It's here Oaken 5% for 5 years | Page 3 | Oaken Financial | Discussion forum

Loonie said
Thanks for the response.

I guess you have 3 options, then.

1. Lock it all in at 5%
2. Spread it out. Buy four GICs, for varying lengths, omitting the maturity year you already have in place. This will create a GIC ladder. When the one that is due next year matures, you buy a five year one with it plus your new contribution for 2023; the following years, you do the same, so that after a few years they are all in five year GICs which is usually where best rates are.
3. Wait for higher rates and proceed with either 1. or 2.

Nobody knows where rates are going next year. They tell us they will settle down, and maybe they will, but I don't know. I am inclined to think higher rates will last longer than anticipated, just as so-called "temporary" inflation has gone well beyond that. Those in authority always tend to want us to think crises are temporary, but we have to determine whether that is likely.

If I were in your position, I would try to look beyond the returns over the next five years, as this is a longer term investment. I would go for the ladder because it gives me options to adjust as the years go buy, averaging out my rate. You will never get the best rate at all times. But, yes, it could turn out that you'd have been better off putting it all in five year GICs this year. What you hope for is a good average over time.

If you decide to go ahead and buy five year GIC this year, I would wait a bit longer. There is at this point every reason to assume the rate will improve.

One thing you can do right now, regardless, is narrow your list of FIs. Identify the ones that will be willing to hold their rate until your transfer goes through. You don't want to find yourself trying to grab a 6% rate only to find that by the time your funds arrive they will only give you 5.5 or whatever because rates have gone down. Find the FIs that will hold the rate for you, and focus on them. I'm sorry, but I don't have that information right now. I think most FIs will cooperate on this but I wouldn't assume it.  

Thanks for the detailed response. It's very helpful.

I guess that I'll wait a bit longer to see what happens after the next rate hike. Then based on how close the rates are together for the different term lengths and the likelihood of future rate hikes, I'll decide whether to ladder the GICs are only buy 5 years.

Oaken will offer you 90 day short term deposits on registered accounts
You could always keep renewing that and add your new money at one of those intervals

Alexandra said
I have RRIFs and TFSA GICs with them.  

Does Oaken have self-directed RRIF's and LIF's?

MattS said

They told me for my rrsp I was only able to get the 90 day as I wanted 30 days just to get past July 13.. but I’m stuck till sept now  

That's not great if you're stuck, but rates should go up again around then as the next BoC announcement is on Sep 7th, I think. Maybe another 75 to 100 basis points is coming.

Anyone think Oaken will raise rates in the next few days, or was this (rather substantial) increase in the prime rate already baked in?

Laertes said
Anyone think Oaken will raise rates in the next few days, or was this (rather substantial) increase in the prime rate already baked in?  

Oaken's GIC rates today for 1 to 4 yrs. are further down the list than normally, so I would definitely not be surprised to see increases this week.

Have mortgage rates gone up yet? Prime has already increased.