Last Minute RRSP - Best GIC rates

As an alternative to money market mutual funds or bond funds, there is no reason you could not consider GICs for fixed income in a registered retirement savings plan (RRSP).  Guaranteed Investment Certificates are simple to understand, have no risk of losing principal, and best of all have no fees.  Here are some tables of what various banks, credit unions, and others are offering.

Ally (RBC) Rates March 2013

The "Would you like a pony?" people, formerly Ally Bank - and now Royal Bank of Canada (RBC), have grinded down their rates like a pony at the glue factory, and there is not left.  Remember the 2% savings rate?  Now you need a 4 year term to get to that level (see their chart at right).

The most reliable rates are from Achieva Financial - a credit union out of Winterpeg Manitscoldout (see chart below).  Acheiva's GIC rates have always been a shade higher than Ally and now they are clearly above - no more 2% savings rate anymore but you get close .. certainly these rates maintain most of your buying power after inflation.

Acheiva Rates March 2013

Search online for the best rates and you can't beat Achieva Financial for GIC rates.  These apply to any deposit size.

The chart to the bottom  right is from the GIC Wealth Management Inc. web site.  They are competitive with Acheiva's rates.  They also offer a 2.1% for a 15 month term - but that is with a $25,000 deposit.

For our RRSP top up this year we went to ICICI Bank for the first time.  They edge out all the others with a 3.15% 5 year GIC rate.  This applies to RRSP, RRIF, RESP or TFSA accounts from  ICICI Bank Canada. Like all CDIC deposits it is insured for up to $100,000.

Remember - if you are in a high tax bracket now, and may be in a lower on when you retire (e.g., invest this GIC into a spousal account), you get back more in the RRSP tax refund than you will in over 10 years of  GIC returns.  Considering that, there is not a big difference in a fraction of a percentage in GIC return.  Consider sticking with one institution to keep filing simplified and save some time.