Fixed Income Investments

Once the mainstay of Canadian savers, Canada Savings Bonds (CSBs) and Guaranteed Investment Certificates (GICs) are still effective investment vehicles for short-term cash needs, safety and liquidity.

CSBs are interest-bearing Government of Canada securities that are sold through most Canadian financial institutions in October of each year. They are available with regular or compound interest guaranteed for one or more years with denominations ranging from $100 to $10,000. In 1995, the government introduced a new RRSP option that allows investors to register their Canada Savings Bonds (Series 50) directly in the form of a Registered Retirement Savings Plan, without needing a self-directed plan.

GICs are securities issued by financial institutions, such as banks, trust companies, credit unions and life insurance companies. The rate of interest is guaranteed and they are available for specified terms. GICs of up to five years issued by members of the Canadian Deposit Insurance Corporation (CDIC) or the applicable provincial credit union deposit guarantee corporation are covered by deposit insurance up to $60,000.