Add EQ Bank's 15 Month GIC ? | Site suggestions | Discussion forum

Loonie said

Another consideration might be how many people are interested in 18 month GICs, rather than how many FIs offer them. It's my impression that a lot of people are interested in them and even a few will draw traffic. They can be particularly useful when trying to straddle December/January with a TFSA.  

I get a good enough initial idea from the FIs' 1 and 2 year rates to satisfy me as to what interim rates might be, before investigating further if I'm interested at that time. Just my view only, all I would like is an addendum at the bottom of the GIC rates list, stating the names of those FI's who offer 15 month and/or 18 month GICs, not their rates.

Usually my interest in these is "time shifting", especially TFSA as Loonie said. I hate the January TFSA "GIC trap". Failing the Government finally getting rid of the TFSA limitations/rules that are (typically, like ArriveCan etc. etc.) only punitive and not helpful, these mid term GICs have a purpose. In a rising rate market, this could become more important than before.

dougjp: I don't think the rules on TFSAs are particularly onerous. I do worry, though, that they allow those with extra cash (like us) are getting a sweet tax deal. On the other hand, it begins to slightly level the playing field for the (to me) unconscionable tax breaks given to the housing market, which make housing unaffordable and enrich mortgage lenders.
RetirEd

The TFSA rules are a pain in the rear. Sometimes even I have trouble figuring out contribution room when trying to assist others.

Why should "serious" savers, so-called, have an advantage over those who can only afford to save for shorter time periods? Both are doing what they can. The TFSA programme is a freebie for those with more money. Those who complain about government spending never mention this.

Bill: Capital gains on principal residences are completely tax-exempt. (Provincial property transfer taxes, etc. are not canada-wide or universal even within jurisdictions.)

So savers who put money into reliable investments pay tax on their interest, while those who put them into principal-residence assets don't pay any tax on their capital gains. This tax advantage pushes housing values up in a feedback spiral as the attracted money drives up prices and attracts more money.

Those who set up businesses or investment corporations have tax advantages over savers, as they can deduct expenses (we can't even deduct TFSA transfer fees!) and get dividend tax credits.

In the US, it's even more tilted - it's morgtage INTEREST that's tax-exempt, which discourages paying off housing debt and frees up money to buy more property and drive the spiral.

Housing tax advantages were intended to help middle-income individuals get housing. They worked too well and the wealthiest benefit the most. I know several people who sold their beloved homes and bought bigger ones to keep more tax-exempt assets.
RetirEd

That capital gains tax in the US only kicks in after a gain of a half million dollars, for a couple. Even then, couples with a moderate income (about 81,000 USD) don't pay any capital gains tax at all. Thus saith the internet.

Not necessarily. It can equally motivate people to pay down and borrow again and make home improvements, which bolsters the economy.
Further, the sharp homeowner knows that paying interest is still a drain on the bank account, even if deductible.

I suspect the only people who are "disincentivized" by mortgage interest deductibility are those who live month to month anyway and may be "robbing Peter to pay Paul", as it were. They are in over their heads. One of the unfortunate aspects of the mortgage interest deductibility programme is that it's hard to stop or make a prudent decision to downsize to something you can afford. According to friends who moved from US to Canada some years ago, the system required them to buy another house of equal value in order to not have to repay the tax break. This brings added complications when, as in their case, they moved to a less expensive market and therefore had to buy an oversized house with its attendant oversized heating and AC bills with consequent environmental impact!