BMO's High-Interest Savings Options

BMO offers high-interest savings accounts, but the interest rate and account features depend on which product you choose and how you bank with them. BMO's main high-interest option is the BMO High Interest Savings Account, which is available online and through some branches. The rate changes regularly based on market conditions, so the amount you earn on your balance shifts over time.

BMO also offers savings products through its online banking division, BMO Alto, which sometimes has different rates than the main BMO branches. If you already have a BMO chequing account or other products with them, you may see different rates or offers than someone opening an account for the first time.

The key difference between a regular savings account and a high-interest savings account is the rate of return. A high-interest account pays you more money on the balance you keep in it, but usually comes with limits on how many times you can withdraw per month or requires you to keep a minimum balance.

Key Takeaways

  • BMO offers a High Interest Savings Account through both branches and online, with rates that change based on market conditions.
  • BMO Alto, BMO's online banking division, may offer different rates than traditional BMO branches, so comparing both is worth your time.
  • High-interest savings accounts typically limit withdrawals or require minimum balances, so read the account rules before opening.
  • The interest rate you receive depends on the account type, how much you deposit, and current market rates at the time you open.

How BMO's High-Interest Savings Account Works

When you open a BMO High Interest Savings Account, you deposit money and BMO pays you interest on that balance. The interest is calculated daily but usually paid monthly or quarterly, depending on the account. This means your money grows without you doing anything — you straightforward keep the account open and maintain your balance.

The account comes with a debit card and online access, so you can check your balance and make transfers through BMO's website or mobile app. However, most high-interest savings accounts have rules about how often you can withdraw money. Some accounts limit you to a certain number of withdrawals per month, while others may charge a fee if you exceed that limit.

BMO also offers different versions of savings accounts depending on whether you bank online only or use a branch. Online accounts sometimes have higher interest rates because BMO has lower costs to run them, but you cannot walk into a branch to deposit cash or speak with someone in person about your account.

Comparing BMO's Rates to Other Banks

BMO's interest rates change regularly, so the rate you see today may not be the rate you get next month. To know what BMO is currently offering, you need to check their website or call a branch directly — the rate varies and is not fixed in this guide.

Other banks, including online-only banks and credit unions, also offer high-interest savings accounts. Some online banks pay higher rates than BMO because they have fewer physical locations to maintain. Credit unions sometimes offer competitive rates to their members. The best account for you depends on whether you value having a local branch, how much money you plan to keep in savings, and what rate each bank is offering at the time you open.

If you already have a chequing account or mortgage with BMO, opening a savings account with them may be simpler because you can manage everything in one place. However, that convenience may cost you a lower interest rate than you would get elsewhere.

What You Need to Open a BMO High-Interest Savings Account

To open a BMO High Interest Savings Account, you will need a government-issued photo ID (such as a driver's license or passport) and proof of your current address. Proof of address can be a recent utility bill, lease agreement, or bank statement with your name and address on it.

You will also need to provide your Social Insurance Number (SIN) so BMO can verify your identity and report interest income to the Canada Revenue Agency. If you are opening the account online, you may be able to upload these documents through BMO's website. If you are opening in a branch, bring the originals or copies with you.

Some accounts require a minimum opening deposit — the amount varies by account type. Check with BMO directly about what they require at the time you plan to open, since these rules change.

Monthly Fees and Account Costs

BMO's High Interest Savings Account may have a monthly fee, or it may be free depending on the account type and your banking relationship with BMO. Some accounts waive the fee if you keep a minimum balance or if you have other products with BMO, such as a chequing account or credit card.

Online-only accounts through BMO Alto typically have no monthly fee, but the trade-off is that you cannot use a physical branch. Branch-based accounts may charge a fee unless you meet certain conditions, such as maintaining a minimum balance or having direct deposit set up.

Beyond the monthly fee, you should ask about withdrawal limits and whether there are charges if you exceed them. Some accounts allow unlimited withdrawals, while others charge a fee after a certain number per month. These rules matter if you plan to move money in and out frequently.

How Interest Is Calculated and Paid

BMO calculates interest on your account balance daily, which means the interest is based on how much money you have in the account each day. If you deposit $5,000 on the first of the month and withdraw $2,000 on the fifteenth, the interest for that month is calculated on both amounts for the days they were in the account.

Interest is usually paid monthly or quarterly, depending on the account. When interest is paid, it is added directly to your account balance, so your balance grows. This is called compound interest — you earn interest on your original deposit and then earn interest on that interest in the next period.

BMO reports all interest you earn to the Canada Revenue Agency, and you will receive a tax slip (T5) at the end of the year showing how much interest you earned. You must report this interest as income on your tax return.

Online Banking vs. Branch Banking with BMO

BMO offers high-interest savings accounts both online and through physical branches. The online option, BMO Alto, is designed for people who are comfortable managing their account through a website or app and do not need to visit a branch. Online accounts often have higher interest rates and lower fees because BMO's costs are lower.

Branch-based accounts let you walk in, speak with someone, and deposit cash or cheques in person. This is helpful if you receive cash payments or prefer to handle banking face-to-face. The trade-off is that branch accounts may have lower interest rates or higher fees than online accounts.

You can also use both — some people keep a high-interest savings account online for long-term savings and a regular savings account at a branch for everyday access. BMO's online and branch systems are connected, so you can transfer money between them through your online banking.

Frequently Asked Questions

What is the current interest rate on BMO's high-interest savings account?

BMO's rates change regularly based on market conditions and the type of account you open. To find the current rate, visit BMO's website, call a branch, or speak with a representative online. Rates for online accounts (BMO Alto) may differ from branch accounts.

Can I withdraw money whenever I want from a BMO high-interest savings account?

Most BMO high-interest savings accounts allow withdrawals, but some have limits on how many you can make per month without a fee. Check the account rules before opening to understand any withdrawal restrictions that explore to the specific account you choose.

Is my money safe in a BMO high-interest savings account?

Yes. BMO is a member of the Canada Deposit Insurance Corporation (CDIC), which means deposits up to $100,000 per account holder are protected if the bank fails. Your high-interest savings account is covered by this protection.

Do I need an existing BMO account to open a high-interest savings account?

No, you can open a BMO High Interest Savings Account without having any other BMO products. However, if you already have a chequing account or other products with BMO, you may see different rates or fee waivers, so it is worth asking about.

How does BMO Alto's rate compare to the regular BMO high-interest savings account?

BMO Alto and regular BMO accounts may offer different rates at any given time. Compare both options on BMO's website or by calling to see which rate is higher when you are ready to open an account.