Are you looking for a secure, low-risk and growth-oriented investment vehicle? A Guaranteed Investment Certificate (GIC) could be just what you need.
As an investor, the security of your money and the highest possible returns you can make are two of the most essential things to look for. All these are accessible with GICs.
GICs are one of the safest investments in Canada with competitive returns. Besides offering guaranteed interest rates, assets on GIC accounts are also insured up to a given limit.
So even when your bank or financial institution runs out of business, you’re sure to get your money back.
Whether you are saving for retirement, a house down payment or just trying to build your investment portfolio, GICs could be the perfect vehicle to invest in.
But as different GIC providers offer varying rates, you want to associate with an institution that provides the highest rates.
In this article, we will explore some of the best GIC rates in Canada to help you know where to invest your funds safely.
Table of Contents
Overview of GICs
Guaranteed Investment Certificates (GICs) are fixed-income investment vehicles that allow you to save your funds with a financial institution for a particular period.
Think of it this way, financial institutions need money to expand their businesses. They provide GICs as a way to raise these funds and in turn, share profits with those that invest with them.
The GIC returns are shared based on an agreed interest and term stipulated at beginning of the contract.
When the timeline is completed, you will receive your accrued interest and your capital back.
GICs have terms ranging from 30 days to 10 years. However, most institutions offer 1 to 5 years terms. You can choose either short-term or long-term GIC investments.
Short-term GICs investments are usually less than a year while long-term GICs investments range from 1 to 10 years. Bear in mind that the longer the years, the more the returns. Although there are exceptions.
Because GICs are insured by various insurance companies, they are considered among the safest investment vehicles in Canada.
That being said, GICs can be invested through registered or non-registered accounts. While some institutions offer different interests on registered vs non-registered accounts, others offer the same rate
If you invest in GICs with a registered account like RRSP, TFSA, or RESP, your interest is tax-protected.
However, if your GICs are in a non-registered account like HISA, your interest is considered taxable income and will be taxed accordingly.
Note that for an RRSP account, you’re taxed at the point of withdrawal according to your marginal tax rate.
In the following passages, we shall be looking at the best non-registered and non-redeemable GIC rates in Canada on 1-year, 3-year and 5-year terms.
Best GIC Rates in Canada: 1-Year Term Comparison
| Position | GIC Provider | 1-Year GIC Rate | Minimum Investment Required | Deposit Insurance Provider |
| 1 | Oaken Financial | 5.25% | $1,000 | CDIC |
| 2 | Saven Financial | 5.20% | $1,000 | FSRA |
| 3 | People Trust | 5.10% | $1,000 | CDIC |
| 4 | Equitable Bank | 5.06% | $1,000 | CDIC |
| 5 | Home Bank | 5.05% | $1,000 | CDIC |
| 6 | League Savings and Mortgage | 5.05% | $500 | CDIC |
| 7 | WealthOne | 5.00% | $1,000 | CDIC |
| 8 | B2B Bank | 4.94% | $1,000 | CDIC |
| 9 | Tangerine | 4.85% | N/A | CDIC |
| 10 | Community Trust | 4.57% | $1,000 | CDIC |
On a year term, Oaken Financial has the highest 1-year GIC rate at 5.25%. The Oaken interest rate and all the interests that would be discussed shortly are annualized.
Saven Financial comes second on the list having 5.20% and People’s Trust comes third having 5.10% interest rates respectively.
The lowest rate for a 1-year GIC term is offered by Community Trust at 4.57%. If you want to lock up your funds for just a year, Community Trust should be your last option in this compilation.
Bear in mind that all these financial institutions (except Saven Financial) are insured by the Canadian Deposit Insurance Corporation (CDIC).
In the case of Saven Financial, it is insured by the Financial Services Regulatory Authority of Ontario (FSRAO).
Also, each of the banks has varying minimum investment amounts for their GCIs as shown in the above table
The lowest minimum investment requirement is $500 from League Savings and Mortgage. Tangerine is the only bank that doesn’t require a minimum balance on this compilation.
Best GIC Rates in Canada: 3-Year Term Comparison
| Position | GIC Provider | 3-Year GIC Rate | Minimum Investment Required | Deposit Insurance Provider |
| 1 | Saven Financial | 5.20% | $1,000 | FSRA |
| 2 | Oaken Financial | 5.10% | $1,000 | CDIC |
| 3 | WealthOne | 5.10% | $1,000 | CDIC |
| 4 | People Trust | 5.00% | $1,000 | CDIC |
| 5 | Tangerine | 4.90% | N/A | CDIC |
| 6 | League Savings and Mortgage | 4.75% | $500 | CDIC |
| 7 | Home Bank | 4.70% | $1,000 | CDIC |
| 8 | Equitable Bank | 4.65% | $1,000 | CDIC |
| 9 | B2B Bank | 4.60% | $1,000 | CDIC |
| 10 | Community Trust | 4.30% | $1,000 | CDIC |
On a 3-year GIC term, Saven Financial offers the highest rate at 5.20%.
The next in line is Oaken Financial with a 10% interest rate. This is followed by WealthOne (5.10%), People’s Trust (5.00%), Tangerine (4.90%), and Home Bank (4.70%).
Below the ladder is Community Trust with 4.30% interest on a 3-year GIC term.
Best GIC Rates in Canada: 5-Year Term Comparison
| Position | GIC Provider | 5-Year GIC Rate | Minimum Investment Required | Deposit Insurance Provider |
| 1 | Saven Financial | 5.30% | $1,000 | FRSA |
| 2 | WealthOne | 5.15% | $1,000 | CDIC |
| 3 | Oaken Financial | 5.00% | $1,000 | CDIC |
| 4 | People Trust | 5.00% | $1,000 | CDIC |
| 5 | Tangerine | 4.50% | N/A | CDIC |
| 6 | League Savings and Mortgage | 4.45% | $500 | CDIC |
| 7 | Home Bank | 4.45% | $1,000 | CDIC |
| 8 | Equitable Bank | 4.40% | $1,000 | CDIC |
| 9 | B2B Bank | 4.30% | $1,000 | CDIC |
| 10 | Community Trust | 4.15% | $1,000 | CDIC |
As mentioned earlier, most GICs have 1-year to 5-year investment terms and the longer the years, the higher the returns. You should expect the highest returns here.
Again, Saven Financial has the highest 5-year GIC rate in Canada at 5.30%. Coming behind are WealthOne with 5.15%, Oaken Financial and Tangerine with 5.00% interest rates respectively.
In general, a 5-year term GIC is recommended if you’re sure you will not need your funds within a short time or for emergency funding.
If you’re looking for a redeemable or cashable GIC that provides access to funds before maturity, you have to extend your research as all the above rates are non-redeemable
Best GIC Providers in Canada
In this section, we shall be looking at some of the best GIC providers in Canada that stand out from the competition.
Frankly speaking, you can’t go wrong with all the above GIC providers in Canada so long as you choose a bank that meets your needs.
To make a cost-effective decision, it’s essential to look beyond the GIC rates and understand other aspects of your favourite institution.
That said, let’s take a brief look at the outstanding GIC providers in Canada.
Saven Financial
From the above compilation, Saven Financial appeared to be the overall best GIC provider in Canada by offering competitive rates on 1-year to 5-year terms.
Saven is a digital bank available only to residents of Ontario. It is owned by FirstOntario Credit Union and was launched in 2021.
Apart from its high GIC rates, Saven Financial is also known to offer one of the highest HISA rates in Canada. The current rate is 3.75%.
The key features of Saven Financial GICs are highlighted below:
- Up to $250,000 insurance by FSRA
- $1,000 minimum investment requirement
- Interest is paid on maturity.
- 1 to 5-year terms.
Oaken Financial
Launched in 2013, Oaken Financial is a subsidiary of Home Trust Company. It is a digital bank with physical offices in Toronto, Vancouver, Calgary and Halifax.
Oaken Financial offers GICs and savings accounts with competitive rates that are available to all residents of Canada.
The following are the key features of Oaken Financial GICs
- Up to $100,000 protection by CDIC
- $1,000 minimum investment requirement
- Interest rates are paid on maturity
- Available in registered and non-registered accounts
- 1-year to 5-year terms available
EQ Bank
EQ Bank, the only banking arm of Equitable Bank, is among the top-ranking providers of the best GICs in Canada.
In addition to non-redeemable GICs, EQ Bank also offers high-interest savings account with 2.5% interest.
The bank also offers access to USD savings accounts, international money transfers and a mortgage marketplace.
The following are the competitive GIC rates of EQ Bank that compete significantly with those of its parent company (Equitable Bank).
| Term | Rate |
| 1-year | 5.00% |
| 2-year | 5.00% |
| 3-year | 4.85% |
| 4-year | 4.65% |
| 5-year | 4.50% |
| 6-year | 4.30% |
| 7-year | 4.30% |
| 10-year | 4.30% |
Below are the key features of EQ Bank GICs
- No monthly fees
- $100 minimum investment (one of the lowest in Canada)
- Available on registered and non-registered accounts
- Automated updates
- 3-month to 10-year terms
- Access to up to 20 GIcs at once (worth $500,000)
- CDIC protection
Learn more: EQ Bank e-Transfer Limit
Peoples Trust
Peoples Trust has built an enduring reputation as one of the best providers of competitive GIC rates in Canada.
Based in Vancouver (BC), Peoples Trust’s history dates back to 1985, over three decades ago.
Unlike other digital banks, Peoples Trust’s generosity and uniqueness are reflected in its competitive interest in fixed-income securities.
Besides offering high interest on GICs, People also offers competitive savings rates. The bank currently offers up to 2.60% interest on its registered and non-registered accounts.
Below are the key features of People’s Trust GICs:
- $1,000 minimum investment required
- No monthly fees
- Non-redeemable GICs
- Available in registered accounts (TFSA and RRSP)
- 30-day to 5-year terms
Tangerine
Tangerine (Formerly ING Direct Canada) has been an alternative digital bank since its inception in 1997.
The bank’s popularity and reputation are directly linked to its unique offerings and generous promotions.
Currently, Tangerine offers up to a 5% promotional savings rate which is one of the highest interest rates in Canada. It offers up to a $400 welcome bonus to new clients for a limited time.
With the exception of 1-year GIC rates, Tangerine ranks among the top-five providers of the best GIC rates in Canada in the compilation.
The following are the key feature of Tangerine GIC accounts:
- No minimum investment required
- No monthly fees
- Terms range from 90 days to 5 years
- Available in registered accounts (RSP, RIF TFSA,) and USD accounts
Learn more: Tangerine Promotions For 2022
AcceleRate Financial
AcceleRate Financial is the digital banking arm of Crosstown Civic Credit Union.
Besides GICs, AcceleRate Financial also offers regular savings accounts, TFSAs, RRSPs and RRIFs.
The following are the GIC rates of AcceleRate Financial as of the time of this review:
| 1-Year Term | 4.50% |
| 2-Year Term | 4.60% |
| 3-Year Term | 4.70% |
| 4-Year Term | 4.90% |
| 5-Year Term | 5.10% |
| 6-Year Term | 5.00% |
| 7-Year Term | 5.00% |
Below are the key features of AcceleRate Financial GICs:
- No monthly fees
- $1,000 minimum investment amount
- Access to compound interest
- 1-year to 7-year GIC terms
- Funds are 100% insured by the Deposit Guarantee Corporation of Manitoba (DGCM)
Learn more: AcceleRate Financial Review
How to Buy GICs in Canada
After a careful review of the best GIC rates listed in this article, you should have one or two considerations.
Upon narrowing your selection, the next stage is knowing how to claim the best GIC rate that suits your situation.
Of course, you don’t want to just capitalize on the GIC rate, you want to choose a GIC account that best fits into your financial capacity, investment goals, and time horizon.
If you currently operate with any of the above financial institutions, all you will need is to reach out to the bank to set up a GIC account for you.
But if your bank doesn’t fall under the above options, it could mean that the bank doesn’t offer the best GIC rates or doesn’t even have GIC accounts.
In that case, you may want to switch to one of the above banks. It could be Saven Financial, Tangerine, People Trust or EQ Bank.
Note that different financial institutions have varying requirements for their GIC accounts.
However, the following are the common requirements for opening a GIC account:
- Valid identifications (such as birth certificate, driver’s license, and passport)
- Social Identification Number (SIN)
- Proof of residence (such as utility or cell phone bill)
READ ALSO
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Takeaways
Guaranteed Investment Certificates are a great way to increase your wealth in Canada.
However, the greatness of your GIC investment will depend significantly on the interest you accrue on it.
The above are some of the best GIC rates you would find at the moment in Canada. As you can see, the best rates are offered mostly by online banks.
That’s possible because online banks have lower operational costs compared to traditional brick-and-mortar banks.
So if you’re still banking with the big banks, their low GIC rates could be the turn-off for you.
Hopefully, now you know the best GIC rates in Canada and can decide the perfect place to invest your money.
If you need more clarification, kindly let me know in the comment below.
FAQs on the Best GIC Rates in Canada
What is the best timeline for GICs investments?
There is no one-answer-fits-all here. You need to review your financial conditions and capabilities accurately. This will help you to know how long you can keep your money away without touching it.
What’s the minimum amount required to invest in GICs?
The minimum amount needed differs from one GIC provider to the other. While some banks don’t require a minimum investment in GICs, most financial institutions require a minimum of $1,000.
Will I pay taxes on my interest on GICs investments?
It depends on the type of GIC account you’re in investment with. If you use a registered account, your interest is tax-sheltered. If you use a non-registered account, you would be taxed according to the standard rate.
Which bank is best for GICs in Canada?
The best bank for GICs in Canada depends on your situation. While you may be tempted to go with the bank that offers the highest interest rates, that could not be the perfect option for you.
A bank might offer higher rates but might be out of reach for you if you didn’t meet its eligibility. This is the case with Saven Financial.
Based on the above compilation, Saven Financial has the overall best GIC rates. However, the bank is only available in Ontario.
Also, as a credit union division of FirstOntario Credit Union, Saven requires a $25 membership fee to sign up with it. All this could be a barrier to many Canadians looking to access the Competitive GIC rates of Saven Financial.
Why should I invest in GICs?
The first reason is to earn guaranteed interest on your savings as opposed to the unstable interest of savings accounts.
The second reason could be to lower your investment risk as GIC accounts are mostly covered by licensed insurance bodies such as the CDIC.
