Consider purchasing a GIC as a special kind of deposit you make to your bank. Why would you do this? Because these types of deposits, called Guaranteed Investment Certificates, offer some notable benefits on the usual savings-interest deposit arrangements.
For one, you don’t pay any fees, and GICs will pay out a fixed interest rate over a pre-set time, such as six months up to 1, 2, 5, or 10 years. These interest rates can vary for some GI C plans, which will be based on how a stock index exchange benchmark performs. Basically, the longer your GIC term, the higher interest rate you will get. However, there’s a catch – unlike conventional deposit funds, if you withdraw your GIC money before the end of the term, you will have to pay a penalty, unless you can get a specific type of GIC that allows this without penalty. These no-penalty GICs, called cashable GICs, will also offer lower interest rates. This is a decision – cashable or non-cashable – that you’ll need to make before signing up for a GIC, so make sure you know whether you’ll be needing access to the money in the future. GICs sound pretty good to a lot of people for some very good reasons. Check out these five good reasons to buy a GIC today.
A guaranteed return on your GIC investment Your basic GIC will bring you a guaranteed return on your investment. If you buy a non-market-inked GIC, and hold it for a long term without cashing it out, you’ll get a reliable return and a high interest rate.
Your principle investment is guaranteed Unlike other investment vehicles, with GICs there is zero risk that your principle investment will run into trouble and not be returned to you. For those who view investing in the stock market as something as a gamble, a GIC offers a safe refuge for your money – a refuse that will also grow your money. Though the return won’t be as high as a health stock market investment index, you’re guaranteed not to lose your money.
They’re compatible with registered accounts This means that your GIC can be bought for a registered account such as an RRSP or TFSA. These savings vehicles are good places to stick your GIC. But why? For RRSPs and RESPs, you won’t pay any tax on the interest earned while your GIC is held in these investment vehicles. Same goes for TFCSA – when you do finish your GIC term, gaining the interest, you won’t be facing the taxman to pay capital gains on your investment growth.
Putting money where you can’t easily spend it Sometimes it’s best if we have our investments kept at arms-length. This prevents us from using these funds like a regular day-to-day savings account. In case of emergency, you may still be able to withdraw your GIC, but there will be a penalty.
GICs complement a fixed-income portfolio GICs are a great investment to add balance to a fixed income financial portfolio. Along with a mix of equities, fixed-income financial products like GIC let you safely grow your income at rates higher than bonds. Whether you’re saving for a short-term goal like a summer vacation in Europe or a long-term goal like a down payment for a new mortgage, GICs are an excellent choice
Author Bio: I am Eric Jones, a businessman by profession. Business and entrepreneurship are my passion and I love researching on the various aspects of those areas. I make sure that I don’t miss out any updates and for this reason I read quite a lot. Law is yet another area which I am passionate to know more about.
4 Reasons to Replace Your Car’s Engine With Performance Parts
Performance parts are the best kind of upgrades you can make to a car. Performance cars have a higher price...
Maximum Power: Update Your Old House For Modern Electrical Needs
An outdated electrical system can wreak havoc on your energy bills and greatly increase your risk of structural damage. If...
Key Techniques To Learn On A First Aid Course
Introduction First aid training is an incredible qualification that can enable one to offer life saving assistance in an emergency....
Best Tips For Managing Your Building and Construction Projects
Building and construction projects consist of many tasks, from job-site duties to office paperwork. Juggling it all can oftentimes be...
How To Choose The Best Locksmith For The Job
The existence of a locksmith is very crucial for society because they help out countless people on a daily basis....
5 Modern Conservatory Ideas To Create A Serene Escape
Having a serene and relaxing conservatory is the dream, especially in the summer months. Creating an extension of your home...
4 Different Types Of Lifting Equipment For A Construction Site
One of the biggest challenges on a construction site is the problem of lifting heavy materials and tools to a...
5 Tips That Can Help Your Business Flourish
Many, both small and big, businesses were affected by the outbreak of the novel coronavirus, no one was spared. Overnight,...
Why First Aid Training Is Essential For Your Business
Introduction All employers, depending on the establishment, should organize and provide basic appropriate conditions for lunch breaks as well as...
Are You Covered? Tips For Finding Affordable Health Insurance For Your Whole Family
If you are in the market for health insurance, you may be overwhelmed by the many different features and the...
How to Prevent Potential Hazards In A Lab
Unfortunately, lab accidents can happen. When they do, the consequences can be very serious. Some of the most common lab...
How to Extend Your UK Spouse Visa
The UK spouse visa is also known as a UK marriage visa. The UK spouse visa allows married partners of...
How Best Is Automation Helping The Retail Industry to Survive?
“In the post Covid-19 world, the only place cos are willing to invest is in automation. The return on investment...
Best Artificial Intelligence Trends to Watch Out In 2021
Technologies are getting advanced day by day, and according to that, the developers and the mobile app development companies should...
Keeping Your Assets Safe — Crypto Insurance May Soon Become The Norm
Many people all over the world have compared the cryptocurrency market to the wild West, largely because of the fact...
Tech6 years ago
Creating An e-Commerce Website
Tech6 years ago
Design Template Guidelines For Mobile Apps
Business6 years ago
The Key Types Of Brochure Printing Services
Travel9 years ago
Who Else Wants Also Nfl Hat
General6 years ago
Kobe Bryant With His Unique Nba Jerseys
Tech7 years ago
Why Small Businesses Can't Ignore Mobile Technology
Tech6 years ago
Climb Google Using These Checklists
Health7 years ago
Health Supplements For Sports Activities Nutrition