Guaranteed Investment Certificates (GICs) are one of the safest savings options available to Canadians. They offer a fixed rate of return over a set term, with no risk of losing your principal. In 2026, 1-year GIC rates at competitive institutions are ranging from 3.90% to 4.15% — far ahead of the 0.01–0.10% most big banks pay on regular savings accounts.
This guide covers the current best rates, explains the different GIC types, walks through how to shop effectively, and shows you how to hold GICs inside registered accounts like a TFSA or RRSP to maximize your after-tax return.
What is a GIC?
A Guaranteed Investment Certificate is a deposit product where you lend money to a financial institution for a fixed term — anywhere from 30 days to 5 years — in exchange for a guaranteed interest rate. At the end of the term (maturity), you receive your principal back plus the earned interest.
Unlike stocks, bonds, or ETFs, GICs do not fluctuate in value. Your return is locked in at the time of purchase. This makes them useful for savings you want to protect from market volatility — emergency funds, a down payment, a future purchase, or a conservative allocation within a larger portfolio.
Best 1-year GIC rates in Canada (2026)
The 1-year term tends to offer the most competitive rates in Canada right now. Below are approximate rates from leading institutions. Rates are indicative — confirm directly before purchasing.
| Institution | Approx. 1-Year Rate | Insured By | Notes |
|---|---|---|---|
| EQ Bank | 4.00% | CDIC | No minimums, redeemable options available |
| Oaken Financial | 4.10% | CDIC | Home Bank (CDIC member), competitive across terms |
| Peoples Bank of Canada | 3.90% | CDIC | BC-based, available across Canada |
| Achieva Financial | 4.05% | DGCM | Manitoba credit union, competitive on longer terms |
| Steinbach Credit Union | 4.15% | DGCM | Manitoba credit union, regularly competitive |
| Motusbank | 3.85% | CDIC | Meridian subsidiary, good for bundled accounts |
| Outlook Financial | 3.95% | DGCM | Manitoba credit union, simple online access |
Rates are approximate and for illustration only. Verify directly with each institution. Rates subject to change without notice.
GIC rates by term (2026 overview)
The relationship between term length and rate is not always straightforward. In a normal environment, longer terms would pay more. In 2026, 1-year GICs are often the sweet spot — they offer strong rates without locking money away for as long. Shorter terms sacrifice some yield; longer terms currently offer slightly less than 1-year rates at many institutions.
| Term | Typical Rate Range | Best Use Case |
|---|---|---|
| 90 days | 3.50% | Very short-term, lower rate, good for near-term needs |
| 6 months | 3.75% | Good bridge between HISA and longer lock-in |
| 1 year | 4.00–4.15% | Most competitive rates right now in Canada |
| 2 years | 3.70–3.90% | Rate slightly lower than 1-year in current environment |
| 3 years | 3.60–3.80% | Useful for certainty; can be laddered with shorter terms |
| 5 years | 3.50–3.70% | Longest lock-in; best for money you will not need soon |
Types of GICs: what you need to know
Not all GICs work the same way. The rate, flexibility, and best use case vary significantly by type. Make sure you understand what you are buying before locking in.
Non-redeemable GIC
You cannot access funds until maturity. Usually offers the highest rates. Best when you have certainty about timing.
Best for: Emergency fund overflow, known future expenses
Redeemable GIC
You can cash out early, often with a lower rate or penalty. More flexibility, but you usually give up 0.25–0.75% in rate.
Best for: Uncertain timelines, bridge savings
Cashable GIC
Typically cashable after 30–90 days with no penalty. A hybrid between HISA and locked-in GIC. Often offered by banks.
Best for: Short-term parking with more stability than a HISA
Market-linked GIC
Returns are tied to a market index. Principal is protected but gains depend on index performance. Read the terms carefully.
Best for: Conservative investors who want potential upside without risk of loss
CDIC vs DGCM: is your GIC protected?
This is one of the most misunderstood aspects of Canadian GICs. Deposit insurance depends on which type of institution holds your money:
- CDIC (Canada Deposit Insurance Corporation): Covers deposits at federally regulated banks and trust companies. Protects eligible deposits up to $100,000 per depositor, per insured category (e.g., $100,000 in registered accounts, $100,000 in non-registered, $100,000 in joint accounts). GICs with original terms of 5 years or less at CDIC members are covered.
- DGCM (Deposit Guarantee Corporation of Manitoba) and other provincial systems: Credit unions are regulated provincially. Most provincial deposit guarantee corporations offer unlimited coverage on deposits. DGCM, for example, covers 100% of eligible deposits with no cap. Coverage rules vary by province — always check the specific provincial guarantee corporation.
Neither system covers GICs at unregulated entities, mutual fund companies, or investment dealers. Stick with CDIC members or provincially regulated credit unions with deposit protection for safety.
Where to hold your GIC: TFSA, RRSP, or non-registered?
The location of your GIC matters almost as much as the rate. GIC interest is fully taxable as income in a non-registered account — not at the favourable capital gains rate, and not with any dividend credit. This makes account placement a meaningful decision.
- TFSA GIC: Interest earned is completely tax-free. You do not report it as income, it does not affect benefits, and the room comes back the following calendar year when you withdraw. This is generally the best location for GIC interest if you have available TFSA room.
- RRSP GIC: Interest is sheltered inside the registered account and only taxed when you withdraw. Useful if you want conservative fixed-income exposure inside your RRSP, especially as you approach or enter retirement.
- Non-registered GIC: Interest is added to your taxable income in the year it is earned (or accrued annually for multi-year GICs, even before maturity). If you are already in a high tax bracket, this significantly reduces your after-tax return.
Example: Tax impact of GIC placement
A $20,000 GIC at 4.00% earns $800 in interest. In a TFSA, you keep all $800. In a non-registered account at a 43% combined marginal rate, you keep about $456. Over 5 years of compounding, the TFSA difference is substantial — over $1,800 more in after-tax wealth just from account placement.
How to build a GIC ladder
A GIC ladder is a strategy where you split your savings across multiple GIC terms so that one GIC matures every year (or every quarter, depending on how you build it). This gives you access to a portion of your money regularly while still capturing better rates than a standard savings account.
A simple 5-year ladder example with $50,000:
- $10,000 in a 1-year GIC at ~4.10%
- $10,000 in a 2-year GIC at ~3.80%
- $10,000 in a 3-year GIC at ~3.70%
- $10,000 in a 4-year GIC at ~3.65%
- $10,000 in a 5-year GIC at ~3.60%
Each year, the maturing GIC is reinvested into a new 5-year GIC. Over time, all of your GICs converge to 5-year terms (which tend to offer higher rates than shorter terms in a normal yield environment), but you always have a portion maturing annually if you need access.
This strategy is especially useful for conservative savers who want predictable income without tying up all their money at once. It also protects against rate risk — if rates drop, you are not rolling everything into a lower rate at the same time.
GIC vs HISA: which is better?
Both are safe, low-risk places to hold savings. The decision comes down to flexibility vs. return:
- Choose a HISA if you might need the money soon, if it is your emergency fund, or if you want to take advantage of future rate increases (HISA rates float with the Bank of Canada rate).
- Choose a GIC if you know you will not need the money for 1–5 years, if you want rate certainty, or if you believe rates will fall and want to lock in the current rate before that happens.
Many Canadians hold both: a HISA for the emergency fund and liquid savings, and a GIC ladder for medium-term savings they want to earn more on without market exposure.
How to buy a GIC in Canada
Purchasing a GIC is straightforward:
- At your bank or credit union: Log in to your online banking or visit a branch. Most major banks and many credit unions offer GICs through their platforms. Compare rates — major bank rates are often not competitive.
- Through a GIC broker or deposit broker: Brokers like EQ Bank, Oaken, and others offer competitive rates directly online. Some independent deposit brokers compare rates across multiple institutions and let you purchase in one place.
- Through your investment account: If you have a self-directed TFSA or RRSP with a brokerage, you can often purchase GICs directly inside the account. Some discount brokers like Questrade offer GIC marketplaces.
When comparing, look beyond just the headline rate. Check whether interest is paid annually or at maturity (which affects compounding), whether the GIC is redeemable or non-redeemable, and whether the institution is CDIC-insured or covered by a provincial deposit protection scheme.
What to watch out for
- Promotional or teaser rates: Some institutions offer short-term promotional rates to attract new customers. Read the fine print — the rate may apply only for the first 30 or 60 days, then revert.
- Automatic rollover terms: If you do not provide instructions at maturity, some GICs automatically roll into a new term, often at a lower rate. Set a reminder before your GIC matures.
- Annual accrual on multi-year GICs: If you hold a 3-year GIC outside a registered account, CRA requires you to report interest annually, even if it is not paid out until maturity. Plan for the tax impact each year.
- Contribution room for registered GICs: Placing a GIC inside a TFSA or RRSP uses your registered contribution room. Make sure you have sufficient room before purchasing inside a registered account.
Project your GIC returns
The GIC calculator lets you enter your deposit amount, rate, and term to see the maturity value and total interest earned. You can also use the TFSA calculator to project how GIC interest compounds over time inside a tax-free account.
Frequently asked questions
Can I lose money on a GIC?
Not on the principal, if the institution is CDIC-insured or covered by a provincial deposit guarantee and you stay within the coverage limits. Your principal is guaranteed regardless of what happens in the market. Market-linked GICs protect your principal but may return 0% interest if the index performs poorly.
Are GIC rates going to go up or down in 2026?
GIC rates are influenced by the Bank of Canada overnight rate and the broader bond market. We do not forecast rates — no one can do so reliably. If you believe rates will fall, locking in a current rate with a longer GIC term can be advantageous. If you believe rates will rise, shorter terms or cashable GICs preserve flexibility.
What happens if a GIC matures and I do nothing?
Most institutions will automatically roll your GIC into the same term at the current rate, which may be lower or higher than your original rate. Always check the maturity instructions for your specific GIC and set a calendar reminder before the maturity date.
Can I hold a GIC inside a FHSA?
Yes. GICs can generally be held inside a First Home Savings Account (FHSA), similar to TFSA and RRSP. Interest earned is tax-sheltered, and qualifying withdrawals for a first home purchase are tax-free. Check with your institution to confirm which GIC products are eligible for FHSA accounts.
How this page was prepared
Last updated: April 2, 2026
Rates shown are based on publicly available information from institution websites and are approximate. This article is for educational purposes and is not financial advice.
Assumptions
- GIC rates listed are approximate 1-year non-redeemable rates for new deposits. Rates are subject to change.
- Term comparison rates are market estimates based on observed institutional offerings and may not reflect any specific institution.
- CDIC coverage rules reflect 2026 published limits. Always verify current coverage with CDIC directly.
- Provincial deposit guarantee coverage rules vary by province and institution type.
Sources and review
Self-reviewed by: Gourav Kumar
Checked against official Canadian source material where applicable; not reviewed by a licensed financial advisor, accountant, mortgage broker, or tax professional unless explicitly stated.
Educational estimate only. Verify important figures against your CRA account, lender, or tax slips before acting.
Disclaimer: GIC rates change frequently. Always verify current rates directly with the institution before making any financial decision. This page is for educational purposes only and does not constitute financial advice.