4-Step Guide on How to Buy GIC

If you are in Canada, one of the best long-term and short-term investment opportunities you can consider is buying GIC rates. The guaranteed investment certificate can be bought in Credit Unions, Trust Companies, Caisses Populaires, Banks and other investment firms. However, many might be faced with the challenge of how to buy the GIC rates and the ability to know the best-guaranteed investment certificates they can buy.

However, if you are a newbie you don’t have to worry, the following easy 4 step guide will guide on how to buy GIC rates in the Canadian financial market.

  1. Deciding on how much money you are going to invest and the duration of the investment

Since most of the GIC investments will require one to have their funds locked for a specific duration of time, it’s good to consider all the different terms offered by the different GIC rates. Any withdrawal that is made before the term elapses often attracts a penalty fee. In case you anticipate that you might need to cash out your money earlier than in the stipulated term, then you can opt to get the cashable or redeemable GIC investment options. This can be cashed out at any time without attracting any penalty.

  1. Picking between a variable or a fixed interest rate

Investors have the option of picking a guaranteed investment certificate that has a fixed rate or a GIC with variable interest rates. It’s best to consult with your GIC broker on the best interest rate to pick that will suit your financial needs.

  1. Look at the available GIC investment options available

It’s very crucial that one compares the available GIC rates before settling on. Thanks to the internet, it’s easy for one to compare the guaranteed investment certificate rates online. You should do this after settling for a specific GIC term, consult with the broker whether you can get a better rate.

  1. Picking the correct GIC rate and financial institution

After settling on the best GIC rate for you. Your GIC broker or financial institution will require you to set up an account with them. Identification documents will be needed, and then you can deposit funds, which you will use in purchasing the best GIC rate for you.

The CANNEX website provides all interested and current investors with all the related information that relates to the best GIC rates in Canada. It’s good to use the compound interest calculator when comparing the different interests that will be accrued after you deposit your money. How much you will make at the end of the GIC term and how you will be receiving your interest payments are some of the crucial factors that potential investors should take into consideration when looking for the best GIC rates.

Insurance companies have a similar investment option known as guaranteed interest account or guaranteed interest annuity (GIA). They shouldn’t, however, be confused with the GIC rates.

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