Chances are, at some point in your life—maybe even now—you’ve had a cell phone contract. And eventually, that contract ended. Maybe you just stayed on with your cell phone provider at whatever terms they were offering. But if you’re in the habit of getting the most out of your money, you probably tried to get a better deal from them before you renewed. Odds are good you also called up their competitors to see if a better offer was available.
Of course, consumers don’t just try to get the best deal on cell phone plans. Whether it’s clothes, concert tickets, or a new car, individuals are accustomed to testing the market to see if a better price is out there than the one advertised.
And yet, when it comes to GICs, many people just take the rate advertised by the bank. Much like taking the first offer from your cell phone company, this is a mistake. In many cases, it is, as the phrase goes, akin to “leaving money on the table.” When we’re talking about GICs, they’re often a critical component of one’s savings or retirement planning, so it literally pays to seek out the best return possible.
With this in mind, how can investors obtain the best possible rate on GICs?
First, and as alluded to above, don’t be afraid to negotiate, either over the phone or in person at a branch. While it may be disappointing if the bank won’t budge, you can still get the published rate, so you really have nothing to lose.
Best-case scenario, the bank may offer you a higher interest rate in order to win your business. They may be particularly inclined to do so if you’ve either been a long-term customer or have a lot to invest.
Second, make sure you check out the GIC rates at other financial institutions (and especially those of smaller or online banks). These can be taken advantage of if your bank won’t budge. Alternatively, a better offer from a rival bank can be used as leverage when negotiating with your existing one.
Third, check out some deposit brokers. As we’ve explained previously, deposit brokers can get better rates for individuals because they deal directly with banks. By offering the banks larger pools of money and cutting down on the banks’ marketing costs, deposit brokers can obtain better returns for clients’ GICs.
Fourth, make sure to check out Ratehub.ca’s page on GIC rates. We’ve done the legwork in finding the most competitive rates so you don’t have to. Whether you’re looking for a short-term cashable GIC or a longer-term, non-redeemable one, we’ve got you covered.