Melissa Tait/The Globe and Mail
 
 

From April, 2023, through to the middle of last July, me and other clients of the alternative bank Motive Financial made a cool 4.1 per cent on our savings.
 
 

Motive cut its savings rate as interest rates fell, but it still offers a competitive 2.25 per cent on a no-fee savings account you can use to pay bills and send e-transfers. Better rates are available from a handful of other alt banks, but you’re miles better than the 0.25 to 0.8 per cent interest from big bank savings products.
 
 

Motive exemplifies the benefits of using an alternative bank, and the negatives as well. From time to time, alternative banks get acquired by big banks with no interest in paying competitive interest. Or, they bow out of the competition to provide top rates.
 
 

At some point in the weeks ahead, Motive will disappear into the arms of National Bank of Canada. National closed its purchase of Motive’s parent, Canadian Western Bank, in February and has notified Motive clients that their accounts will be moved to similar National products.
 
 
 

“We are committed to making sure that as clients migrate, they will continue to benefit from similar rates (based on the rates held at the time of client migration) and digital simplicity,” National Bank said in an e-mail response to a query about what’s ahead for Motive clients.
 
 

National Bank’s website shows a rate of 0.75 per cent for its High Interest Savings Account, which is designed just for saving. If you want to pay a bill from your savings and avoid a fee, you have to transfer the money into a chequing account.
 
 

A couple of examples where big banks bought alternative banks and clients ended up with less interest include Bank of Nova Scotia’s acquisition of ING Direct, which became Tangerine, and the RBC acquisition of Ally Financial.
 
 

Examples of alternative banks that aren’t in the game of offering top rates anymore include EQ Bank, which has added a lot of new features while currently paying 1.25 per cent as a base rate of interest. You can get 3.5 per cent if you have your pay directed deposited.

 
 

Wealthsimple has cut its base savings rate back to 1.75 per cent from 4 per cent last summer. Clients with assets of $100,000 and up get 2.25 per cent and those with $500,000 or more get 2.75 per cent.
 
 

Whatever alternative bank you deal with, be ready for great rates to fade for one reason or another. Fortunately, there’s always another alternative bank still willing to offer something better. The latest crop includes PC Financial, offering 3.5 per cent on the PC Money account.

 
 
Callout: Has the trade war derailed your retirement plans?
 
Get some free financial advice from The Globe and Mail by e-mailing finfacelift@gmail.com to be part of our Financial Facelift series. You don’t have to share your real name and our photographers will obscure your identity in one of our trademark Financial Facelift photos. Here are some recent facelifts for you to read. We’re especially keen to hear from Canadians worried about how the trade war with the U.S. will impact their ability to retire. Have you changed your investment strategy? Your retirement timeline? Your travel plans? Hopefully our advice can help you weather these stormy times and ensure a secure financial future.
 
 
Subscribe to Carrick on Money
 
Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.
 
 

 
 
 
Staycation nation
 
Thoughts on the good you can do by vacationing in Canada this year instead of the U.S. To entice people to travel domestically this summer, the Liberals promised in the recent federal election campaign to introduce a Canada Strong Pass offering travel discounts for young people and families. Now for a look at Top 10 places to visit in Canada.
 
Look for the CFP
 
A brand new certified financial planner, or CFP, explains the value of the designation. There are several designations in financial planning, but this is the one I look for as a financial journalist.
 
The ideal financial planner
 
This is kind of a financial industry insider piece – a call for financial planners and investment advisers to take a broader approach with clients than simply managing investments. I’m including it here because it might open your mind about what a good planner or adviser can do for you. What the ideal planner or adviser provides: “Guidance on how to live meaningful, financially secure lives in a world that feels increasingly unpredictable.”
 
Toronto’s ‘dog crate condos’
 
The tiny 500-square-foot condo units found in the urban Toronto market have been derisively called “dog crates.” This blog post explains how developers came to build such small condo units, and why they have a role in the city’s real estate market.
 
 
Podcast fans
 
Subscribe to Stress Test on Apple podcasts or Spotify.
 
 

 
 
 
 
Question
 
What are your views on structured notes?
 
Rob says
 
Thumbs down. Here’s something I wrote recently on this topic.
 
 

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.