GIC
A guaranteed return for a fixed term.
What it is
You deposit money for a set term and earn guaranteed interest.
Best for
Safety + predictability (short/medium goals).
Watch for
Lock-in rules and the rate vs inflation.
Quick take
- Low risk.
- Return is known up front (fixed GIC).
- Often locked until maturity.
- Good for saving goals, not max growth.
Key terms
- Term: 1–5 years (common).
- Fixed vs variable rate.
- Cashable vs non-cashable.
- Paid at maturity or yearly.
Pros
| Topic | Notes |
|---|---|
| Safe | Principal is typically protected. |
| Predictable | Rate + term are clear. |
| Simple | No daily monitoring. |
| Goal-friendly | Works for near-term plans. |
Cons
| Topic | Notes |
|---|---|
| Locked-in | Hard to access early. |
| Lower growth | Usually lags stocks/index funds long-term. |
| Inflation risk | Real return may be low. |
| Opportunity cost | Money can’t pivot quickly. |
Educational content only — not financial advice.