Money on the Ground

I live in a rental, and for years, my monthly rent (now $1246/month - which is incredibly cheap in my HCOL city) has been paid via pre-authorized debit from my regular checking account. I always ensured that my checking account never went below $1246, so that whenever the first of the month would roll around, rent could be auto-paid without any problems. However, I recently realized this meant that every month, I was missing out on $1246 worth of interest from my High Interest Savings Account (HISA).


I thought maybe if I transferred the $1246 from my checking account (where my paychecks go) to my HISA as close as possible to the beginning of the month (when I get paid), I could let it accrue as many days of interest as possible in the HISA, then transfer it back to my checking account before the rent is due, for max interest benefit.

Unfortunately, my checking account and HISA account are in two separate banks, so the transfer to the HISA could take 3 days, and the transfer back could also take 3 days. Even if I went out of my way to set reminders to initiate the transfers for both directions twice every month, this would be quite a bit of hassle.

But then I discovered, bills (such as rent) can indeed be paid from a HISA!

So I did the math...

Rent = $1246/month
Checking account interest = 0%
HISA yearly interest rate = 2.45%
HISA daily interest: 2.45% / 365 days = 0.006%
0.006% x 15 days = 0.1%
0.1% of $1246 = $1.24 per month
$1.24 x 12 months = $14.88 per year


This meant keeping each month's rent in my HISA for at least 15 days gives me a free $1.24 per month in interest (a free $14.88 per year).

And if I kept the $1246 in the HISA account for 30 days (instead of 15), that would give me a free $2.48 per month in interest (a free $29.76 per year).


A number of steps were required to put this into action. I had to:

• Go to the rental office
• Get some paperwork (previous pre-authorized debit cancellation form, and new pre-authorized debit payment method form)
• Complete the paperwork
• Get a void cheque for the new pre-authorized debit account
• Go back to the office to deliver the paperwork

I just completed this process today, so starting next month, and forever thereafter, I'll start getting free money.

You may be reading this and think that this sounds like a lot of thought and effort for just a little over $2 a month. Could it really be worth it?

To be honest, the old me probably wouldn't have bothered.

But the new me thinks of it this way:

Everyone has found money on the ground in their lives. And I'm sure we've all picked up mere pennies, even off dirty floors.

Unless you happen to be extremely wealthy and reading this, if today, you saw $2 on the ground, within your reach, I'm willing to bet you'd pick it up.

But this little monthly interest hack I've thought of can't be compared to a one time $2 find.

More accurately, it can be compared to having to hop a small fence to get the $2 you see on the ground on the other side, but then, after you collect the $2, every month thereafter, you automatically get a bonus $2 in your bank account for no reason.

So is this little interest hack worth it? I think so.

Now that you can "see" where the free money lies, hop the theoretical fence. Put in a bit of work, and get a bit of money every month forever.

Any earnings that can received on autopilot with zero risk is definitely worth it.

Photo by Sara Kurfeß on Unsplash