1-2yr will be above 5% in Sept. hold the line | Page 2 | GIC discussions | Discussion forum

It's Aug 30th. Apparently some banks are lowering their 5 yr rate for GICs. I have $$$ that has come due today, and more coming due in the next week.
Is there any chance that the 1 or 2 year GIC rates will decrease ? Should I put the money into savings and wait for the B of C announcement?

FWIW, my bet is that we will only see sporadic increases in GIC rates after Sept 7; highly unlikely to be more than a quarter point.
It doesn't matter what the BoC does if there is reduced loan demand. That's the real question.

@RetirEd, it isn't necessarily true that one is worse off with savings account than one year GIC. It depends on how fast rates are rising. I bought a one year in Aug 2021 at 1.5, which was the bet rate going at the time. I lived to regret it!, was much better off with my savings accounts where, fortunately, I had significantly more money.

Loonie said
It depends on how fast rates are rising. I bought a one year in Aug 2021 at 1.5, which was the bet rate going at the time. I lived to regret it!, was much better off with my savings accounts where, fortunately, I had significantly more money.  

Same boat, here. Bought many 1-yr that summer. Oh, well. Somes you win; somes you lose. I didn't know about Hubert quarterly GIC at the time.

The Hubert one-year term was 1.30% in 2021 until it was raised to 1½% on November 18, 2021.

HermanH said
Thanks for the clarification. Guess we both went with the best rate available to us, at that time.  

Thats exactly the reason why when someone chooses to have only GIC in their investments, laddering is a must. Yet I am seeing a lot of people waiting for 1 year to hit 5%, while earning only 3% or less currently.

Loonie and savemoresaveoften: No argument there... just noting that there was a downside as well as an upside to waiting on a rate. I'm not claiming that it's the dominant force.

I didn't buy a 1-year while waiting, but kept the cash in a deposit HISA which gradually rose from about 1.25% to 2.25% while I waited, so I didn't have to wait a year (or any quarterly or other partial withdrawal key date) to make the jump.

I'm not kicking myself. I did alright with the 3-year earlier, when it only brought 3.4% and started earning that (back in May, I think) right off. And it filled my three-year-ladder gap. Most of us are short-laddered from the COVID-19 rate doldrums.

But I am very satisfied I locked in near-peak August deposits (with annual payouts) for 2- and 5-year terms. At an institution I'm happy to deal with, sends me free monthly statements, solves problems quickly and generously, and answers the phone reasonably. A decade with them and no desire to drop them.

RetirEd

We do what we think best for ourselves, including what level of insecurity we can tolerate and for how long.

HermanH said

Same boat, here. Bought many 1-yr that summer. Oh, well. Somes you win; somes you lose. I didn't know about Hubert quarterly GIC at the time.  

Mistakes I made last year will be maturing in November and December. Hope to see 5% 1yr GIC by then, but even current 4.0%-4.5%, if it holds, is good enough for me.

hwyc said
5% 2y term is already a reality in Ontario ... look beyond the chart. Not sure if that counts.  

Care to share who is offering 5% on 2 Yr GIC's? Not showing on any of the sources I track.

Stephen

Nehpets said

Care to share who is offering 5% on 2 Yr GIC's? Not showing on any of the sources I track.

Stephen  

Equity credit union was offering 5% 2y 2 weeks ago.

Speaking of them, I sent it all req doc about 2 weeks ago and still waiting for them to finish opening the acct for me. Not the fastest turn around if u ask me. I don’t mind it only cuz will wait to see whether it’s 75 or 100 at next week’s meeting first anyway.

You guys got this