All Canadian Financial Institutions (Banks, Trust Companies and Credit Unions) are members of Deposit Insurance Corporations and coverage amounts depend on the Financial Institution. Banks and Trust Companies (including Mortgage Corporations) are members of the Canadian Deposit Insurance Corporation (CDIC). Credit Unions are covered by provincial insurance corporations.
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Bank and Trust Companies (including Mortgage Corporations) are members of the Canada Deposit Insurance Corporation. Please visitwww.cdic.cafor detailed coverage information and a list of member institutions.
Insurance Coverage for Credit Unions (by Province)
BritishColumbia
Credit Union Deposit Insurance Corporation (CUDIC) is a government corporation, established in 1958 that provides deposit insurance for members’ deposits. The Financial Institutions Commissions (FICOM), an agency of the Government of BC, is responsible for administering CUDIC and for regulating financial institutions operating in the province. For more information, visit www.fic.gov.bc.ca.
All money on deposit and money invested in non-equity shares with a BC credit union is 100% guaranteed, including foreign currencies and accrued interest, regardless of the length of the term to maturity.
Alberta
The Credit Union Deposit Guarantee Corporation (CUDGC) monitors and regulates the performance of credit unions in Alberta and the compliance of Alberta credit unions with the Credit Union Act. The primary role of the Corporation is to guarantee deposit protection to deposit holders with credit unions in Alberta. For more information, visit www.cudgc.ab.ca.
Each Alberta credit union is required to build and maintain capital to a level outlined in the Credit Union Act and Regulations. A credit union’s capital is comprised of retained earnings, and common shares and investment shares (if any) owned by its members.
The Credit Union Deposit Guarantee Corporation provides a 100% guarantee of all deposits with Alberta credit unions. This protection includes accrued interest to the date of payout. The Government of Alberta ensures that the Credit Union Deposit Guarantee Corporation’s obligation to depositors will be carried out.
Manitoba
The Deposit Guarantee Corporation of Manitoba (DGCM) commenced operations in 1965. Its mission is to guarantee deposits and maintain confidence in the Manitoba credit union system, by focusing on sound business practices, governance, performance and risk management. For more information, visit www.depositguarantee.mb.ca.
All deposit amounts are fully guaranteed and include accrued interest to the date of payout. Deposit amounts include chequing and savings accounts, RRSP deposits, RRIF deposits, foreign currency deposits and term deposits, including those with terms exceeding five years. There is no legislated requirement for the Manitoba government to provide financial support to credit unions.
Ontario
The Financial Services Regulatory Authority of Ontario (FSRAO) is a Provincial Agency providing deposit insurance protection for the members of Ontario Credit Unions and Caisses populaires. For more information, visit www.fsrao.ca.
FSRAO’s insured institutions pay premiums to FSRAO to cover the cost of insuring your deposits. In the event that a credit union is unable to repay all of its deposits, FSRAO pays these up to the maximum prescribed limit of $250,000 for deposits held in each of the separate categories of FSRAO deposit insurance coverage.
Deposit insurance covers eligible deposits up to the prescribed statutory limit of $250,000. FSRAO automatically insures savings and chequing accounts, term deposits (GICs), money orders, certified cheques and registered accounts.
Saskatchewan
Credit Union Deposit Guarantee Corporation (CUDGC) guarantees the full repayment of deposits held in Saskatchewan credit unions. The Corporation is the primary regulator for Saskatchewan credit unions. For more information, visit www.cudgc.sk.ca.
Deposits held in Saskatchewan credit unions are fully guaranteed. There is no limit to the size of deposit covered by the guarantee – whether $100 or $1,000,000 or more. All deposits are fully guaranteed.
The Corporation’s system of deposit protection, including preventive approaches, strong levels of credit union capital and a strong guarantee fund, ensures even the largest deposits are fully guaranteed.
FAQs
Benefit from Laddering Maturities. Developing a laddered maturities plan can be an effective way to help you maximize GIC returns while maintaining a secure portfolio. This proven method of investing can help you reduce the risk of interest rate fluctuations and increase your portfolio's overall return.
Is it safe to use a GIC broker? ›
If you're intimidated by the stock market.
In this case, a GIC is a great option for investing beginners. It's guaranteed, so your money is safe, and the interest rates are often better than those offered by high-interest savings accounts.
Who has the highest GIC rates? ›
The best rates overall as of May 3, 2023.
- 1-year GIC: 5.15% (WealthONE Bank of Canada)
- 2-year GIC: 5.05% (WealthONE Bank of Canada)
- 3-year GIC: 4.85% (Peoples Bank of Canada)
- 4-year GIC: 4.80% (WealthONE Bank of Canada)
- 5-year GIC: 4.72% (Motive Financial)
Unlike GICs, HISA ETFs do not have a lockup period. Investors are free to sell their shares anytime. There's no requirement to hold them for a fixed period. This makes them great for investors who need flexibility or a risk-off asset for market-timings strategies.
What are the negatives of GIC? ›
Disadvantages of GICs
Not all investment returns are taxed equally, and unlike capital gains and dividends, interest income earned from GICs is fully taxable in the year received. GICs typically offer very low returns, especially after accounting for taxes and inflation, which can erode your purchasing power.
How not to get ripped off on GIC rates at banks? ›
So consider a few other options:
- - A GIC broker: They can shop the market for the best mix of rates and terms to match your needs. ...
- - Buy direct from alternative GIC issuers: Some of the highest rates are available from Oaken Financial, which deals directly with investors and not through brokers.
A GIC (guaranteed investment certificate) is a safe and secure investment with very little risk. You don't have to worry about losing your money because it is guaranteed. A GIC works like a savings account in that you deposit money into it and earn interest on that money.
Can a US citizen buy a GIC in Canada? ›
To purchase a Guaranteed Investment Certificate (GIC), a US citizen will require an active chequing account with a Canadian Financial Institution and a TIN (Individual Tax Identification Number) for tax processing issued by the IRS. Some institutions require a Canadian Social Insurance Number (SIN).
What is a better investment than GIC? ›
Canadian bonds have typically outperformed GICs
Since the creation of the FTSE Canada Universe Bond Index, Canadian bonds have outperformed GICs nearly 80% of the time on a one-year rolling basis (Bloomberg). Typically, when investors compare GICs to bonds, they only compare the current GIC rate to the bond yield.
Where can I get 5% interest on my money? ›
Best 5% interest savings accounts
- UFB Premier Savings (previously known as UFB Preferred Savings)
- Varo Savings Account.
- Mango Savings™
- Western Alliance Bank Savings Account.
- Newtek Bank Personal High Yield Savings.
- CFG Bank High Yield Money Market Account.
- Laurel Road High Yield Savings®
- Bask Interest Savings Account.
While 7% with Landmark Credit Union is the highest available interest rate, other high-yield savings accounts exist and may be more worth it based on each bank's unique requirements.
What is the equivalent of GIC in USA? ›
The GIC works much like a certificate of deposit in the U.S. In the case of GICs, you deposit money in the bank and earn interest on that money. The catch is, the money must be deposited for a fixed length of time, and interest rates vary according to how long that commitment is.
How do I choose a good GIC? ›
The best GIC is the one that best suits your financial situation and investment goals. Before choosing, consider different criteria such as initial investment, type of return, investment horizon, etc. To help you decide, here are the terms and conditions of the different types of GICs we offer.
How much interest do you get in a GIC? ›
U.S. Dollar GIC (Long-Term and Simple Interest) – Non-Cashable
| Term | Non-registered* |
|---|
| 1 year | 3.75% |
| 2 years | 3.50% |
| 3 years | 3.50% |
| 4 years | 3.50% |
1 more rowThe principal amount multiplied by the GIC interest rate: a $100,000 investment at 2% = $2,000 paid to you each year.
Why not to buy a GIC? ›
The biggest risk you may face with GICs is the potential for capital erosion, or the potential for your GIC's interest rate to lag behind the current rate of inflation.
Which investment would be riskier a GIC or a mutual fund? ›
Comparing GIC vs. Mutual Fund Returns. GICs typically offer lower returns than mutual funds, but they also carry less risk. That's because over the long term, mutual funds have historically outperformed GICs.
What happens to GIC if not renewed? ›
But if you don't take action when a GIC matures, just what happens to your money? Usually, if you fail to instruct the financial institution to do something when your GIC matures, it will be rolled over to a similar investment product at the prevailing rate.
How do I get my GIC money back? ›
The investment may only be refunded after a satisfactory verification of your visa/study permit is being declined or cancelled. You must prove this by providing the relevant confirmation that you would have received from the Canadian visa office.
What do banks do with GIC money? ›
When a customer of a bank or credit union purchases a GIC, they're lending their money to the financial institution issuing the certificate. The bank or credit union then lends that money to other customers at a higher interest rate, usually in personal loans or mortgages.
GICs are offered in two variations—redeemable (or “cashable”), which allow you to get your money back at any time with no penalty for early redemption, or non-redeemable, where you will have to pay a penalty if you need to get your money back before reaching the date of maturity.
How does GIC laddering work? ›
Laddering GICS reduces the impact of interest rate changes on your investment. If interest rates rise, you can take advantage of the higher rates by reinvesting the money from the GIC that matures at that time.
What percentage of my portfolio should be GIC? ›
Asset allocation is your mixture of equities and fixed-income. A 60/40 asset allocation means that 60% of the portfolio is invested in equities and 40% of the portfolio is invested in fixed-income like bonds or GICs.
What are the disadvantages of bond laddering? ›
Bond laddering also has some disadvantages:
- Since you hold the bonds up to maturity, you may be deprived of any capital gains if the interest rates fall.
- In a bond ladder, you may end up reinvesting your money at lower interest rates.
- For ladders, you must only invest in high-quality bonds to avoid default risk.
