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Guaranteed Investment Certificate
What is a GIC?
A Guaranteed Investment Certificate (GIC) is a safe investment option that ensures the full preservation of your initial capital, coupled with the opportunity to earn interest through either a fixed or variable rate, or in accordance with a predefined formula.
Essentially, a GIC functions as a savings product where you provide funds to a financial institution, and in return, you are assured a set interest rate. However, your funds are typically inaccessible for a predetermined period, ranging from 30 days to a maximum of 10 years.
Duration of GIC's
The duration of the GIC's term directly correlates with the amount of interest you will earn. You have the option to receive interest payments on a monthly, quarterly, annual, or maturity basis. Upon reaching the end of the term, you will receive your entire principal amount along with any outstanding interest. Be cautious about withdrawing your funds prematurely, as there could be associated penalties. Consequently, it is advisable to avoid using a GIC for funds you may require quick access to.