A couple weeks ago the Bank of Montreal (BMO) and Sobeys announced the launch of two new online banking products. The new products were in fact a no fee chequing account and a savings accounts – the BMO Club Sobeys Savings Account.
Today I will go through what the BMO Club Sobeys Savings Account has to offer and how it compares to other savings accounts.
What interest rate do you get with the BMO Club Sobeys Savings Account?
With eh BMO Club Sobeys Savings Account you are able to have:
- BMO’s highest savings account interest rate – starting with a balance of $5,000.
- Free deposits and transfers into your account
- Easy and instant access to your funds at any time
- No monthly fee.
As you can see, the features are pretty decent; the highest savings account interest rate BMO has to offer is not a bad rate, considering that you are able to use the savings account at no cost.
Currently, the highest rate being offered is 1.30%; that is definitely not a bad rate for anyone to put their money into.
Another great feature offered by the BMO Club Sobeys Savings Account is PowerSwitch – it is a free service available to all BMO customers.
How does the interest rate compare to other banks?
I decided to take a look at a few savings accounts that some of the other big banks had to offer.
My search brought me to the Toronto-Dominion Bank (TD); BMO offered a slightly better rate than TD. TD offers anywhere form 0.25% to 1.20% in terms of interest rate and to get their highest rate, you need to have at least $5,000 sitting in your savings account.
I took a look at what the Royal Bank of Canada (RBC) had to offer in terms of a savings account interest rate, and found that they offer 1.20%. (this is the rate on their eSavings account).
Now BMO’s Club Sobeys Savings Account does offer 1.30%, but you need to have a balance of $5,000 in order to acquire the rate. If you do not have the required base amount of money, then you earn nothing. That is right, there is no interest rate if you have anywhere from $1 – $4999.99.
Personally, I always thought that the purpose of a savings account was to save money and earn a bit of interest on it. BMO’s Club Sobeys Savings Account seems to be a savings account that requires you have already saved some money before you start using it.
The rate might be good, but I would have preferred if they offered some kind of interest rate before the $5,000 mark.
Well either way, if you have the money ($5,000) this account might be a great choice for you seeing as you can start earning interest on it, however if you do not, I would not recommend using this account at all seeing as you earn absolutely nothing prior to depositing $5,000.
What do you think of the BMO Club Sobeys Savings Account?