I think this is a helpful method for those who have had trouble saving & I’d never recommend CSB as your own source of savings.
- “The Canada Savings Bond (CSB) is a safe and secure savings product, fully guaranteed by the Government of Canada to help Canadians reach their savings goals.
- CSBs have a three-year term to maturity, with interest rates announced for one year and remaining in effect for that period. At the end of one year, new rates are announced by the Minister of Finance based on the prevailing market conditions.”
Canada Savings Bonds are a tremendous idea to grow your savings. You may enroll once a year in October.
The payroll saving program allows the government to withdraw a set amount each pay and allocate it to the bond. You will earn interest the entire time too! Although, to be honest the interest really isn’t much to brag about. The bonds from last year are looking at about 0.70 return (less then some bank accounts). Each year they’ll post on their website the interest you’ll earn which may increase.
Once the bond matures, they’ll give you all your money back + the interest. I realize the return is incredibly low however the convenience is valuable to most. It’s also great because the deposits are directly off your pay, the money is gone before you ever see it. Painless! However the interest does compound it’s self.
Here’s a video on exactly how it works