YOUR MONEY

Lament for Canada Savings Bonds

Rumour has it that the federal government is considering ending the 70 year run of Canada Savings Bonds as sales have plummeted in recent years.

At one point my parents and I were avid and regular Canada Savings Bond buyers.  

CSB interest rates were very good and bonds backed by the federal government  was a 'safe' choice. 

But well over a decade ago  provincial governments entered the field with somewhat higher rates, and similar bonds issued by banks as GICs -- insured up to $100,000.00 per account - with even higher yields, simply blew away Canada Savings Bonds. 

Put simply, CSBs are no longer competitive and anyone can easily do better. The rates for 2016 now posted are: Premium Bonds for 3 years at 1.0%!!;  and traditional bonds at 0.5%!!

So the end of the CSB program will be missed on nostalgic grounds; killed off by the federal government with its cheapskate approach.