A high-interest savings account is a type of savings account that offers a higher interest rate than regular savings accounts, allowing your money to grow faster over time. These accounts are designed for individuals looking to earn more on their savings while still having easy access to their funds.

Interest on high-interest savings accounts is usually calculated daily and paid out monthly. The interest rate can vary depending on the financial institution and economic conditions. In both Canada and India, the interest earned on these accounts is typically compounded, meaning you earn interest on both the principal amount and the previously earned interest.

Fees for high-interest savings accounts vary by bank and account type. In Canada, most high-interest savings accounts come with no monthly fees but may have charges for certain transactions, such as withdrawals or transfers. In India, some banks may impose maintenance fees or transaction charges if certain conditions, like maintaining a minimum balance, are not met. It’s important to review the fee structure before opening an account.

Yes, the interest earned on a high-interest savings account is taxable in both Canada and India. In Canada, the interest must be reported as income on your tax return, and it is subject to your marginal tax rate. In India, the interest earned is also taxable and must be declared under the “Income from Other Sources” category in your income tax return.

To choose the best high-interest savings account, consider factors such as the interest rate offered, any associated fees, the ease of access to your funds, and the bank’s reputation. In Canada, look for accounts with competitive rates and no monthly fees. In India, consider the account’s interest rate, the minimum balance requirement, and any additional benefits like online banking or ATM access. Comparing different accounts can help you find one that best meets your financial goals.