Market-linked guaranteed investment certificates are promoted by sellers as offering the best of both worlds: the guaranteed income and lack of risk standard in a GIC plus the promise of more earnings should the stock markets perform well. Interest rates are lower than regular GICs, though, and unlike with stocks, your principal is locked in for an entire term.
The downside that comes with that, though, is that the money is usually locked in, meaning it’s not liquid – you can’t take it out if you need it without paying a penalty. Not having access to the money The danger of auto-renewals lies in forgetting about your maturing GIC. Imagine having a five-year GIC auto-renewed a year ago for five years, just as it started to become clear that rates were headed higher as a result of stubborn inflation. A one-year term would have been a good call.
Way better than listening to the crypto guy.
GIC’s can be beneficial but can’t be considered investments