The right savings account, government benefits, taking advantage of tax deductions, using government benefits, and cash back rewards are just some of the many ways Canadians can access free money.
All it takes is making some simple changes to your finances before the free money and savings start rolling in.
So, where does free money come from? *Hint* It’s not trees. Let’s find out.
Key Takeaways
- The right savings account and credit card can instantly increase your earnings.
- There are plenty of government benefits for Canadians, specifically for parents, seniors, people with disabilities, and students.
- Save on taxes by opening a registered account and taking advantage of deductions.
- Reduce everyday costs by cutting debt and lowering investment fees.
- Make use of employer-matched RRSPs and insurance plans.
- High interest savings account
- Cash back websites
- Get cash back on Canada’s best financial products
- Use your benefits
- Get a no fee bank account
- Avoid extra tax
- Government programs
- Student benefits
- Unclaimed CRA cheques
- Credit card welcome offers
- RESP
- Tax deductions
- Energy rebates
- Open an FHSA
- Reduce debt
- Investment fees
- Home Accessibility Tax Credit
- FAQ
1. Increase interest on your savings
You can achieve interest rates up to 3.5% by opening a high interest savings account with an online bank.
Big banks only offer interest rates between 0% - 2%. These lower interest rates will only help so much when building up your savings or an emergency fund. Online banks have less to offer in terms of amenities, like branch location, but they often make up for it with low fees and high interest rates.
Here are some of the top online bank high interest savings accounts you should consider:
- KOHO Earn Interest: Up to 3.5% interest and cash back on every purchase
- EQ Bank Personal Account: Up to 3% interest interest
- Simplii High Interest Savings Account: Promotional interest rate of 4.5% for the first five months
Tip: Link up a high interest savings account with your chequing account – this allows you to store and grow funds, and you can transfer money back and forth between it and your chequing account in a few business days as needed.
2. Get cash back when online shopping
Shopping through cash back sites can earn you extra money when purchasing items you need anyway – and this is on top of any cash back you get with your credit card. These cash back sites offer anywhere between 0.5% to 20% or more.
Depending on the website, your cash back will automatically be credited through PayPal, Direct Deposit, or with a cheque or gift card – usually within 60-90 days.
The following are some of the most popular cash back sites for Canadians:
- Great Canadian Rebates: With access to more than 900 retails, Great Canadian Rebates provides with a $3 sign-up bonus; referring a friend will earn you 25% of their rewards
- Rakuten: With access to more than 750 retailers, Rakuten offers a $5 sign-up bonus if you make $30 in purchases over the first few months; you’ll also get $30 cash back for each person you refer
- Swagbucks: Earn cash back by making purchases via Swagbucks' links, completing online surveys, downloading mobile apps and games, and more – new users get a $10 bonus when they spend $25 on an eligible item, while referring a new user gets you 10% bonus based on their Swagbucks earnings
- TopCashBack: Partnering with 250 Canadian retailers, TopCashBack provides members cash back offers ranging from 0.5% to 30% cash back; there are no fees and no minimum amount you need to spend in order to get cash back
3. Get cash back on Canada’s best financial products
GeniusCash is a cash back rewards app developed by moneyGenius that sends real cash straight to your bank account. GeniusCash offers three unique ways to earn free money:
- Access big GeniusCash offers worth up to $250: Earn cash back on top financial products and services, like bank accounts, credit cards, and loans, plus limited-time welcome bonuses and exclusive deals you won’t find anywhere else
- Get rewards-maximizing recommendations: Never question if you’re using the right credit card for things like groceries, gas, and travel again. GeniusCash will analyze your spending and tell you which one is best
- Level up your financial knowledge to spend and save with confidence and be rewarded: Learn the in’s and out’s of money in Canada and be rewarded with cash back levels. Basically, you’ll learn money to earn money!
4. Use ALL your insurance benefits
Using the health insurance coverage you have through work is part of your compensation package – don’t let it go to waste. Benefits often include health services not covered by government insurance, such as physiotherapy, dental care, prescription medications, and even cosmetic procedures.
Here are some examples:
- Vision coverage
- Dentistry
- Massage therapy
- Mental health counselling
- Wellness bonuses for items like workout gear or fitness classes
- Cosmetic procedures
There are plenty of other ways to take advantage of your insurance – read your policy and get creative with it.
Tip: Insist on paying for everything with your credit card and then submit your receipts and forms manually for reimbursement to earn additional rewards on these purchases. Credit card rewards = more free money!
5. Get a no fee bank account with a welcome bonus
Select bank accounts offer welcome bonuses. If you select a no-fee account without a minimum balance, that welcome bonus is 100% free money. If you’ve stuck with the same bank account with an annoying monthly fee, it might be time to reconsider.
For example: The Simplii No Fee Chequing Account offers no monthly fee, no minimum balance, unlimited transactions, and a $350 welcome bonus so long as you make three direct deposits.
6. Stop paying extra tax on your money
Placing some of your after-tax income into a registered retirement savings plan (RRSP) or a tax-free savings account (TFSA) allows you to grow that money without paying tax on it – at least not yet.
The Canadian government created these two types of tax sheltering accounts to ensure you don’t pay extra tax on your money:
- An RRSP allows you to build a retirement fund and defer paying tax on that money until you retire
- A TFSA allows you to build up savings and not pay any tax on money in this account or any income it generates (such as investment income)
You can withdraw money from these accounts any time. However, if you withdraw money from your RRSP, that amount will be tacked onto your income, so you’ll have to pay a withholding tax on it. Your bank will "withhold" this amount based on how much you withdraw. Depending on your income (which would include this RRSP withdrawal), you may need to pay more tax based on your tax bracket.
Tip: Instead of paying income tax on money earning interest in a savings account, put that money into a TFSA – contributions to a TFSA and any income earned from it are generally tax free.
$75 GeniusCash + Unlimited transactions for $0 + Ding-free non-affiliated ATM usage.
$25 GeniusCash + $50 bonus for funding a new account, and $0 commissions on stocks & ETFs
$12 GeniusCash + Access trusted news coverage 24/7 + Digital and home subscription options.
$25 GeniusCash + Delicious meal choices with fresh ingredients + Front-door delivery.7. Take advantage of government programs
The Canadian government provides plenty of opportunities for extra cash in the form of tax deductions, grants, and benefits for low-income earners, students, first-time home buyers, and others.
Grants and benefit programs are offered by both the federal and provincial government. You may be eligible for child benefits, low-income financial assistance, or even a payment for GST/HST.
Here are some of the most common programs that Canadians apply for:
- Guaranteed Income Supplement: The GIS is a guaranteed monthly, tax-free stipend paid to lower-income seniors who also receive Old Age Security (OAS)
- Canada Child Benefit: The CCB is a tax-free payment to parents to help raise children under the age of 18; the amount you receive from the federal Government depends on the number of children you have, their ages, and your income level
- Home Buyers Plan: If you’re buying a home for the first time, the HBP allows you to withdraw up to $60,000 from your RRSP – without being taxed – to purchase or build a home. You’ll have to pay that money back into your RRSP over a 15-year span
- Lifelong Learning Plan: The LLP allows you to withdraw up to $10,000 in a calendar year to help pay for full-time education for yourself or a spouse
Tip: Finding these programs is easier than ever – the Canadian government has created a Benefits Finder to help you determine which benefits apply to you.
8. Apply for tuition rebates and grants for students
Both the federal and provincial governments offer grants and tax benefits for students. Eligibility is typically determined when you apply for financial aid in your home province.
For example, you may get the Canada Student Grant (up to $4,200 per year for the 2024-2025 school year) if you meet income requirements, or get a grant if you’re a student living with a disability.
Tip: Look at your provincial student aid website for both financial support information as well as grants and funding availability.
9. Check for CRA unclaimed cheques
To check if you are entitled to any unclaimed cheques from the Canada Revenue Agency, go to your CRA My Account, click on "Uncashed Cheques" on the Overview page, or check the “Accounts and payments” page. The CRA will send you any money owed via direct deposit or mail a cheque to your address.
For more information on this, visit the CRA’s page on uncashed cheques from the CRA.
10. Welcome offers for low/no fee credit card applications
Credit cards often offer big welcome bonuses for new (approved) applicants. You might get straight-up cash, or it could be the points equivalent of a certain cash value. But either way, it's free money heading straight into your wallet.
If you prefer a no fee card, these are excellent choices with valuable welcome offers:
- Tangerine Money-Back Mastercard: $100 value
- American Express Green Card: $200 value
A low fee card will cost you a bit in annual fees, but the welcome bonuses on these cards can be worth it:
- TD Aeroplan Visa Platinum Credit Card: $400 value
- TD Platinum Travel Visa Card: $250 value
11. Use the RESP to get free money for your kids
Open and contribute to a Registered Education Savings Plan (RESP) for your kids and the federal government will contribute up to $500 per year via a Canada Education Savings Grant (CESG). The government will contribute a lifetime maximum up to $7,200. You may receive an additional $100 in grant money annually if you are a lower-income family.
You can withdraw any contributions you make to an RESP and give them to the student or yourself tax free at any time.
All government grant money and extra income earned from investing that money is not taxed until withdrawal. These funds are then taxed at the student’s marginal tax rate, which is often 0%, as students don’t usually make much money. Money withdrawn from the RESP must be given to the student after their enrollment in a qualifying educational program.
Tip: Remember, just like the RRSP and TFSA, you can hold any type of investment in the RESP, including cash.
If you want more information, see: Registered Education Savings Plan.
12. Take every tax deduction you can
A tax deduction is a legitimate expense you can subtract from your taxable income, and can be found on your T1 form roughly between lines 20600 and 23500. The Canadian Income Tax Act is filled with deductions – finding them can mean thousands of dollars in free money every year depending on your situation.
Here are some of the most common tax deductions:
- Any pension plan contributions you make through your employer
- Contributions you make to the Canada Pension Plan and Employment Insurance
- Any contribution made to your registered retirement savings plan (RRSP)
- Contributions made to professional associations or union dues
- Spousal support payments
- Moving expenses related to starting a small business or an education-related move
Tip: Use a reputable tax program such as UFile or Wealthsimple Tax to help you find the deductions you’re eligible for, or talk to an accountant.
Mentioning all the available deductions here would be impossible, but our Ultimate Guide to Saving Money on Taxes offers much more.
13. Get rebates on energy costs
Rebates on energy costs for installing new heating systems, low power consumption light bulbs and devices, and more efficient insulation can substantially reduce your monthly energy bills.
Both governments and utility companies offer rebates to help you increase your home’s energy efficiency and lower your energy costs.
For instance, a heat pump is three to five times more efficient than an electric baseboard. Yes, you can lower your heating costs by as much as 80%. In reality, your savings will be less – but still significant.
Tip: The Canada Carbon Rebate (available in select provinces) can mitigate some of the costs to make environmentally friendly upgrades more affordable.
To find out what rebates and grants are available in your province, check out this federal page: Financial incentives by province.
14. Open an FHSA
Opening a First Home Savings Account (FHSA) allows you to put away up to $8,000 in your first year, and $40,000 in total, tax free, towards the purchase of your first home. In order to be eligible for an FHSA, you must be at least 18 years old and be a first-time home buyer.
You can open an FHSA at any major financial institution, and contributions to this account are tax-deductible. You can carry over unused contributions to the next year, and withdrawals are tax free, so long as you withdraw that money within the account’s qualifying criteria.
Tip: If you don’t withdraw money from your FHSA after 15 years, or after you turn 71 years old, you can transfer these funds to an RRSP.
15. Stop overpaying on your debt
If you have debt, shop around for lower interest rates so you don’t overpay – for example, save cash by checking out our page on the best mortgage rates.
Big mortgages accrue a large amount of interest, but savings of 1% to 2% are possible off the posted big bank rates. For instance, on a 25-year, $300,000 mortgage, a difference of 2% will save you almost $100,000 in interest charges.
Credit card debt is another problem spot – no one should be paying 20%+ on their debt. Using a balance transfer credit card or a low interest credit card can lower your credit card debt down to a manageable level. Going from 20% down to 0% on $10,000 in credit card debt is like finding $2,000 of free money every year.
Tip: Take the time to compare mortgage rates – finding the best one can potentially save you thousands of dollars per year.
16. Stop overpaying for your investments
Opt for index investing – a kind of passive investing strategy where your fund manager assembles a stock portfolio that mirrors the profile of a chosen index with a fund management fee of about 0.2%. Otherwise, prepare to pay fund management fees like Management Expense Ratios (MERs) at a clip of 2.5% or more.
Indexing is a low-cost fund management fee strategy that will match and potentially even outperform the most highly trained portfolio managers. Otherwise, prepare to pay the experts managing your money a hefty (and likely unnecessary) fee.
17. Make your home safer with the Home Accessibility Tax Credit
For seniors and/or those living with a disability, the Home Accessibility Tax Credit (HATC) is worth $3,000 if a maximum of $20,000 is spent on safety and accessibility renovations.
To qualify for the HATC, you have to be at least 65 years of age or be eligible for the disability tax credit.
Tip: Eligible expenses include any permanent fixtures you’ll be adding to your home to improve its safety and accessibility, not to increase the property’s value.
FAQ
Can I get cash for free?
You can get free money in a variety of ways, like shopping with cash back sites, checking your CRA account for unclaimed cheques, and opening fee-free bank accounts. New credit card applicants can also earn cash welcome bonuses.
How do I get free money from the Canadian government?
Free money from the government comes in the form of benefits, grants, tax-sheltered bank accounts, and tax credits. There are multiple government benefits for children, people living with a disability, students, and rebates for energy costs.
Are government benefits tax-free?
Some are tax-free, while some aren't. The Canada Child Benefit, the Canada Carbon Rebate, or GST payments, are considered tax-free benefits. There are a few other benefit programs, though, such as Old Age Security, that are considered taxable income.
Is there free money for students in Canada?
Yes, there are several grants available for students to help pay for their education. You can read up on student loans and other student aid through your provincial student aid website and request to be assessed for available funding.
How can I get quick cash in Canada?
First, try chequing your CRA account for unclaimed cheques and/or shopping through cash back sites. One of the wisest choices, though, is to evaluate your debt load and budget in order to find areas where you're overspending.
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Comments
I should have said "country with socialist tendencies":
http://blog.peerform.com/top-ten-most-socialist-countries-in-the-world/
Even though I've known about this for as long as I can remember - I too enjoyed getting big refunds and never filled out this form to deduct more taxes at the source. I did find my deductions were not so uniform - so I guess that was another reason why I didn't do it.