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JUMP AHEAD to compare the current highest rates available on short-term GICs
Guaranteed investment certificates, or GICs, come in many varieties. One popular type is the short-term GIC.
Choosing which short-term GIC to put your money into often depends on how much interest you can earn. Below, you’ll find the best rates currently available in Canada for short-term, non-redeemable and fixed-rate GICs.
1-month and
2-month GIC rates
3-month and
4-month GIC rates
6-month and
9-month GIC rates
ALSO CONSIDER: The best 1-5 year GIC rates
Shop GICs with EQ Bank
Lock in 5.10% on a 1-year GIC with EQ Bank, one of our picks for the best 1-year GICs.
Current highest short-term GIC rates
The best short-term GIC rates overall as of Dec. 20, 2023.
- 30-day GIC: 4.30% (VersaBank)
- 60-day GIC: 4.30% (VersaBank)
- 90-day GIC: 4.50% (VersaBank)
- 120-day GIC: 4.50% (VersaBank)
- 180-day GIC: 5.05% (Bridgewater Bank)
- 270-day GIC: 5.30% (Tangerine Bank)
Best short-term GIC rates in Canada
1-month GICs
VersaBank Short Term 30 Day GIC
Term Length
30 days
Interest Rate
4.30%
As of December 6, 2023
Min. Deposit
$1,000
Minimum deposit on monthly certificates is $5,000.00.
Bonus Offer
N/A
Why we like it
- Founded in the 1990s, VersaBank is a branchless bank providing innovative banking alternatives for their clients. The bank extends a variety of savings and investment products through their Canadian network of deposit brokers and financial advisors.
- VersaBank GICs consistently offer attractive regular interest rates on non-registered and TFSA options.
Product details
- Minimum deposit required is $1,000.00. For monthly certificates is $5,000.00.
- Fixed-rate, non-redeemable GICs available monthly, semi-annually and annual interest payments.
- Term options range from short-term (30-59 days to 270-364 days) and long-term, 1 to 5 years.
- TFSA GICs are also available.
- Assignable, transferable and available in terms from thirty days to five years. A nominal fee may apply.
- Certificates are non-redeemable before maturity.
- Eligible for CDIC insurance.
Peoples Bank Short Term 30 Day GIC
Term Length
30 Days
Interest Rate
3.40%
As of December 6, 2023
Min. Deposit
$1,000
Bonus Offer
N/A
Why we like it
- The Peoples Bank GICs are transferable and assignable with no transfer, setup or service fees, making them a nice choice for those who prefer to manage their investments without worrying about additional fees.
- Peoples Trust and Peoples Bank of Canada are subsidiaries of the Peoples Group. Peoples Trust offers savings accounts, registered and non-registered GICs, and mortgage and lending services.
Product details
- Non-registered and non-redeemable.
- When the term ends, and if your instructions for the maturing GIC are not received by the bank, the principal and interest will automatically renew for the same term at the posted rate in effect on the maturity date. After the renewal, you will have 10 business days to either cancel the transaction or change the term of your account.
- Terms range from short-term investments of 30 to 270 days or long-term investments of 1-5 years.
- Competitive rates are guaranteed for the full term.
- Short-term investments with interest paid at maturity.
- Long-term investments with your choice of annual or compounding interest.
- Transferable and assignable.
- Electronic monthly statements.
- Minimum deposit of $1,000.
- No transfer, setup or service fees.
- Eligible for deposit insurance from the Canada Deposit Insurance Corporation (CDIC).
Canadian Western Bank Short Term 30 Day GIC
Term Length
30 Days
Interest Rate
3.00%
As of December 6, 2023
Min. Deposit
$5,000
Bonus Offer
N/A
Why we like it
- Canadian Western Bank offers fixed long-term GICs in one to ten year terms, fixed short-term GICs and floating rate redeemable GICs, as well as rate specials, US dollar deposits, and TFSA, RRSP, RRIF and RESP GICs.
- Canadian Western Bank offers business banking, investing products, registered plans, and personal banking, including loans, mortgages, credit cards, and chequing and savings accounts.
Product details
- Available with annual interest, a monthly payment option with annual interest, a monthly payment option with Gold Leaf PLUS Annual interest (package available to clients 57 and over), and with US Dollar deposits.
- Minimum $1,000 CAD deposit.
- Available to Personal & Business clients in CAD funds only.
- All rates are calculated on a per annum basis, applicable for deposits up to $5,000,000 CAD subject to change without notice, and interest is paid out at maturity. For deposits greater than $5,000,000, please contact your local banking centre.
- Canadian Western Bank is a member of CDIC.
RBC Short Term 30 Day GIC (Non-redeemable)
Term Length
30 Days
Interest Rate
2.80%
Interest rate for a non-registered, non-redeemable 30 – 59 days GIC
As of December 6, 2023
Min. Deposit
$5,000
$500 for RRSP, TFSA, RESP, RDSP; $1,000 RRIF, LIF, PRIF, and Non-Registered GICs of terms greater than 1 year; $5,000 (for terms between 30-364 days) or GICs with monthly interest payment option; $100,000 (for terms less than 30 days).
Bonus Offer
N/A
Why we like it
- Royal Bank of Canada, or RBC GICs offer a variety of terms and convenience of choice — cashable, non-redeemable, market-linked, US Dollar, redeemable and registered investments to fit the investor’s financial plans.
- Royal Bank of Canada, founded in 1864, is one of the global Canadian Big Six banks that offers numerous banking, lending and investment products to match individual or business needs. Read our RBC bank review for more information.
Product details
- The minimum deposit for a non-registered plan is $1000 and registered plan is $500.
- Eligible for non-Registered, RRSP, TFSA, RESP, RRIF, LIF and RDSP plans. Some conditions apply.
- The principal and interest rate for this guaranteed-return GIC is guaranteed when held to maturity.
- Interest rate calculated on a per annum basis.
- For terms greater than or equal to one year, the available interest payment frequencies include: Monthly, semi-annually, annually or at maturity (interest compounded annually). Conditions apply.
- Eligible for CDIC deposit insurance.
HSBC Bank Canada Short Term 30 Day GIC
Term Length
30 Days
Interest Rate
2.75%
As of December 6, 2023
Min. Deposit
$500
Bonus Offer
N/A
Why we like it
- HSBC offers redeemable and non-redeemable GICs with competitive fixed interest rates, and a variety of terms and interest payment options.
- HSBC is one of the largest global banks offering financial services like wealth, personal and commercial banking in over 62 countries.
Product details
- A $500 minimum deposit is required.
- Interest payment options are available.
- For 1-year terms, interest is paid semi-annually or at maturity based on simple interest, calculated daily.
- For 2-5 year terms, interest is paid either semi-annually or annually.
- Compound interest option available on 1-5 year terms and paid on maturity.
- For 30-day and 60-day terms, interest is paid at maturity and for 90-day to 270-day terms: Interest is paid monthly or at maturity based on simple interest, calculated daily.
- Redemption or withdrawal of all or part of the Non-redeemable GIC before the end of the term is not allowed. If HSBC allows you to withdraw before the end of the term, no interest will be paid on the withdrawn amount.
- You can choose to have your principal or principal plus interest renewed at maturity. If you don’t notify HSBC before your Canadian GIC matures, your GIC will renew it automatically at the prevailing, posted rate (certain restrictions apply).
- Eligible for CDIC Insurance.
3-month GICs
VersaBank Short Term 90 Day GIC
Term Length
90 Days
Interest Rate
4.50%
As of December 6, 2023
Min. Deposit
$5,000
Minimum deposit on monthly certificates is $5,000.00.
Bonus Offer
N/A
Why we like it
- Founded in the 1990s, VersaBank is a branchless bank providing innovative banking alternatives for their clients. The bank extends a variety of savings and investment products through their Canadian network of deposit brokers and financial advisors.
- VersaBank GICs consistently offer attractive regular interest rates on non-registered and TFSA options.
Product details
- Minimum deposit required is $1,000.00. For monthly certificates is $5,000.00.
- Fixed-rate, non-redeemable GICs available monthly, semi-annually and annual interest payments.
- Term options range from short-term (30-59 days to 270-364 days) and long-term, 1 to 5 years.
- TFSA GICs are also available.
- Assignable, transferable and available in terms from thirty days to five years. A nominal fee may apply.
- Certificates are non-redeemable before maturity.
- Eligible for CDIC insurance.
Peoples Bank Short Term 90 Day GIC
Term Length
90 Days
Interest Rate
4.00%
As of December 6, 2023
Min. Deposit
$1,000
Bonus Offer
N/A
Why we like it
- The Peoples Bank GICs are transferable and assignable with no transfer, setup or service fees, making them a nice choice for those who prefer to manage their investments without worrying about additional fees.
- Peoples Trust and Peoples Bank of Canada are subsidiaries of the Peoples Group. Peoples Trust offers savings accounts, registered and non-registered GICs, and mortgage and lending services.
Product details
- Non-registered and non-redeemable.
- When the term ends, and if your instructions for the maturing GIC are not received by the bank, the principal and interest will automatically renew for the same term at the posted rate in effect on the maturity date. After the renewal, you will have 10 business days to either cancel the transaction or change the term of your account.
- Terms range from short-term investments of 30 to 270 days or long-term investments of 1-5 years.
- Competitive rates are guaranteed for the full term.
- Short-term investments with interest paid at maturity.
- Long-term investments with your choice of annual or compounding interest.
- Transferable and assignable.
- Electronic monthly statements.
- Minimum deposit of $1,000.
- No transfer, setup or service fees.
- Eligible for deposit insurance from the Canada Deposit Insurance Corporation (CDIC).
EQ Bank Short Term 3 Month GIC
Term Length
90 Days
Interest Rate
3.75%
As of December 23, 2023
Min. Deposit
$100
Bonus Offer
N/A
Why we like it
- Each EQ Bank GIC starts with a minimum deposit of $100, making it convenient for a new investor to explore these GICs at a competitive fixed rate.
- EQ Bank, a trademark of Equitable Bank, is an online bank based in Toronto that offers chequing and savings accounts, GICs and registered plans. Read our review of EQ Bank for more information.
Product details
- Non-registered and non-redeemable.
- Must have an EQ savings account in order to get an EQ GIC.
- When the term ends and your GIC reaches the maturity date, the funds will be placed in your Savings Plus Account (the one from which your initial investment was funded). You will receive an email or SMS alert notifying you of the GIC maturity.
- Term options range from 3-months to 10-years. You’re the one in charge of your savings, that includes choosing whether short or long term GICs are right for you.
- RSP and TFSA GICs are also available. Before you buy, you’ll need to open an RSP Savings Account or TFSA Savings Account.
- GIC options let you lock in any of our amazing rates, so no matter what happens, that rate is yours.
- Low minimum deposit. So you can start investing in GICs with as little as $100.
- You choose how your interest is paid out, either at maturity or annually.
- A GIC in seconds. As long as you have available funds in your Savings Plus Account, you can literally buy a GIC in seconds.
- You can buy up to 20 GICs. Each GIC purchase must be for at least $100, and can be up to a maximum of $100,000. Customers can hold up to $500,000 in GICs, excluding interest earned.
- *EQ Bank GICs are non-redeemable.
- For GIC terms of less than one year, simple interest is calculated on a per diem basis and paid at maturity. For GIC terms equal to one year, simple interest is calculated on a per annum basis and paid at maturity. For GIC terms of over one year, not including 15 and 27 month terms, interest is calculated on a per annum basis and paid either annually (simple interest) or at maturity (compounded annually).
- For GIC terms of 15 and 27 months, interest is calculated on a per annum basis, compounded annually and paid solely at maturity. In all cases, interest is accrued for the entire GIC term.
- Maximum 20 GICs per customer. Per GIC investment limit of $100,000. Aggregate GIC investment limit of $500,000.
- Rates are calculated on a per annum basis and are subject to change at any time.
- Equitable Bank is a member of CDIC. EQ Bank is a trade name of Equitable Bank.
Meridian Credit Union 90 Day GIC (Non-redeemable)
Term Length
90 Days
Interest Rate
3.50%
As of December 6, 2023
Min. Deposit
$5,000
Minimum $100 deposit on GIC terms over 1 year
Bonus Offer
N/A
Why we like it
- Earn a modest interest rate on long- and short-term GICs available across registered and non-registered accounts.
- Meridian, Ontario’s largest credit union is backed by more than 75 years of banking experience and offers many of the same financial solutions as the big banks.
Product details
- Flexible term lengths from 30 days to 5 years for any risk profile.
- Competitive fixed rates with guaranteed principal and earned income.
- Available in non-registered, RRSP, RRIF and TFSA.
- Eligible deposits in registered accounts have unlimited coverage through the Financial Services Regulatory Authority (FSRA). Eligible deposits in non-registered accounts are insured up to $250,000 through the Financial Services Regulatory Authority (FSRA).
6-month GICs
Bridgewater Bank Short Term 180 Day GIC
Term Length
180 Days
Interest Rate
5.05%
As of December 6, 2023
Min. Deposit
$5,000
Bonus Offer
N/A
Why we like it
- Bridgewater Bank, headquartered in Calgary, was established in 1997 as a wholly-owned subsidiary of Alberta Motor Association (AMA). The branchless bank offers high-interest savings accounts, GICs and mortgages via online banking and over the phone.
- Bridgewater Bank GIC regular interest rates compete with many leading banks in Canada but only come with a non-registered investment option.
Product details
- No monthly fees.
- Leading interest rates.
- Fixed interest throughout your term.
- On GICs having terms of one year or longer, interest is calculated daily and is either paid monthly, annually, or compounded annually and paid at maturity as per customer requests.
- Monthly interest payment option available at a rate of 0.25% lower than the above indicated annual rates.
- GICs are non-redeemable prior to maturity. Cashable GICs are cashable after 30 days of the date of issue.
- Non-registered investment options.
- Personal deposits only.
- Canada Deposit Insurance Corporation (CDIC) eligible.
Peoples Bank Short Term 180 Day GIC
Term Length
180 Days
Interest Rate
5.00%
As of December 6, 2023
Min. Deposit
$1,000
Bonus Offer
N/A
Why we like it
- The Peoples Bank GICs are transferable and assignable with no transfer, setup or service fees, making them a nice choice for those who prefer to manage their investments without worrying about additional fees.
- Peoples Trust and Peoples Bank of Canada are subsidiaries of the Peoples Group. Peoples Trust offers savings accounts, registered and non-registered GICs, and mortgage and lending services.
Product details
- Non-registered and non-redeemable.
- When the term ends, and if your instructions for the maturing GIC are not received by the bank, the principal and interest will automatically renew for the same term at the posted rate in effect on the maturity date. After the renewal, you will have 10 business days to either cancel the transaction or change the term of your account.
- Terms range from short-term investments of 30 to 270 days or long-term investments of 1-5 years.
- Competitive rates are guaranteed for the full term.
- Short-term investments with interest paid at maturity.
- Long-term investments with your choice of annual or compounding interest.
- Transferable and assignable.
- Electronic monthly statements.
- Minimum deposit of $1,000.
- No transfer, setup or service fees.
- Eligible for deposit insurance from the Canada Deposit Insurance Corporation (CDIC).
EQ Bank Short Term 6 Month GIC
Term Length
180 Days
Interest Rate
4.50%
As of December 23, 2023
Min. Deposit
$100
Bonus Offer
N/A
Why we like it
- Each EQ Bank GIC starts with a minimum deposit of $100, making it convenient for a new investor to explore these GICs at a competitive fixed rate.
- EQ Bank, a trademark of Equitable Bank, is an online bank based in Toronto that offers chequing and savings accounts, GICs and registered plans. Read our review of EQ Bank for more information.
Product details
- Non-registered and non-redeemable.
- Must have an EQ savings account in order to get an EQ GIC.
- When the term ends and your GIC reaches the maturity date, the funds will be placed in your Savings Plus Account (the one from which your initial investment was funded). You will receive an email or SMS alert notifying you of the GIC maturity.
- Term options range from 3-months to 10-years. You’re the one in charge of your savings, that includes choosing whether short or long term GICs are right for you.
- RSP and TFSA GICs are also available. Before you buy, you’ll need to open an RSP Savings Account or TFSA Savings Account.
- GIC options let you lock in any of our amazing rates, so no matter what happens, that rate is yours.
- Low minimum deposit. So you can start investing in GICs with as little as $100.
- You choose how your interest is paid out, either at maturity or annually.
- A GIC in seconds. As long as you have available funds in your Savings Plus Account, you can literally buy a GIC in seconds.
- You can buy up to 20 GICs. Each GIC purchase must be for at least $100, and can be up to a maximum of $100,000. Customers can hold up to $500,000 in GICs, excluding interest earned.
- *EQ Bank GICs are non-redeemable.
- For GIC terms of less than one year, simple interest is calculated on a per diem basis and paid at maturity. For GIC terms equal to one year, simple interest is calculated on a per annum basis and paid at maturity. For GIC terms of over one year, not including 15 and 27 month terms, interest is calculated on a per annum basis and paid either annually (simple interest) or at maturity (compounded annually).
- For GIC terms of 15 and 27 months, interest is calculated on a per annum basis, compounded annually and paid solely at maturity. In all cases, interest is accrued for the entire GIC term.
- Maximum 20 GICs per customer. Per GIC investment limit of $100,000. Aggregate GIC investment limit of $500,000.
- Rates are calculated on a per annum basis and are subject to change at any time.
- Equitable Bank is a member of CDIC. EQ Bank is a trade name of Equitable Bank.
VersaBank Short Term 180 Day GIC
Term Length
180 Days
Interest Rate
4.50%
As of December 6, 2023
Min. Deposit
$5,000
Minimum deposit on monthly certificates is $5,000.00.
Bonus Offer
N/A
Why we like it
- Founded in the 1990s, VersaBank is a branchless bank providing innovative banking alternatives for their clients. The bank extends a variety of savings and investment products through their Canadian network of deposit brokers and financial advisors.
- VersaBank GICs consistently offer attractive regular interest rates on non-registered and TFSA options.
Product details
- Minimum deposit required is $1,000.00. For monthly certificates is $5,000.00.
- Fixed-rate, non-redeemable GICs available monthly, semi-annually and annual interest payments.
- Term options range from short-term (30-59 days to 270-364 days) and long-term, 1 to 5 years.
- TFSA GICs are also available.
- Assignable, transferable and available in terms from thirty days to five years. A nominal fee may apply.
- Certificates are non-redeemable before maturity.
- Eligible for CDIC insurance.
Canadian Western Bank Short Term 180 Day GIC
Term Length
180 Days
Interest Rate
4.00%
As of December 6, 2023
Min. Deposit
$5,000
Bonus Offer
N/A
Why we like it
- Canadian Western Bank offers fixed long-term GICs in one to ten year terms, fixed short-term GICs and floating rate redeemable GICs, as well as rate specials, US dollar deposits, and TFSA, RRSP, RRIF and RESP GICs.
- Canadian Western Bank offers business banking, investing products, registered plans, and personal banking, including loans, mortgages, credit cards, and chequing and savings accounts.
Product details
- Available with annual interest, a monthly payment option with annual interest, a monthly payment option with Gold Leaf PLUS Annual interest (package available to clients 57 and over), and with US Dollar deposits.
- Minimum $1,000 CAD deposit.
- Available to Personal & Business clients in CAD funds only.
- All rates are calculated on a per annum basis, applicable for deposits up to $5,000,000 CAD subject to change without notice, and interest is paid out at maturity. For deposits greater than $5,000,000, please contact your local banking centre.
- Canadian Western Bank is a member of CDIC.
Compare top short-term GIC rates
Financial institutions do not present term lengths the same way, and some banks prefer to use days instead of months to indicate the length of the GIC’s term.
Before buying a GIC, confirm the term deposit’s actual date range so you can accurately calculate the return you can expect to earn on your investment.
Best 30-day and 60-day GIC rates
Top rates currently available for GICs with terms from 30 days (1 month) and 60 days (2 months). The estimated return is based on a $10,000 deposit.
| Financial Institution | 1 mo. | est. return | 2 mos. | est. return |
|---|---|---|---|---|
| ATB Financial (Alberta only) | 2.00% | $16.44 | 2.00% | $32.88 |
| Bank of Montreal (BMO) | 2.25% | $18.49 | 2.50% | $41.10 |
| Canadian Western Bank | 3.00% | $24.66 | 3.25% | $53.42 |
| Coast Capital Savings | 2.20% | $18.08 | 2.20% | $36.16 |
| Home Trust | 2.25% | $18.49 | 2.25% | $36.99 |
| HSBC Bank Canada | 2.50% | $20.55 | 2.60% | $38.63 |
| Kindred Credit Union (Ontario only) | 2.30% | $18.90 | 2.35% | $38.63 |
| Manulife Bank | 2.00% | $16.44 | 2.00% | $32.88 |
| Meridian Credit Union | 2.25% | $18.49 | 2.50% | $41.10 |
| Motusbank | 0.95% | $7.81 | 1.00% | $16.44 |
| Oaken Financial | 2.25% | $18.49 | 2.25% | $36.99 |
| Peoples Bank of Canada | 3.40% | $27.95 | 3.40% | $55.89 |
| Royal Bank of Canada | 2.80% | $23.01 | 3.05% | $50.14 |
| Scotiabank | 2.15% | $17.67 | 2.40% | $39.45 |
| TD Bank | 2.25% | $18.49 | 2.50% | $41.10 |
| VersaBank | 4.30% | $35.34 | 4.30% | $70.68 |
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Best 90-day and 120-day GIC rates
Top rates currently available for GICs with terms from 90 days (3 months) and 120 days (4 months). The estimated return is based on a $10,000 deposit.
| Financial Institution | 3 mos. | est. return | 4 mos. | est. return |
|---|---|---|---|---|
| ATB Financial (Alberta only) | 2.25% | $55.48 | 2.25% | $73.97 |
| Bank of Montreal (BMO) | 2.75% | $67.81 | 3.00% | $98.63 |
| Canadian Western Bank | 3.30% | $81.37 | 3.50% | $115.07 |
| Coast Capital Savings | 2.60% | $64.11 | 2.60% | $85.48 |
| EQ Bank | 3.75% | $92.47 | Not offered | N/A |
| Home Trust | 2.25% | $55.48 | 2.25% | $73.97 |
| HSBC Bank Canada | 2.75% | $67.81 | 2.75% | $90.41 |
| Kindred Credit Union (Ontario only) | 2.40% | $59.18 | Not offered | N/A |
| Manulife Bank | 2.85% | $70.27 | Not offered | N/A |
| Meridian Credit Union | 3.50% | $86.30 | Not offered | N/A |
| Motusbank | 1.05% | $25.89 | Not offered | N/A |
| Oaken Financial | 2.25% | $55.48 | 2.25% | $73.97 |
| Peoples Bank of Canada | 4.00% | $98.63 | 4.00% | $131.51 |
| Royal Bank of Canada | 3.30% | $81.37 | Not offered | N/A |
| Scotiabank | 2.75% | $67.81 | 2.75% | $90.41 |
| Tangerine Bank | 1.50% | $36.99 | Not offered | N/A |
| TD Bank | 2.75% | $67.81 | 3.00% | $98.63 |
| VersaBank | 4.50% | $110.96 | 4.50% | $147.95 |
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Best 180-day and 270-day GIC rates
Top rates currently available for GICs with terms from 180 days (6 months) and 270 days (9 months). The estimated return is based on a $10,000 deposit.
| Financial Institution | 6 mos. | est. return | 9 mos. | est. return |
|---|---|---|---|---|
| ATB Financial (Alberta only) | 2.50% | $123.29 | 2.50% | $184.93 |
| Bank of Montreal (BMO) | 3.25% | $160.27 | 3.50% | $258.90 |
| Bridgewater Bank | 5.05% | $249.04 | 5.05% | $373.56 |
| Canadian Western Bank | 4.00% | $197.26 | 4.50% | $332.88 |
| Canadian Imperial Bank of Commerce (CIBC) Bonus Rate GIC | 3.55% | $175.07 | 3.65% | $270.00 |
| Coast Capital Savings | 3.20% | $157.81 | 3.50% | $258.90 |
| EQ Bank | 4.50% | $221.92 | 4.75% | $351.37 |
| Haventree Bank | 2.01% | $99.12 | 2.36% | $174.58 |
| Home Trust | 2.25% | $110.96 | 2.70% | $199.73 |
| HSBC Bank Canada | 3.25% | $160.27 | 3.65% | $270.00 |
| Kindred Credit Union (Ontario only) | 3.40% | $167.67 | 3.60% | $266.30 |
| Laurentian Bank of Canada | 3.00% | $147.95 | 3.50% | $258.90 |
| Manulife Bank | 3.70% | $182.47 | 3.75% | $277.40 |
| Meridian Credit Union | 3.75% | $184.93 | 4.00% | $295.89 |
| Motusbank | 1.05% | $51.78 | 1.05% | $77.67 |
| National Bank of Canada | 1.50% | $73.97 | 1.85% | $136.85 |
| Oaken Financial | 2.25% | $110.96 | 2.70% | $199.73 |
| Peoples Bank of Canada | 5.00% | $246.58 | 5.25% | $388.36 |
| Royal Bank of Canada | 3.55% | $175.07 | 3.70% | $273.70 |
| Scotiabank | 3.25% | $160.27 | 3.55% | $262.60 |
| Tangerine Bank | 3.25% | $160.27 | 5.30% | $392.05 |
| TD Bank | 3.25% | $160.27 | 3.50% | $258.90 |
| Valley First (British Columbia only) | 3.05% | $36.78 | 3.25% | $224.78 |
| VersaBank | 4.50% | $221.92 | 4.75% | $351.37 |
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» MORE: Looking for a GIC with a longer term? Explore more of the best GIC rates in Canada
What to know about short-term GICs
What is a short-term GIC?
A short-term GIC is a type of GIC that pays a set amount of interest over a period that’s less than a year. Common term lengths for this investment product include 30-, 60-, 90- and 180-days.
Your principal deposit is guaranteed with a short-term GIC, so you’ll never come away with less than you originally invested. But, because the terms are short, you’ll earn limited interest. Some 90-day GICs, for example, pay less than 1% interest.
How do interest rates work on short-term GICs?
Financial institutions usually advertise fixed-rate GICs with annual interest rates, which means you can find out exactly how much interest you’d earn on your investment over the course of a year.
However, since you’ll hold a short-term GIC for less than one year, you won’t earn that total annual rate of interest. Instead, you’ll only earn interest at that annual rate of return during the GIC’s term, and that return on your principal investment will be less than you may expect.
How to calculate GIC return
While long-term GICs earn compounding interest — interest on your principal investment plus any interest you’ve already earned — short-term GICs do not. Instead, you’ll only earn interest on your principal investment, so you’ll need to use simple interest to calculate the rate of return.
To determine how much interest you’ll earn on your principal, follow this formula:
Simple interest earned = Principal investment x Interest rate x Time (in years).
This is quite easy with a one-year GIC.
For example, let’s say you put $1,000 into a one-year GIC paying 5% interest.
- Simple interest earned = $1,000 principal investment x 5% interest x 1-year term
- Simple interest earned = $1000 x .05 X 1
- Simple interest earned = $50
In this scenario, your GIC would earn $50 in interest at maturity.
However, this calculation gets more complicated for GICs held for less than a year. To calculate the rate of return here, you’ll need to convert the number of days in your term to a number measured in years before using the same simple interest formula.
For example, let’s say you put $1,000 into a 182-day GIC paying 5% interest.
- Simple interest earned = $1,000 principal investment x 5% interest x (182 days in the term / 365 days in a year).
- Simple interest earned = $1,000 x 0.05 x 0.499.
- Simple interest earned = $24.95.
In this scenario, your short-term GIC would earn you $24.95 in interest at maturity.
Are GICs good for a short-term investment?
Depending on the interest rate offered, a GIC can be a smart alternative to some basic and high-interest savings accounts. They’re secure, the returns are guaranteed and they don’t require much maintenance. If that’s important to you, a GIC investment is likely worth your money.
If you have an amount of cash that you don’t plan on touching for several months, a short-term GIC can help you earn a few extra dollars. It’s a great way to start investing. You can even earn tax-advantaged interest by purchasing a GIC within your TFSA or by using funds in your RRSP to buy GICs.
To get maximum value from a GIC, you need to keep your money parked for the full term. And if you’re not comfortable committing to that, make sure you get a cashable or redeemable GIC that allows you to withdraw your money early without penalty.
And if you’re comfortable investing your money for a little longer, you can always consider purchasing longer-term GICs, which are sold in yearly increments, to get access to higher interest rates and the ability to grow your return through a GIC ladder.
About the Author
Clay Jarvis is NerdWallet’s mortgage and real estate expert in Canada. Thus far, his entire professional writing career has revolved around real estate. Prior to joining NerdWallet, he was the…
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I can certainly help break down the article for you. This piece discusses short-term Guaranteed Investment Certificates (GICs) and the various options available in Canada. It covers multiple financial institutions offering GICs, showcasing their interest rates, terms, minimum deposits, and special features.
Let's start with GICs themselves. They're secure investments where you deposit money for a fixed period at a predetermined interest rate. The article categorizes GICs based on their duration, ranging from 30-day to 6-month terms. It provides specific details for each GIC term, including rates, minimum deposits, institutions offering them, and any notable features.
The article explains how GICs work, noting their fixed interest rates and how they guarantee your principal investment. It discusses the calculation of returns for GICs based on simple interest, emphasizing that shorter-term GICs tend to yield less interest due to their shorter duration.
Furthermore, the article advises on the suitability of GICs as short-term investments. It suggests that while GICs offer guaranteed returns and security, they might not generate significant returns in the short term compared to other investment options. Additionally, it mentions the advantages of tax-advantaged interest if GICs are purchased within TFSA or RRSP accounts.
Finally, the article provides a comparative table showcasing the best rates available across various banks for different GIC terms, making it easier for readers to compare options and select the most suitable GIC based on their preferences.
This comprehensive piece serves as a guide for individuals seeking to invest in short-term GICs in Canada, offering insights into rates, terms, institutions, and factors to consider before making an investment decision.
