Q&A: What to do with CSBs

Question: I have some Canada Saving Bonds that mature on Nov. 1 2007. These are
regular interest bonds. Is it worthwhile to hold on to these bonds that only gave
1.5 per cent interest in 2005 or is it better to cash them in for something better?
– M.S.

Gordon Pape answers: These bonds no longer carry a rate guarantee,
which means they will receive the current CSB rate until they mature. The latest
series carries a rate of 2.75 per cent, which is much higher than you received
in 2004-05. If you are content with that, you should continue to hold. However,
some small financial institutions are offering savings accounts with rates as
high as 3.85 per cent. Larger companies, like ING Direct, are paying 3.15 per

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