Wealthsimple offers three different annual interest rates on the balance in your Cash account. The rates are annualized rates, calculated daily, and paid monthly directly into your Wealthsimple Cash account.
Below are the three interest rates offered, along with how you will qualify for each:
|
Interest rate* |
How you qualify |
|
1% |
All clients qualify as soon as they open a Cash account. |
|
3% |
Enable direct deposit in your Cash account and set up a direct deposit of at least $500 per paycheque. |
|
4% |
Have at least $100,000 in net deposits** throughout all of your Wealthsimple accounts. |
*The interest rates listed above are not promotional rates.
**How net deposits are calculated: We calculate net deposits by adding up the total amount of money you deposit or transfer into all of your Wealthsimple accounts (including Managed investing, Stocks & ETFs, Crypto, Cash and Save accounts). Your net deposits will not decrease if the value of your portfolio decreases due to market fluctuations. However, your net deposit will decrease if you withdraw or transfer out funds from your accounts.
Receiving interest in your Cash account
Interest is calculated based on a daily closing balance, the value in the account at 11:59PM EST each day. It is then paid out monthly, with interest accumulated in each calendar month to be paid out within 7 business days of the 1st of the following month.
Your interest rates are subject to change at any time. Wealthsimple won’t change the 1% interest rate unless our bank partners change the rate we receive, which is usually impacted by updates to the benchmark rate set by the Bank of Canada.
Example
At the standard 1% annualized rate, you would earn around $10.00 in interest for the year (1%*$1000), or around $0.83 each month. Since interest is calculated daily and paid out monthly, you would receive around $0.82 at the end of April: (30/365)*10 = 0.82.
At the boosted 3% annualized rate, you would earn around $30.00 in interest for the year (3%*$1000), or around $2.50 each month. Since interest is calculated daily and paid out monthly, you would receive around $2.47 at the end of April: (30/365)*30 = 2.47.
At the maximum 4% annualized rate, you would earn around $40.00 in interest for the year (4%*$1000), or around $3.33 each month. Since interest is calculated daily and paid out monthly, you would receive around $3.29 at the end of April: (30/365)*40 = 3.29.
All interest accumulated from April 1st to 30th will be paid out within 7 business days of May 1st of the same year.
To opt-out of receiving interest in your Cash account, you can reach out to our support team for assistance.
Taxes on interest earned in your Cash account
Wealthsimple Cash accounts are non-registered accounts, meaning you will have to claim any interest earned during tax season.
We will send you a T-5 Statement of Investment Income before March 1st in order to help you report interest earned in your Cash account. Once your tax documents are ready, you can find them directly through your Wealthsimple account.
For more information on when your tax documents will be ready, you can reference this article.
A note from our legal team
Our Cash product is offered by Wealthsimple Investments Inc., a member of the Investment Industry Regulatory Organization of Canada, and Wealthsimple Payments Inc., a FINTRAC registered money services business. The funds you add to a Cash account are held securely in our omnibus custodial account with a federal trust company that is regulated by the Office of the Superintendent of Financial Institutions under the Trust and Loan Companies Act and is a member of the Canada Deposit Insurance Corporation (“CDIC”). CDIC protects eligible deposits held at CDIC member institutions in case of a member institution’s failure. Wealthsimple is not a CDIC member institution. Under the trust framework CDIC insures eligible cash balances up to $100,000 per beneficiary (Wealthsimple Cash customer) per member institution, provided certain disclosure rules are met. Coverage is free and automatic. Learn more about how CDIC protection works. Any interest that may be earned on funds are owned by Wealthsimple.
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