About GICs

GICs play an important role in a balanced portfolio because of the security they offer. GICs provide a secure way to save for short-term goals, like a vacation, or for longer-term plans, like buying a house or retirement. Either way, a GIC is a sound investment option.

When you buy a GIC, you invest a sum of money for a specific term, or period of time. At the end of that term, you are guaranteed to receive your full principal - your initial investment - plus interest income on your money.

Laddering Your GIC Saving

Ever climbed up a ladder? Now you can watch your money do the same. This proven savings method for GICs ensures you get the most return for your investment. The idea is to use different interest rate environments to your financial advantage.

Here's how it works. Instead of investing $5,000 into a five-year term, break it up so that $1,000 is in a one-year term, another $1,000 is placed in a two-year, $1,000 in a three-year, and so on. When the first term matures at the end of one year, then renew it into a five-year term. When the second term matures, renew it for five years, and so on.

Stay patient.

Now what eventually happens is you will have a five-year GIC maturing every year. By laddering your GICs, you are always hedging to make the most interest available - regardless of the rate environment.