Are you also tired of low-interest payouts of traditional banks on savings accounts? I’m in the same boat.
Our traditional banking system has been dominated by the Big Five Banks of Canada such as RBC and TD. They offer a personal banking experience with their large brick and mortar footprint.
They are also covered by the CDIC, which means you won’t lose your deposits even if a situation like the Great Recession hits up to a certain amount.
However, their low-interest rates on saving accounts are one thing that has always bothered me. Even the supposedly high-interest savings accounts offer only a 1% rate and charge you for every transaction.
These low-interest offers by big banks could become a thing of the past if you open an account with Oaken Financial.
Oaken Financial is an online bank that offers you high-interest saving accounts and also lets you invest in Guaranteed Investment Certificates (GIC).
For people who want to stash their money into a virtually zero-risk environment while also getting some interest that is worthwhile on it, Oaken Financial can be a better alternative than going to one of the big five Canadian banks.
Earn higher interest than the Big Five banks
Use: Online Bank
Wealthawesome Score: 4.6/5
- Higher upfront interest rates with no strings attached
- No recurrent charges whether you open a savings account or get a GIC plan
- Flexible maturity terms— from 30 days to 5 years
- No minimum balance requirements for a savings account
- Online-only operations— not for those who are accustomed to traditional banking setup
- Doesn’t have a dedicated mobile app like other online-only financial services
- Investment options are limited to GICs
- Various safe investment options: High-interest savings account, registered and non-registered Guaranteed Investment Certificates
- Deep-rooted financial history: From the years of the good reputation of Home Bank and Home Trust Company
- Two deposit issuers: Both Home Trust Company and Home Bank issues deposits on Oaken’s behalf that are protected with CDIC’s coverage
- Easy to approach: Online, phone, in person, mail, you can do business with Oaken the way you want
Free High-Interest Savings Account
Oaken Financial Review: What is Oaken Financial?
Oaken Financial is the subsidiary of Home Bank that is helmed by Home Trust Company— Canada’s largest independent trust company. It was launched in 2013 and since then has become one of the top online banks of the country.
An online-only bank, Oaken offers high-interest rates on GICs in RRSP, RRIF, and TFSA as well as letting you open a no-frills savings account. Like other online banking outlets, Oaken Financial is able to offer good interest rates on savings accounts because it doesn’t have to deal with the mounting overheads that the traditional banking system has to put up with.
Oaken Financial Services
Oaken Financial primarily offers two services: Guaranteed Investment Certificates and Savings Accounts. Let’s break down these services.
Oaken Financial Savings Account
(Rates as of March 3, 2020)
The best thing about Oaken Financial Savings Account is it that doesn’t involve fine print terms and conditions as far as interest rates are concerned. You get a 2.30% upfront annual rate on the amount you deposit in the Oaken Financial Savings Account— no more, no less.
The other good thing is that you are not spoiled for choices. There is only one type of savings account that you can open with Oaken Financial. I have opened a savings account in Oakland Financial for three reasons and think that they will also resonate with you.
- High-Interest Rates: It goes without saying that high-interest rates are the first thing that pushed me to find out more about Oakland Financial. Getting a 2.30% rate with no strings attached— it is definitely one hell of an offer.
- Unlimited Feeless Transactions: This feature has allowed me to use it as a checking account.
- No Minimum Balance: I am not under any pressure to maintain a minimum balance to keep the account running. This peace of mind goes a long way.
Also, there are no monthly, annual, registration and “out of the blue” service charges. However, there are some chargeable items that I will mention in the fee section.
Oaken Financial GICs
Oaken offers both registered (TFSA, RRSP, RRIF) and non-registered GICs.
Oaken Financial Non-Registered GICs
Non-registered GICs are not bound with contribution limits. You can contribute to a non-registered GIC as much as you like. However, the principal and compound deposited in non-registered GICs is tax liable. Non-registered GICs further branches into personal and commercial GICs.
As the title implies, these GICs are available for individuals who want to stash their savings into a safe investment. Some of the highlights of Oaken Financial GIC are:
- Available in both cashable and non-cashable forms
- Available in various short-term (monthly) and long-term (yearly) terms— from 30 days to up to 5 years
- Several interest payout cut-offs— monthly, semi-annually, annually, at maturity
It also offers the same benefits and rates as personal GICs. However, Oaken Financial offers this GIC only to trusts, registered estates and organizations instead of individuals.
Oakland Financial Interest Rates on Non-Registered GICs
Interest rates on long-term, short-term and cashable GICs are the same across the non-registered plans. The below snapshot gives an overview of the interest rates offered on non-registered GICs. (As of March 3, 2020)
Long-term GIC interest rates
As you can see; the longer the term, the higher the return. Also, Oakland increases the rate if you opt for a longer payout cut-off.
Short-term GIC interest rates
Cashable GIC Interest Rates
Cashable GIC requires you to deposit $1,000 at least.
Oakland Financial Registered GICs
Oakland also lets you hold GICs inside your registered savings accounts such as RRSP and TFSA. It is a good option to choose if you want to grow your investments while enjoying tax leniency.
Registered GICs Interest Rates
Oakland Financial doesn’t offer multiple interest payout options on registered GICs. You only get your annually compounded interest returns at the maturity of the chosen term.
You can choose between Home Trust Company and Home Bank as your deposit issuer. I don’t think there is any difference between either of them, because both are separate members of the CDIC and offer coverage on your deposits up to applicable limits.
Oaken Login and Opening an Account
Signing up with Oaken Financial and opening accounts is easy. Go to this link, and you will be greeted by the below window.
You can see that Oaken offers different modes of opening accounts, with your convenience in mind. You can go digital and open the account without going anywhere by clicking on the green button. You can go old school and make an appointment to open it in person as well. You can also start the process via email or phone.
Oaken Financial FAQ
Is Oaken Financial a member of CDIC?
Yes, Home Bank and Home Trust Company, the primary deposit issuers of Oaken are CDIC members. The CDIC offers deposit insurance at up to $100,000 per name registration for every deposit including principal and interest amounts.
Does Oaken Financial follow Home Bank fee plans?
No, Home Bank fees and revised charges have no bearing on Oaken’s fee plans.
Are interest rates at Oaken Financial the same across the board?
Yes, you will get the same interest rate no matter which deposit issuer you choose.
What happens when GICs matures at Oaken Financial?
Oaken Financial gives you the option of auto-renewal on your investments. If you choose that option, your investment will move into the new term upon maturity.
How does Oaken Financial Interest Rates Compare to Competitors?
Oaken Financial is offering one of the highest interest rates among the online-only Canadian banks. Only EQ bank, Tangerine and Wealthsimple Cash are offering higher rates than Oaken Financial.
Oaken Financial and EQ Bank
EQ Bank has a slight edge over Oaken Financial because it is offering a 2.45% interest rate with all the perks (no transaction fees, no minimum balance requirement, etc) that Oaken savings accounts offer.
Oaken Financial and Motusbank
Oaken Financial fares well than Motusbank with its interest rates. Currently, Motusbank is offering a 2.10% interest rate with its savings accounts in comparison to 2.30% of Oaken Financial.
Oaken Financial Fees
Oaken Financial charges nominal fees for hardcopy statements. Moreover, you have to pay a deposit fee for any dishonored check. Also, if an account has been dormant for 2 years or more, you need to pay an annual fee to keep it active. The overview of chargeable and no-fee items is given below.
Oaken hasn’t revised these charges since May 2018.
Is Oaken Financial Safe and Legit?
Oaken Financial has standardized 128-bit encryption for the exchange of all the confidential financial information. It is the most secure encryption module and available on most of the browsers. Oaken Financial only allows non-financial information transactions on browsers featuring 40-bit encryption.
How to Close Oaken Financial Account
There is no automatic, online way to close yourOaken Financial Account. You will need to get in touch with its customer support and ask them to initiate the process.
Oaken Financial Contact and Customer Service
You can reach out to Oaken Financial customer service through phone and email.
Phone: 1-855-OAKEN-22 (625-3622)
You can also set in-person appointments with customer representatives in their offices at the following four locations.
200 Granville St.
Vancouver, BC V6C 1S4
517 – 10th Avenue SW,
Calgary, AB T2R 0A8
145 King Street West
Toronto, ON M5H 1J8
1949 Upper Water Street
Halifax, NS B3J 3N3
Hours: Monday to Friday, 9:00am to 5:00pm
Is Oaken Financial Right For You?
Get Oaken Financial if:
- You want a high-interest savings account that will pay you more than the big banks
- You don’t need to go into a branch to talk to an advisor for your banking needs
Oaken Financial – Who This App is NOT for
Don’t get Oaken Financial if:
- It’s very important for you to have a financial advisor to talk about your account
- You’re looking for a comprehensive online bank that will handle things like investments and mortgages.
If you’re just looking for somewhere to park cash that will earn you enough interest to keep pace or beat inflation, Oaken Financial is a great option.
Let me know if you give it a try, and what your thoughts are on the product in the comments below!