GICs

What are guaranteed investment certificates?

A guaranteed investment certificate is a Canadian investment that offers a guaranteed rate of return over a fixed period of time, most commonly issued by banks & insurance companies. Due to its low risk profile, the return is generally less than other investments such as stocks, bonds, or mutual funds.

How does GICs work?

The GIC works much like a certificate of deposit in the U.S. In the case of GICs, you deposit money in the bank and earn interest on that money. The catch is, the money must be deposited for a fixed length of time, and interest rates vary according to how long that commitment is. When you buy a GIC, you are basically lending the bank money and getting paid interest in return.
GICs are considered safe investments because the financial institutions that sell them are legally obligated to return investor’s principal and interest

What are the benefits of investing in GICs?

GICs come with a whole lot of benefits, like:

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