Best Tangerine Savings Accounts

Tangerine Savings Accounts Compared: Are the Alternatives Better?

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Last updated on October 24, 2022 Comments: 7

Tangerine Bank, referred to as simply Tangerine by most is a subsidiary of Scotiabank that specializes in consumer-friendly credit cards, savings accounts, and chequing accounts for Canadians. The bank provides some unique ways for customers to benefit from their spending and saving efforts, exemplified by products like the Tangerine Money-Back card, which allows cardholders to choose which purchase categories they earn the most rewards in.

A creative take on banking grants Tangerine customers some benefits that they won’t find even at the largest traditional financial institutions. However, there are also alternative products on the market that Canadians prefer. We’ve taken a look at Tangerine’s savings accounts and compared them to others on the market to present you with the best alternative in case Tangerine cannot provide for all your needs.

Best Tangerine Savings Accounts

Savings accounts from Tangerine are some of the most convenient to bank with, because they don’t impose any minimum balances, fees, or service charges whatsoever. At the end of the day, customers want saving money to be simple and easy, and that’s exactly what Tangerine accomplishes. Discover the best of this excellent bank’s savings accounts below, including the Tangerine TFSA, Retirement Savings Plan, and more.

Tangerine Savings AccountBase Interest RateFees
Tangerine Savings Account0.40% $0
Tangerine Tax-Free Savings Account (TFSA)0.40% Deposits and interest tax-free $0
Tangerine RSP Savings Account0.40%
Deposits to RSP deductible from yearly income
$0

Tangerine Savings Account

tangerine Savings AccountOne of the best Tangerine savings accounts is also the simplest. With no fees, minimum balances or surcharges, saving money requires no hesitation or extra thought, and is easy with a favourable interest rate.

Without fees or minimums, it’s simple to withdraw or move your money between accounts. It’s also safe, as Tangerine makes deposits of up to $100,000 eligible for CDIC insurance. For customers who need to save at a competitive rate, but don’t want to actively manage their money or worry about hidden charges for doing so, the Tangerine Savings Account is ideal.

  • 0.40% rate
  • No fees, surcharges, or minimums

Our Pick for the Best Alternative Savings Account

Tangerine offers an excellent savings account for Canadians looking for a mostly online bank that is backed by a big name (Scotiabank), but if you’re on the hunt for the highest savings account rates, consider our pick for an alternative, the Savings Plus Account by EQ Bank.  EQ Bank is an online-only bank offering users 2.50%* interest with no monthly fees, free transactions, and no minimum balance. That rate isn’t promotional, that’s their everyday interest rate. EQ Bank deposits are eligible for CDIC insurance, which protects your deposits up to $100,000, so you don’t need to fear for your money if this online bank is new to you.

* Interest is calculated daily on the total closing balance and paid monthly. Rates are per annum and subject to change without notice.

Tangerine Tax-Free Savings Account (TFSA)

tangerine TFSA AccountPut some extra power behind your savings by getting a great rate, and earning interest without the burden of taxes. The Tangerine TFSA is for Canadians above the age of majority who want to put money aside and let it accrue interest at 0.40%, and then not pay the standard tax on interest when they withdraw the money later. While contributions to a TFSA aren’t deductible and an annual ceiling is set at $5,500, the deposits and the interest they earn are totally exempt.

Add in Tangerine’s absence of fees, surcharges and minimums and savings are accelerated further. Even better, customers banking with Tangerine can take advantage of the bank’s Automatic Savings Program, which they can use to set up automatic withdrawals from their other bank accounts and maximize their tax-free savings each year. For those who plan their finances strategically, a TFSA is a necessary tool, and Tangerine’s option represents one of the very best in the Canadian market.

  • Competitive 0.40% rate
  • No fees, surcharges, or minimums
  • Automatic Savings Program

Our Pick for the Best Alternative TFSA

The power of the TFSA is its ability to let your money grow completely tax-free. But if your money isn’t growing due to low interest rates, what’s the point of using a TFSA? Maximizing your tax-free growth is why you should care about interest rate offered by your TFSA, and in this category Tangerine is competitive, but not best in class. That honour goes to EQ Bank. The EQ Bank TFSA Savings Account charges zero fees, has no minimum balance requirements, and earns customers an impressive 2.50%* interest. If you have no immediate need for your money, you could also lock your cash into EQ Bank TFSA GIC, with terms starting at 3 months.

* Interest is calculated daily on the total closing balance and paid monthly. Rates are per annum and subject to change without notice.

Tangerine Retirement Savings Plan (RSP)

tangerine RSP AccountSaving for retirement is straightforward and lucrative when you bank with Tangerine. The Tangerine RSP allows those with their eyes on the future to automatically make maximum contributions each year, and earn interest at an excellent rate. Moreover, all deposits to one’s RSP are deductible from yearly income, helping to reduce an account holder’s tax burden while gaining access to compound interest as well.

Customers of Tangerine, as always, can optimize how money moves through their various accounts inexpensively. Exemption from fees and other charges, mandated minimum balances and other restrictions make building a nest egg easier than ever. Combine it with the Automatic Savings Plan to ensure that you contribute your yearly maximum to a retirement account without any extra effort needed.

  • Tax-deductible deposits
  • 0.40% interest
  • Automatic Savings Plan

Our Pick for the Best Alternative RSP

While we always recommend investing your retirement money with a low-fee platform such as a robo advisor, there are some instances where it is sensible to keep part of your retirement savings in cash. That said, you don’t need to subject yourself to low interest rates in the name of keeping cash in your RSP. While Tangerine’s promotional rate of 2.10% is competitive, it expires after 5 months. Since this is your retirement savings we’re discussing, you should have a plan for it beyond 5 months from now. In this case, it’s sensible to choose an EQ Bank RSP Savings Account, which gives you the same perks you expect from Tangerine such as no account minimums, no transaction fees and no monthly fees.

Which to Choose?

There is no doubt that Tangerine bank offers lucrative perks in terms of their product suite and capabilities. Tangerine has credit cards with cash back earnings and allows you to open checking and savings accounts. For a more all-in-one option, Tangerine might still be the best choice. However, if you’re inclined to go the fully digital route and get better rates for your savings, EQ Bank has Tangerine beat by quite a bit.

Author Bio

GreedyRates is Canada’s go-to resource for all things personal finance. Our expert articles and videos cover every topic under the financial sun, including credit cards, credit scores, loans, bank accounts, budgeting, investing, RSPs, TFSAs, GICs, taxes, and more. Want our advice on a personal finance issue? Send us an email at [email protected] and we’ll gladly give you some free tips.

Article comments

7 comments
Jesse Jensen says:

I’m not sure what this writer was smoking when they wrote this, but 0.25% is neither competitive with current online/traditional banks. I’ve been with Tangerine for the last 4 years and their rates have severely gone downhill. Unless you’re a new customer, don’t bother with them.

Allen Jones says:

I agree with Jayne – ING / Tangerine is NO LONGER competitive and like Jayne I joined Tangerine/ ING way back when and so far I have moved over $20,000 to a Mackenzie floating rate fund where I get 2.6% +++ and that is where I plan to move the rest of our ING funds after I post this note

The GreedyRates Team says:

Allen,
We appreciate the input! At the end of the day, you’re free to chase the best returns possible, so if you find something better than what we’ve reviewed above then we wholeheartedly encourage you to pursue it. Remember that with these more agile online funds and organizations, you’re often seeking greater returns at the expense of customer support or the ability to enter a branch and have someone talk you through an issue face-to-face. However, if you can reliably double your interest rate then few would argue against this opportunity. Enjoy!

GreedyRates

Jayne Huddleston says:

Tangerine must have paid for this post because 1.2% is NOT competitive among online banks. I have had accounts at Tangerine since it was ING and I was with them since ING came to Canada. Currently, Tangerine is treating their new customers better than their long-time loyal customers, by offering a 2.75% bonus rate. They’d be better to offer a competitive rate to all customers. I have moved most of my money out of it to the many CDIC insured online banks that now pay 2.3 and 2.4%. Tangerine will have to pay a fair rate to get my business back.

The GreedyRates Team says:

Hi Jayne,

Great observation, and this ties into the compromise that many make when giving their business to banks that aren’t online-only. With lower overheads given the absence of any physical branches or locations (and the quality of service that comes with them) banks like Alterna, EQ, and motusbank are indeed able to offer around 1.00% more interest to savings accountholders.

It’s not that Tangerine isn’t treating their customers well—the opposite in fact. A savings account interest rate of 1.20% is pretty competitive with Big Five banks, and you must remember that it also lets you add another 2.00% cash back purchase category to your Tangerine MoneyBack Credit card (if applicable).

At the end of the day, it’s your decision whether you want to abandon physical banks and go online for a better rate. If you’re planning on not spending your money and think you can lock it for 12 months, GICs from these online banks can get you near 3.00%! Sometimes having personal support is useful, though, so it’s your decision. That’s not to say motusbank doesn’t offer great support, but at the end of the day, the only thing that’s important is that Canadians are able to make this choice.

GreedyRates

reginald bradley says:

what about withdrawals from a tfsa account

The GreedyRates Team says:

Hi Reginald!

We appreciate your question about TFSAs, or Tax-Free Savings Accounts, but more specifically the Scotiabank TFSA account. As far as withdrawals go, TFSAs aren’t as restricted as an RSP account, for example. They’re meant to help people save cash for any number of purposes, not just retirement. Therefore, it makes sense that a TFSA accountholder is table to withdraw his or her money at any time, and in whatever amount they want. Moreover, they won’t pay taxes on this withdrawal or lose yearly contribution room (one can re-deposit their withdrawn sum without penalty later). Some restrictions might apply to the withdrawal depending on the investment assets chosen by the accountholder, however, so keep this in mind. Thanks!

GreedyRates