Alterna Bank is a digital bank that offers a TFSA eSavings Account with a competitive interest rate of 1.15%, no monthly fees, and no minimum balance. Though it’s a lesser known online bank, your balance is still secured through the Canada Deposit Insurance Corporation (CDIC).
With any TFSA account, you can take advantage of tax-free earnings using a competitive interest rate. This is ideal for anyone looking for low risk, steady tax-free income from their money. Alterna is a great option because there are no fees and the mobile app is easy to use.
Alterna Bank TFSA eSavings Account features
Here’s what Alterna has to offer you.
Why You Want It
Get a 1.15% interest rate + Easily transfer your money between accounts.
Special Features
- High interest rate
- Easy funds transfer to and from your account to another financial institution
Eligibility
- Canadian resident
- Age of majority in your province or territory
- Have an account at another major Canadian financial institution
Provinces
ALL
Interest Rates
Any balance
1.15%
Features
# Of Free Transactions
0
# Of Free Interac E-Transfers
0
Max Promotion Rate
N/A
Welcome Bonus Value
N/A
Promo End Date
N/A
Alterna Bank TFSA eSavings Account product rating: 3.8 stars
The Alterna Bank TFSA eSavings account is a straight-forward option for anyone looking to earn tax-free income at a competitive interest rate. Using the Alterna mobile app allows you to do your banking at any time and easily transfer money from different accounts and banks into your TFSA by using me-to-me transfers. Plus, Alterna’s TFSA eSavings Account has no monthly fees and no minimum balance.
The downside with all Alterna accounts is they’re an online bank with limited physical locations, so if you need service from a teller, a big bank may be a better option. You should also consider the standard drawbacks of a TFSA account, like the fact that the amount you can contribute is limited by your annual contribution limit.
Rating methodology
To calculate our Genius Ratings, we compare the features of the account or product in question with other similar products in Canada. We give each feature a score out of 5 based on that comparison. Once we’ve rated all the features, we run them through our proprietary algorithm to produce a final rating out of 5.
Learn more about our rating methodology.
The pros of the Alterna Bank TFSA eSavings Account
The Alterna TFSA eSavings Account is great for savers looking for tax-free income with no minimum balance and no monthly fees, with the ease of use from banking on the Alterna app.
Pros
Competitive interest rate
An interest rate of 1.15% is fairly decent as far as high interest savings accounts go, and is especially nice since you’ll be reaping tax benefits on top of it.
No fee banking
Alterna’s TFSA account has no minimum balance and no monthly fees. Combined with a competitive interest rate, this account is a decent option for those looking for steady tax-free income.
Great accessibility
Alterna is a digital bank which means everything is done online. The app is easy to use and transfers can be future-dated – this is especially handy for anyone who wants to save a certain amount every month but don’t want to worry about forgetting to make the transfer.
The cons of the Alterna Bank TFSA eSavings Account
But there are a few downsides you may want to keep in mind as well.
Cons
Account balance is limited by your contribution limit
Similar to their RRSP, a TFSA account holder can only contribute up to a certain limit each year. If you have some contribution room from prior years, you may have additional room to contribute but will need to contact CRA to confirm. The maximum account balance is $250,000. It’s important not to exceed your TFSA contribution limit since the penalty for an overcontribution is 1% monthly on the excess amount.
No spousal contributions or joint accounts
The TFSA account cannot be set up as a joint account and spousal contributions are not allowed. This means your TFSA is yours-only and the contributions need to come from you.
Small online bank
Alterna is mostly an online bank, which means you won’t have the variety of services available that a larger bank can provide. If you prefer to have a full suite of banking products available to you, you may be better suited to a big bank.
Alterna Bank TFSA eSavings Account alternatives
Alterna’s TFSA account is preferable to similar products on the market – the mobile app makes it easy to use, me-to-me money transfers are very easy and can be future-dated, there are no fees and the interest rate is highest among competitors. It really doesn’t get much better for anyone looking for steady, predictable income in their TFSA while having easy access to their banking and keeping fees low.
 |  | |  | |
|---|---|---|---|---|
| Account | Alterna Bank TFSA eSavings Account | Scotiabank Money Master Savings Account | Scotiabank MomentumPLUS Savings Account | Canadian Western Bank Summit Savings Account |
| Genius Rating | ||||
| Why You Want It | Get a 1.15% interest rate + Easily transfer your money between accounts. |  $50 GeniusCash + Automatically save with every debit purchase through Bank The Rest. | Get up to 4.75%* interest on your money + No monthly fees. | Earn 8.5% interest + Free transfers and EXCHANGE Network ATM withdrawals. |
| Interest Rates |
|
|
|
|
| # Of Free Transactions | 0 | 0 | 0 | 0 |
| # Of Free Interac E-Transfers | 0 | 0 | 0 | 0 |
| Max Promotion Rate | N/A | N/A | 4.75% | N/A |
| Welcome Bonus Value | N/A | N/A | N/A | N/A |
| Promo End Date | N/A | N/A | See Issuer for Details | N/A |
| Open an account See more Alterna products Compare | I Want This Deal See more Scotiabank products Compare | Open an account See more Scotiabank products Compare | Learn More See more Canadian Western Bank products Compare |
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FAQ
Is the Alterna Bank TFSA eSavings Account worth it?
The Alterna Bank TFSA is a great option for anyone looking for stable income within their TFSA (with no fees) that can be easily accessed anywhere using the mobile app.
How do you withdraw money from an Alterna Bank TFSA eSavings Account?
You need to call Alterna directly to withdraw money from a TFSA, as they need to track the withdrawals to report to CRA. The withdrawals aren’t taxed but they’re tracked for the purposes of calculating your annual contribution room. The easiest way to make withdrawals is to set up a chequing or savings account with Alterna for the money to go to. Click here to learn more about their TFSA option.
What’s the current Alterna Bank TFSA eSavings Account interest rate?
The current rate is 1.15%, but this can change at any time. It’s best if you visit the Alterna Bank website directly for the most up-to-date information.
Editorial Disclaimer: The content here reflects the author's opinion alone, and is not endorsed or sponsored by a bank, credit card issuer, rewards program or other entity. For complete and updated product information please visit the product issuer's website.
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