Tangerine GIC rates

GICs are a secure way to save money and take advantage of a great interest rate. Enjoy the comfort of knowing your investment is guaranteed for the term you choose.

Why Tangerine GICs:

• Great Rate: Lock in your savings for one of our set terms and start earning a great rate.
• No unfair fees or service charges: We simply don’t believe in unfair fees. So you won’t have to pay to save with us.
• Easy to open online: Once you’re a Tangerine Client, opening a GIC online takes just a few minutes.

A Beginner's Guide to GICs

If you don't know much about GICs, or are curious about how GICs work, here's a guide to help you understand them.

• A GIC is a secure investment that guarantees the principal you invest and your interest. The term can range from 30 days to five years, and your money will be locked away during that time.
• GICs can range from shorter terms like 30, 60 or 90 days to a longer term like a year, or multiple years. Generally, the longer the term, the higher the interest rate.
• The money you put into a GIC, plus the interest, is covered by the Canada Deposit Insurance Corporation (CDIC), up to $100,000 per account.
• Will you be taxed on your GIC earnings? Yes, unless your GIC is housed in a registered investment, such as a TFSA or an RSP. Just make sure to stay within your limits.
• What’s the catch? There's no catch, just a word of caution. Remember that with most GICs, your money can't be redeemed, meaning it's locked away for the entire term that you agreed to. So, if you're eyeing a three year GIC, for instance, but you think you might need that money sooner, consider a shorter term, or a product where the funds are more accessible, such as a savings account.

Should I invest in GICs? It depends on what your goals are. Here are some questions to consider:

1. When do I need to have access to the money?
2. What do I need the money for?
3. What's my risk appetite?

• Don't start here: "Shall I invest in a GIC, or should I invest in a mutual fund or the stock market?"
• Start with these questions instead: What are my goals? What is my risk tolerance? And what is the timeframe I'm working with?
• So, three things: goals, risk tolerance and timeframe

What are the benefits of creating a GIC ladder?

• Rather than locking in all your savings for five or more years, a ladder gives the flexibility of accessing at least some money once per year if needed.
• It reduces having to guess where interest rates are going.
• It can be a low-cost substitute for a conservative investment portfolio.

A “GIC ladder" is a strategy for dividing a lump sum of money between a series of Guaranteed Investment Certificates with staggered maturity dates.

Typically, you'd initially place 1/5th of the lump sum into five GICs of the following terms: 1 year, 2 year, 3 year, 4 year, and 5 year. Each of these is like a “rung" on the ladder.

Every year you'd have one GIC maturing, and you'd immediately take the proceeds and purchase a new 5-year GIC to keep this GIC ladder going for as long as you want.

What are the benefits of creating a GIC ladder?

1. Periodic access to at least part of your money

One reason why someone may prefer a ladder approach is they may not want to tie up their entire GIC savings for 5 years. They may want the flexibility of accessing at least some money once per year, in case they need it. And if they don't, they can roll it (or some of it) back into the ladder by buying a new 5-year GIC.

2. Less worrying about the direction of interest rates

Another reason the GIC ladder is popular is that it reduces having to guess where interest rates are going and the frustration of trying to pick the single best term.

3. Easier to sleep at night

GIC ladders are often used as a low-cost substitute for the conservative investment allocation of a portfolio. Fixed income investment funds (like bond mutual funds) may still exhibit day-to-day price movements that can bother the most conservative investors when they open their statements. A GIC's value will be as steady as it gets.