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It’s always very beneficial when you get a few pointers related to personal finance. The best place to get advice about personal finance is from someone who has personally experienced it, made the mistakes and learned from those mistakes. Dealing with guaranteed investment certificates can be very challenging, especially if you are a newbie still learning the necessary details about the GIC rates. Are you ready to have the best GIC rates?

Of course, in order to have the best investment portfolio, some factors need to be taken into consideration.  The main guideline for having a good portfolio is that you ought to have both fixed and equity income investments in your investment portfolio. The guaranteed investment certificates are one of the best ways of coming up with a good fixed income in your investment portfolio. So why should you invest in the GIC rates?

  1. There is full guarantee of your principal

When it comes to investments, many people wary of investments since most of these investment options do not offer a guarantee to the principal. With GIC you have the comfort of being assured that your principal will be returned to you. You will also get returns from your principal. When you invest in GIC rates you are more concerned about how much you will be earning instead of how much you will be losing your principal.

  1. You will definitely get returns/ interest

The guaranteed investment certificates are not a super or get rich scheme. However, this doesn’t mean you won’t benefit from them. The GIC investments you buy will definitely get you some returns. There are many tips that you can use to make the highest returns from your GIC investments.  More returns are gained from GIC rates that have longer terms. The other important thing is that you should not withdraw the investment before the term is over. In case you might need to make an early withdrawal of the GIC investments then you can opt for the cashable GIC investment plans (even though they don’t pay as high as the non-redeemable options).

  1. Guaranteed Investments Certificates offer unique protection

With GIC you are denied the opportunity to access your money in an immediate notice, which helps in building a savings culture. Unless faced with dire financial emergencies, you will not be able to get access to the funds in your GIC investment. However, some financial institutions and banks allow investors to get their guaranteed investment certificates earlier than the due date, however, this usually comes at a fee or cost.

  1. If you have a registered account, you can buy GIC investments

Do you own a TFSA or an RRSP, or your child owns an RESP? Then you should not be worried about being barred from investing in GIC. All these savings vehicles are eligible for the GIC investments. The RESP GICs and the RRSP GICs, do not attract any tax on the interest that the investors have earned from their investments. Even the TFSA GICs, don’t attract any taxes on the interest you have earned or the funds you will be withdrawing.

  1. Building Your Fixed Income Investment Portfolio using GICs

In order to have a well-balanced investment portfolio, it’s highly recommended that one should mix their fixed income products with equities. With equities investors, provide capital growth that is generated over a long duration. The fixed income products, on the other hand, offer protections for the principal while earning returns.  GICS is a type of fixed income investments, they offer more attractive returns, especially when the bonds (both corporate and government bonds) offer little returns. When looking at the best GIC rates make sure you look at all the determining factors.

 

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