EQ Bank GIC Review 2020: Your High-Interest Online Bank

EQ Bank GIC Review
Updated: May 30, 2020

Are you tired of putting your funds into savings tools that don’t offer you returns that you’d like? 

Guaranteed Income Certificates (GICs)  and other savings methods have long been an ineffective way for Canadians to capitalize on returns from their savings, especially if it’s at one of the Big Five Banks.

The low-interest environment cannot keep up with the inflation rates, making investments like GICs relatively useless.

Online banks have recently been introducing high-interest rates on their GIC products that can help you take genuine advantage of your savings to accumulate substantial money.

I’ve come across several of them, and the EQ Bank GIC caught my attention due to its high rates. I have experience in using GICs, and I found the EQ Bank GIC close to being something I would like to use.

Hopefully, my EQ Bank GIC review will give you the information you need to decide whether this GIC is suitable.

According to the Canadian Bankers Association, more than 75% of Canadians use online and mobile banking for most of their transactions.

When Should You Buy a GIC?

While GICs are not the most exciting investment option, they do guarantee all your money back and the interest for the duration of your investment. Before we take a deeper look at the EQ Bank GIC in the review, I am going to discuss some of the reasons that can help you decide when to invest in a GIC. 

  1. If you have a short-term investment horizon: GICs are ideal if you want to park your money in a safe place for a few years and want some return on your investment.
  2. You don’t want any risks to your capital: Since the key term is guaranteed in GIC, you can rely on the fact that this is a safe investment.
  3. You want some of your capital dedicated to fixed income: Like bonds, GICs can be considered fixed-income investments. It can help you earn a fixed amount of money without risk, volatility, or complications affecting the passive income.
  4. If you want to park your funds so you cannot spend it: Putting your cash into a GIC makes your funds harder to access as opposed to a high-interest savings account.
  5. You want cash available for stock market opportunities: GICs guarantee safety for your funds and increase it over time. You can use the returns from GICs to invest in stocks that are currently too expensive.
  6. You have retired and will need savings to boost retirement funds: GICs set for a longer-term can provide you substantial returns by the time you retire. It can give a significant boost to your overall retirement funds when it matures, and you can liquidate it.

EQ Bank GIC Interest Rates

In order to buy an EQ Bank GIC, you must first open an EQ Bank Savings Plus Account here.

The EQ Bank GIC rates are among the best in the industry. For instance, the EQ Bank GIC 3-month rate is 1.50% (As of June 5, 2020). I have cross-checked with several online banks and major banks and found that EQ Bank GIC rates have few that come close to their offer rates. In this part of my EQ Bank GIC review, I will take a look at the latest rates offered by the EQ Bank GICs.

Short-Term Non-Redeemable GICs

  • EQ Bank GIC 3-month rate: 1.50%
  • EQ Bank GIC 6-month rate: 1.60%
  • EQ Bank GIC 9-month rate: 1.60%

Long-Term Non-Redeemable GIC

  • EQ Bank GIC 1-year rate: 1.70%
  • EQ Bank GIC 5-year rate: 2.15%
  • EQ Bank GIC 10-year rate: 2.70%

Note that because the EQ Bank interest is so high for their High-Interest Savings Account (Currently at 2% per year), many Canadians choose to hold their money inside that instead of a GIC. This way, your money is not locked in like it is with a GIC and you still get a great interest rate. You can get that rate by opening a EQ Bank Savings Plus Account here.

How to Buy a EQ Bank GIC

  1. Open an EQ Bank Savings Plus Account here.
  2. Fund your account.
  3. Purchase a GIC with your funds.

EQ Bank GIC Alternatives

I think it is wise to take a better look at any alternative options before you decide on any investment option. While EQ Bank GIC rates are among the best in the market, I am going to discuss three alternatives that are worth consideration.

Tangerine Bank GIC

(Rates as of June 5, 2020)

Tangerine is another online bank that offers excellent interest rates on its GICs. Tangerine offers GIC terms ranging from three months to five years in length. Their rates range from 0.50% for the 3-month GIC to 1.80% for its 5-year GIC.

Simplii Financial GIC

(Rates as of June 5, 2020)

Simplii Financial is another online bank with GIC options that provides you with higher interest rates compared to the Big Six Banks. It offers you non-redeemable GICs with terms lasting from one year to five years. The bank’s GIC rates range from 1.60% for the 1-year GIC to 1.85% for the 5-year GIC.

Motive Financial GIC

(Rates as of June 5, 2020)

Another worthy mention for an online bank that offers you GICs at attractive interest rates is Motive Financial. It provides you non-redeemable GICs with terms lasting from 12 months to 60 months. The bank’s GIC rates range from 1.60% for its 12-month GIC to 2.150% for its 60-month GIC.

(Rates as of June 5, 2020)

EQ BankTangerine BankSimplii FinancialMotive Financial
1 Year GIC Rate1.70%1.60%1.50%1.60%
2 Year GIC Rate1.80%1.70%1.60%1.80%
3 Year GIC Rate1.00%1.75%1.65%1.90%

EQ Bank TFSA

EQ Bank does not currently have a dedicated TFSA account, so you can’t hold any GICs inside your TFSA with EQ Bank.

In order to purchase a GIC with EQ Bank, you must first open up a EQ Bank Savings Plus Account here.

Conclusion

EQ Bank GIC offers you a reliable option when it comes to storing your money for various short- and long-term savings goals. It can help you take care of several tasks, from saving money for a down payment or bolstering your retirement funds, and everything in between.

There is an increasing number of online banks offering high-interest GICs now. EQ Bank GIC rates happen to be attractive in both short- and long-term GICs.

EQ Bank GICs get the Wealth Awesome stamp of approval with two thumbs up. You can check out a more detailed review of the bank offering the GIC in my EQ Bank Review.

EQ Bank GIC Review
<a href="https://wealthawesome.com/author/christopher-liew/" target="_self">Christopher Liew, CFA</a>

Christopher Liew, CFA

Creator of Wealth Awesome

A Canadian CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

You may also like…

0 Comments

Submit a Comment

Your email address will not be published. Required fields are marked *

Join Thousands of Canadians

Subscribe here to my newsletter! I'll send out one email a month packed with interesting news about Canadian finance. It also comes with a free resource guide.

You have Successfully Subscribed!