As a Wealthsimple client, you are entitled to coverage so that your money stays your money. Specifically, the funds in your Cash account are placed in Trust with up to three Schedule 1 Canadian banks. As such, CDIC protection against the failure of these banks extends to Wealthsimple Cash account holders for up to $300,000 CAD.
How it works
General coverage with Wealthsimple Cash and Save accounts
Through CDIC, member financial institutions, like banks are able to insure up to $100,000 CAD per beneficiary, per institution, per deposit category. At Wealthsimple, we instead hold any balance in your Cash or Save account(s) in trust for you (which is a fancy way of saying, on your behalf) with members of the CDIC.
Increased coverage in your Cash account
We have partnered with a number of CDIC-member, Canadian Financial Institutions to take advantage of a combined CDIC-eligible coverage amount (up to $300,000 CAD) for our clients in their Cash account.
This means that we hold our clients’ Cash account balances over $100,000 CAD in trust with multiple members of the CDIC, allowing the extension of coverage to funds in your cash account for up to $300,000 CAD, against failure of any of Wealthsimple’s partner banks.
Clients with Cash and Save accounts
For Wealthsimple Cash and Save clients, any balance in your account(s) is held in trust for you with members of the Canada Deposit Insurance Corporation (CDIC), a federal Crown corporation. CDIC protects eligible deposits held at CDIC member institutions in case of a member institution’s failure.
The funds in your Save account are eligible for up to $100,000 in coverage less the balance you hold in your Wealthsimple Cash account.
Let’s walk through two examples.
Example 1
Eligible coverage in Cash
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All $150,000 is eligible for coverage
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Deposits up to $300,000 are eligible for coverage, meaning you could deposit an additional $150,000 and have it eligible for coverage by CDIC
Eligible coverage in Save
- $0 is eligible for coverage
- $100,000 in potential eligible coverage less $150,000 in your Cash account means $0 in coverage for Save
Example 2
Eligible coverage in Cash
- All $75,000 is eligible for coverage
- Deposits up to $300,000 are eligible for coverage, meaning you could deposit an additional $225,000 and have it eligible for coverage by CDIC
Eligible coverage in Save
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$25,000 is eligible for coverage
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$100,000 in potential eligible coverage less $75,000 in your Cash account means $25,000 eligible for coverage in Save
Frequently asked questions
Which partner banks are you using?
We partner with CDIC-member, Canadian Financial Institutions. From a confidentiality perspective, we cannot disclose the names of the partners we use.
What if my Cash balance exceeds $300,000?
Any amounts over your CDIC coverage are not eligible for additional coverage. Should your Cash account balance exceed your CDIC coverage, we recommend that you speak to one of our advisors. Our advisors are on hand to offer free financial advice at any stage and they are best positioned to advise on alternative options for your excess cash.
Why isn't Wealthsimple listed on the CDIC website?
Wealthsimple isn't a CDIC member institution, however, we partner with CDIC members to hold your funds in trust, ensuring coverage is passed onto you.
How are my funds split between the partner banks that you are using?
The funds are split to maximize your eligible CDIC coverage.
I’m a client with more than $300K in liquid cash and I want to keep it somewhere with high yield, low risk, and eligibility for coverage. What should I do?
In this case, we recommend reaching out to our premium support team. They can help put you in touch with an advisor, who will be able to work with you to do what’s best for your personal financial situation and goals.
Will this impact deposit or withdrawal timelines?
Deposit and withdrawal timelines will not be impacted by this initiative. Instead, you can enjoy the same deposit or withdrawal timelines with the increased security of CDIC-eligible coverage of up to $300k on your Wealthsimple Cash accounts.
If I’m an existing client at one of the CDIC-member Canadian Financial Institutions and have $100k there in cash, do I risk not being eligible for as much coverage with Wealthsimple?
No, your Wealthsimple coverage will not be impacted by cash held in your own name at other financial institutions.
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