Canadians typically need two types of accounts: one for everyday spending and one for savings. A chequing account handles the first; a High-Interest Savings Account handles the second. Using both together — and using each for its intended purpose — maximizes what you earn without sacrificing convenience.
At a Glance: HISA vs. Chequing Account
| Feature | HISA | Chequing Account |
|---|---|---|
| Primary purpose | Saving money | Daily transactions |
| Interest rate | 3.0–5.5% | 0–0.1% |
| Monthly fee | Usually $0 | $0–$30 (waivable) |
| Debit card | Usually no (exceptions exist) | Yes |
| Bill payments | Usually no | Yes |
| Cheque writing | No | Yes |
| Direct deposit | Usually no | Yes |
| Interac e-Transfer | Outgoing only (varies) | Yes |
| CDIC insured | Yes | Yes |
| TFSA option | Yes | No |
| Number of transactions | Unlimited (no limit) | Limited or unlimited depending on plan |
What a Chequing Account Is For
A chequing account is your financial transaction hub:
- Direct deposit from your employer or CRA lands here
- You pay rent, utilities, and bills from this account
- Your debit card draws from this account for in-store and online purchases
- Automatic monthly payments (gym, subscriptions, insurance) debit from here
- You write cheques (if you still use them) from this account
Interest: Big 5 chequing accounts pay no interest. Some credit union chequing accounts pay a small rate. This is intentional — a chequing account is not a savings vehicle.
What a HISA Is For
A HISA is where money lives when you don’t need it right now:
- Emergency fund (3–6 months of expenses)
- Short-term savings goals (vacation, car, home renovations)
- Down payment fund
- Money between investments
- Tax bill fund for self-employed Canadians
- Holding savings while deciding where to invest
Interest: 3–5% annually (as of 2026) — roughly 30–500× more than a Big 5 bank savings account.
How Much Should Be in Each Account?
Chequing account: Enough to cover upcoming bills and a small buffer. A common rule: one month’s fixed expenses + a $500–$1,000 buffer. Having much more here means money sitting idle earning nothing.
HISA: Everything else that isn’t invested. Your emergency fund, specific savings goals, and any cash you’re holding short-term.
Example for someone with $20,000 in savings and $3,000 monthly expenses:
| Amount | |
|---|---|
| Chequing account | $3,500 (1 month’s expenses + buffer) |
| HISA (emergency fund) | $9,000 (3 months’ expenses) |
| HISA (vacation goal) | $3,000 |
| HISA (home renovation goal) | $4,500 |
The Cost of Keeping Savings in a Chequing Account
Scenario: $15,000 sitting in a chequing account that pays 0.05% vs. a HISA at 4.5%
| Account | Annual Interest | After 5 Years |
|---|---|---|
| Chequing at 0.05% | $7.50/year | $37.50 |
| HISA at 4.5% | $675/year | ~$3,692 (compounded) |
| Difference | $667.50/year | ~$3,655 |
Leaving $15,000 in a chequing account for 5 years costs nearly $3,655 in forgone interest.
Accounts That Blur the Line
Some accounts aim to combine high interest with chequing functionality:
EQ Bank Personal Account: Functions as a HISA with a competitive interest rate, Mastercard prepaid card for purchases, and bill payment capability. Not a full chequing account (no cheque writing, no direct deposit for payroll at most employers) but closer than a traditional HISA.
Wealthsimple Cash: High-interest account with a Visa debit card. Competitive rate; works for some day-to-day purchases.
Tangerine Chequing: Low interest but some transaction capability; not a true HISA.
For most Canadians, keeping a traditional chequing account at one institution (for full functionality) and a HISA at an online bank (for best rates) is the most practical setup.
Transferring Between Chequing and HISA
Moving money between your chequing account and HISA:
- EFT (electronic funds transfer): 1–3 business days; free
- Interac e-Transfer: Usually same day; may count as a transaction
- Internal transfer (same bank): Usually instant
If you’re keeping your emergency fund at a different institution from your chequing account, transfers will take 1–3 days. This is actually a mild benefit — the small friction prevents impulse spending from the emergency fund.