’s pretty great, and it does everything you could want to do in a simple, straightforward way.
To set up an account, you’ll need to validate your identity, and the easiest way to do that is to connect your EQ Bank account with your existing bank account. Not only does this skip dealing with physical documents, it connects your existing account to your new EQ account.
What should you do after you’ve set up an account at EQ Bank?
Since I’m going to assume you opened an account to save some money—they’re savings accounts, after all—there are two key things you’re going to want to do once you’ve connected an account and authenticated with your existing bank account.
One, set up your savings goal. All you have to do is put in an amount you want to save, and the date you want to save it by. EQ Bank will keep track of your goal for you, show you a handy progress bar (motivating af!) and you’ll easily be able to see how you’re doing—and when you’re done.
Two, set up an automatic contribution. Once you’ve got an account with a goal, the best next step is to automate your savings. You can set up recurring savings contributions from your external account to align with your pay schedule, so you literally don’t have to think about it again until the money is saved up and ready.
What’s the best part of EQ Bank?
There is a lot that I like about EQ Bank, but I’ve got to say, the interest is baller. Right now, I’ve got two main savings accounts with them, holding my emergency fund and my tax savings.
Instead of paying bank fees to stash my money somewhere, EQ Bank is currently paying me about $25 in interest every single month.
Twenty-five dollars. Every month! That’s like one full Starbucks card reload!
The high interest rates you can earn on your savings are an easy way to optimize your money, and they’re nothing to sneeze at. The interest is paid out at the start of every month, so it compounds, too.
What’s the worst part of EQ Bank?
Because it’s a separate bank, transferring money to and from your “primary” bank will take a few days.
Just like it would from any bank to any other bank.
It’s really a very small hassle, but “how is the transfer process?” is something that I get asked more than anything else about EQ Bank. So here is the low down on moving money in and out.
Once you’ve linked the accounts, moving money into your EQ Bank account is as simple as setting up a one-time or recurring transfer in your EQ account. The great part is that while it’ll take a few days for the money to be available in EQ Bank, they recognize the transfer as soon as you make it—so you start earning interest right away. Sah-weet.
Moving money out is a similar process. You just set up a transfer from your EQ Bank account to your external account, and hit “Send”. It’ll take the same few days to actually show up in your other account, so make sure you plan accordingly.
When I withdrew money for our house down payment and closing costs, I made sure to transfer the money over a week ahead of time when it was being drawn from my chequing account. When I could put it on a credit card, I’d do that, initiate the transfer, and the money would be easily available before my credit card needed to be paid off.
How much does it cost?
Seriously, it’s free. You can have up to four savings accounts, all of which are free, and you get five free Interac e-Transfers® every month. There’s no minimum account size, no monthly fees, and you have unlimited bill payments and EQ-to-EQ transfers if you want either.
You can link up to 10 accounts for free, and transfer money to and from your linked bank accounts for free.
Any hidden fees or tricky parts?
There was always one thing that I had to remind myself once I set up my automatic contributions from my chequing account.
While the savings contribution will show up right away in EQ Bank, it usually takes a day or two for the money to actually come out of your chequing account. So if you’re watching your bank account like a hawk, you’ll get paid, have your other automatic contributions come out, pay your bills, and see a number left over in your account at the end of payday.
You just have to remember that your other automatic contributions are going to come out a day or two later, so you need to remember that some of that “leftover” money is already spoken for.
But on the bright side there are no hidden fees!
Also this is a very minor hassle for how major some hassles can be with financial products.
Can you tell I love EQ Bank? Because I really love it, and suggest it to every Canadian with a savings goal. There’s no reason you need to leave thousands of dollars sitting around earning pennies in interest for years at your regular bank when they could be earning dollars at EQ Bank—especially if getting that chunk of money out of sight will help you stick to your savings goals.
It’s a total win-win.