A friend asked me what BMO InvestorLine was offering for GIC rates currently as they tried to decide whether to switch brokerages. Since I pulled the numbers for her, I might as well share them with you, too. Rates can change every day, and even within a day. These are the GIC rates as of April 16, 2013.
Remember
- these GICs can NOT be cashed before maturity
- the minimum purchase size is $5000
- upon maturing, the principal and interest are paid back into the cash account part of your BMO InvestorLine account
- these GICs do not rollover and re-invest
| Issuer | Term and Interest Payment | Rate |
| Equitable Trust | 1 year | 1.8% |
| Home Trust | 1 year | 1.8% |
| Home Trust | 2 year, annual payments | 2.05% |
| Equitable Trust | 2 year, annual payments | 1.95% |
| Home Trust | 2 year, compound interest | 2.05% |
| Home Trust | 3 year, annual payments | 2.1% |
| Equitable Trust | 3 year, compound interest | 2.1% |
| Equitable Trust | 4 year, annual payments | 2.15% |
| Home Trust | 4 year, compound interest | 2.15% |
| Canadian Tire Bank | 5 year, annual payments | 2.35% |
| Canadian Tire Bank | 5 year, compound interest | 2.35% |
I found it a bit interesting that they are offering no incentive for compound versus annual interest payments in the longer term GICs. (For those who don’t know what that means, an annual payment GIC will pay you the interest each year so you can use it or re-invest it elsewhere. It never pays interest on interest. A compound interest GIC does not pay you any of the interest until the end of the entire term. It pays interest on the interest earned in previous years.)
Remember in a non-registered account, you have to claim and pay tax on the interest earned each year, whether it was physically paid to you or not. (In TFSAs, RRSPs, RESPS, RRIFs, RDSPs you do not have to claim the interest because you do not have to pay taxes until you withdraw the money from your registered account.)
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