UPDATE: This article is historical, from 2013. I no longer invest with RBC Direct Investing.

We keep some of our hard-earned savings in guaranteed investment certificates. It’s true that right now the interest rates offered for them are abysmal. However, they give us a solid base for our portfolio that won’t evaporate during a market meltdown. We need that sense of security. So when I opened a RRSP account at RBC Direct Investing, I checked out how to buy a GIC in this new brokerage account.

Does RBC Direct Investing Offer a Reasonable Selection of GICs for No Fee?

Yes.

In fact, RBC Direct Investing offers GICs from some of the same financial institutions that offer the best annual rates at BMO InvestorLine. (CIBC Investor’s Edge often does not offer a GIC at the highest rate that you can get from InvestorLine or Direct Investing. They should consider fixing that!) In all, RBC Direct Investing offers GICs sold by about 20 financial institutions.

I also double-checked. I do not have to pay a fee or commission to purchase a GIC from RBC Direct Investing.

Buying a GIC from RBC Direct Investing

1. Go to the RBC Direct Investing website.
   1. Click on the Sign In button.
   2. In the Client Card Number: field, type your card number.
   3. In the Password: field, type in your password.
   4. Click on the Sign in button.
2. Click on the Trade tab.
3. From the list of links across the top of the Trade tabbed page, click on Fixed Income.
   The highest rate for GICs with 1- to 5-year-terms will be shown as a link. The table of links displays the best rate for Compound interest, Annual Interest, Semi-Annual interest, Quarterly interest and Monthly interest.The minimum purchase required for a Registered Account is $3,500.
   The Minimum purchase required for a Non-registered Account depends on the term: It is $20,000 for a 1-year term; but drops to $15,000 for 2; $10,000 for 3, $5,000 for 4, and $3500 for 5 years.You can also perform a search for GICs using the Fixed Income Search table.
4. I just clicked the interest rate link to select an Annual pay, 1-year term certificate for today’s test.
5. The Fixed Income Search screen opens.
   To see the best offered interest rate, I clicked on the light grey downward-pointing arrowhead beside Interest Rate in the table of results. When you hover over this arrowhead, the message says “Sort on this column in descending order.”Eeeww. Bug!
   Instead of re-sorting the table, it opened the Fixed Income Search box again with no data selected. It has not even got the GICs radio button selected.Doggedly, I use the browser back button and try again. Same thing happens. And again.
6. So I decide to fill in the Fixed Income Search box again. So I:
   1. Click to select the radio button for: GICs
   2. From the Type drop-down list, select: Annual
   3. For the Maturity, from the drop-down list, select: 1 yr
   4. And click the Find button.
7. And it just gets me back where I was with the GICs still not sorted by highest rate to lowest!
   THIS time, though, when I click on the downward arrowhead beside Interest Rate, it sorts the table properly. Interesting!
8. To check this again,
   I left the Fixed Income screens entirely by clicking on my Home tab.
   Then started over again. I clicked on the Trade tab and etc.
   The bug repeated.It seems it will only allow me to use that downward-pointing arrowhead to sort the table of GICs by rate if I run a customized fixed income search first.I checked that it sorts properly if you do a customized search right from the beginning. To do so, I:
   1. Clicked on the Trade tab.
   2. From the list of links across the top of the screen, clicked on Fixed Income
   3. Instead of picking the highest listed interest rate for the certificate I wanted on the first screen, I completed a Fixed Income Search:
   4. Click to select the radio button for: GICs
   5. From the Type drop-down list, select: Annual
   6. For the Maturity, from the drop-down list, select: 1 yr
   7. And click the Find button.
   8. From the resulting table, I can immediately click to sort by descending interest rate.

Why am I bothering with trying to sort the table by descending interest rate?

• To avoid missing a higher interest rate when scanning down the table. I could have mistaken or forgotten the highest rate I saw on the first screen.
• To see which companies are offering the best rate. Often there may be 2 or 3 financial institutions offering the same highest rate. I might prefer one company over another, especially if I am at the CDIC maximum insurable $100,000 limit for one institution but not for another.

So now I finally know from which institution I want to buy my GIC.

To Buy the GIC at RBC Direct Investing

1. From the Fixed Income Advanced Search Results table sorted by Interest Rate in descending order:
   Click on the linked name of the financial institution offering the GIC.
2. A “Financial Institution’s Name” Buy screen will open. For example, the screen may be titled: Equitable Trust.
   Review the
   • security type (GIC),
   • payment frequency (annual),
   • maturity date (today’s date plus one year), and
   • Interest Rate (should be the high one you’re looking for)

   If they are all ok,
   Click on the Buy button

   Which was a bit unnerving as I had not entered how large of a certificate to buy!
   Ah. That’s because I’m not done.

3. Review the info again. Then:
   • From the Account #: drop-down list, select which account to fund the purchase.
     For RRSPs be careful to select the CAD account, not the USD one, if so desired.
   • In the PAR Value of Purchase: field, type the cost of the certificate you want to purchase. For a RRSP account, the minimum purchase is $3500.
   • In the Contact Phone field, type your phone number.

   Click on the Continue button.

4. If you tried to trick it, like me, it will reply:
   “The minimum Par Value for purchasing a GIC is $3,500. Please see the Fixed Income Order FAQ for more details before trying again.”If you put in the proper amount, it will take you to the Confirm Transaction Step 2 of 3 screen.
   Review the “Important Notice” and the details of your purchase.
   If it all looks ok, click on the Confirm button.
5. The Transaction Complete Step 3 of 3 screen will be displayed.
   Make note of your Order ID number by writing it down, or by copying the entire order confirmation and terms into a document and saving it.
6. To check what’s been updated:
   • Click on the My Portfolios tab.
   • Check your Available Funds.
     Interesting. So far it has not removed the $3,500 from my available cash even though it says this is my “available cash as of the time it actually is now.”
   • Under the list of links for the My Portfolios tab, click on the Order Status link.
     There’s the order. All is as expected. The Status Action is “Pending.”
   • So I guess I’ll just have to make a note to not spend that $3,500 while waiting for them to drop my Available balance.
7. Click on the Sign Out button.
   For added security clear your browser cache and close your browser session.

How Did the Purchase Compare to Buying a GIC at InvestorLine or Investor’s Edge?

BMO InvestorLine automatically sorts its table of GIC offers from the highest to lowest interest rate. That seems sensible. It does mean that the BMO GIC product offerings are not at the top of the list.

Investor’s Edge makes you sort the list of GICs you can buy, like RBC Direct Investing does.

On the possible plus side, RBC Direct Investing lets me buy a smaller GIC in a registered account, with a $3500 minimum versus $5000 at InvestorLine and Investor’s Edge.

It’s easiest to buy a GIC at InvestorLine. It takes more steps at RBC Direct Investing, even if it didn’t have any programming bugs.

It’s most profitable to buy a GIC at InvestorLine or RBC Direct Investing as they offer GICs from financial institutions with better rates than those at Investor’s Edge.

Given that InvestorLine sorts the rates for me and requires fewer screens to make a purchase while still offering the same high rates as RBC Direct Investing, I’d say InvestorLine is slightly better for purchasing GICs.

Related Reading

• How to Buy a GIC at CIBC Investor’s Edge
• How to Buy a GIC at BMO InvestorLine

Join In
Have you encountered any computer hiccups when buying GICs at your online brokerage? Did you ever really screw up and buy one of those very-low-rate GICs offered directly by your own Big 5 bank within your self-directed brokerage account? (I’m just wondering if they ever truly catch anyone by putting their own products at the top of the list.) Please share your experiences with a comment.