Log In
Register
Home
Topic RSS
Facebook
Twitter
Email this12:04 pm
November 7, 2014
Offline
As per Peter's suggestion, here is a separate thread identifying this rate special.
5 Year Escalator (Minimum $500 deposit, RSP and RIF eligible) Rates
1st Year 1.50%
2nd Year 2.50%
3rd Year 3.50%
4th Year 4.50%
5th Year 5.50%
Average rate of 3.50%
https://www.luminusfinancial.com/Personal/Rates/
Again, this has been available for a while. Don't know how long it will last.
9:32 am
November 7, 2014
Offline
FYI : These escalator GICs are not cashable on the anniversary dates. Interest may be compounded or paid annually. They say a T5 will be issued annually in either case.
10:16 am
December 12, 2009
Offline
gicjunkie said
FYI : These escalator GICs are not cashable on the anniversary dates. Interest may be compounded or paid annually. They say a T5 will be issued annually in either case.
Yeah, as long as the interest is compounded to the GIC annually, institutions in my experience report the interest annually on a T5 (which is what I want). I don't want them to compound the interest internally without showing a compound interest line item on the GIC "account" because then I'd have to pay tax on the interest at maturity instead of annually.
Cheers,
Doug
1:27 pm
November 7, 2014
Offline
Doug said
Yeah, as long as the interest is compounded to the GIC annually, institutions in my experience report the interest annually on a T5 (which is what I want). I don't want them to compound the interest internally without showing a compound interest line item on the GIC "account" because then I'd have to pay tax on the interest at maturity instead of annually.
Cheers,
Doug
The problem is always that they say they will issue the T5, then they don't. I am finding more and more mistakes being made these days on procedural issues. One must always pay attention to the details. The CRA wants interest accrued annually and I don't want CRA problems later on when the total is paid.
7:01 pm
February 20, 2018
Offline
why not 3.5 each year better compounding effect right than the step-up
10:11 am
February 20, 2018
Offline
gicjunkie said
5 Year Escalator Rates
1st Year 1.50%
2nd Year 2.50%
3rd Year 3.50%
4th Year 4.50%
5th Year 5.50%
Average rate of 3.50%
Is the compounding effect on this escalator the same as good if the 3.5 was spread out evenly 3.5 annually times 5? What's the compounded yield at maturity?
3:07 pm
November 7, 2014
Offline
According to my rudimentary math skills, the difference is about $56.00 in total on a $100.000.00 investment over the five years, in favour of the 3.50% annual compounding. Not worth quibbling about. The average annual yield is 3.7538%.
Please write your comments in the forum.