Everyone knows that share prices go up and then they go down. It is said that if you aren’t fond of the share prices going up and going down, then back up again, you should check into GICs instead. The GIC rates vary, of course, depending on the bank and terms you choose when you decide to take this path. It’s important to note that smaller banks will probably offer better rates. If you are on the fence about GIC and whether it’s right for you, read on below for our list on the top benefits of GIC rates to be revealed.

1. You have guaranteed principal and also guaranteed interest

The great thing about GIC rates is that there are a couple of guarantees you should know about when you buy and hold the GIC for the entire term. First off, your principal is guaranteed. For example, if you invest $1,000, you get $1,000 back. Second, you are guaranteed that your interest rate will not fluctuate. You can’t be guaranteed of any of these things if you invest in the stock market instead.

2. GICs help to reduce your portfolio volatility

Everyone knows that stocks are at best a violate investment. To reduce this uncertainly, you can invest in GIC rates, which will in turn reduce the volatility of your portfolio. There is nothing worse than going to bed happy that your stock is way up, then waking up in the morning to find that it has crashed or dropped, and you have nothing like you thought you did before. GIC rates help to reduce that uncertainty for you.

3. There are a variety of GIC options available

Another great benefit of GICs is the variety of options and terms available on the market today. You can lock in your money for a long period of time or a short period of time, the choice is yours. The term lengths vary from as short of a time as 60 days onto a long period of 10 years. The great thing is that the choice is yours and no one else. You make the choice and you’re guaranteed to like this option or you can cancel it and cash in after the time you locked your money in for, making this a win-win situation for everyone involved.

4. There are two types of GICs to choose from

There are usually two types of GICs for you to choose from. The first one is redeemable GIC’s, which means, you can withdraw and get your funds any time you choose too. The second is non-redeemable GICs, which means that you can’t withdraw your funds unless you demonstrate a financial need to do so, such as a hardship that you need the funds for. There are other types of GIC’s, but these are the ones with the greatest benefits to you as the investor.

5. These GICs are RRSP eligible

No matter what you are wanting to buy your GICs for, they are eligible for both non-registered and registered account, making this one of the best benefits here. They are flexible, meaning you can use them for almost any type of savings goal you have. It is important to remember that when you’re looking for the best GIC rates, you need to shop around.

These are just a few of the top benefits of GICs for the investor. Remember, do your research well, take your time, shop around, and then decide what is the best GIC offer for you. You’ll be glad that you did, when your investment takes off and you save for what you want.

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