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[OP]
Deal Fanatic
Oct 7, 2007
8708 posts
4582 upvotes

GIC deposit brokers

I keep seeing different GIC deposit brokers advertising rates that appear to be relatively competitive to what one can get elsewhere but have always steered clear of such brokers.

Has anyone here had any experience with GIC deposit brokers?

Are there any risks in dealing with GIC deposit brokers?

Are there any deposit GIC brokers you could recommend over others?

Any information you can share that would be helpful would be most appreciated.

P.S. I realize that GICs are not everyone' investment vehicle of choice. My situation does not have much risk tolerance built-in, so this is why I am trying to research this more in our current environment of ultra-low interest rates.
6 replies
Deal Addict
User avatar
Jul 29, 2013
1432 posts
1084 upvotes
I think GIC deposit brokers offered a valuable service before the internet. Now anyone can find the rates online. Their service is redundant.

I used to use them years ago until RFD etc. had all the rates online. Stopped using them when I could match their rates myself.

Also many of the GIC offers were from smaller little known companies.
Deal Fanatic
Aug 5, 2006
6578 posts
3373 upvotes
Global Village
@profile is right, it is better if you have a direct relationship with the banks you buy GIC's from and cut out the middleman. I recommend you look at Oaken, EQ Bank, Meridian, they have shown to be aggressive with GIC rates in the past, you can open savings accounts with them, hold them until rates improve and pounce when you see them offering GIC rates you like. Each 1 notifies you of GIC rate changes in advance by email.
All day I dream about sports
Deal Fanatic
Apr 5, 2016
5509 posts
3932 upvotes
Calgary/Vancouver
Self directed brokerages basically killed GIC brokers. Get access to all the competing GICs and don't need to pay middleman a broker fee. Most self directed brokerages don't even make money on GICs, they just want the balance.
Deal Addict
User avatar
Jul 29, 2013
1432 posts
1084 upvotes
bomber17 wrote: Self directed brokerages basically killed GIC brokers. Get access to all the competing GICs and don't need to pay middleman a broker fee. Most self directed brokerages don't even make money on GICs, they just want the balance.
Personally, I find my self-directed brokerage (BMO) has pitiful GIC rates and I never use them as I get better rates elsewhere as Scoper mentioned.
[OP]
Deal Fanatic
Oct 7, 2007
8708 posts
4582 upvotes
profile wrote: Personally, I find my self-directed brokerage (BMO) has pitiful GIC rates and I never use them as I get better rates elsewhere as Scoper mentioned.
This is true.

The rates advertised on these websites look to be better in some cases than what is available anywhere else. Hence, the reason for my question.
https://gicsimple.ca/
https://gicwealth.ca/gics-rates/

But, I don't understand how these brokers work so I am a little bit leery of going down that path without consulting with others. :)
Deal Guru
User avatar
Sep 1, 2005
14327 posts
9092 upvotes
Markham
Nothing wrong with using a GIC Broker. They do the banking and the administration and a quick phone call, they can tell you what the best rate is for each term and who is offering it. They provide a service and it costs you nothing. They get a commission paid by the financial institution...you the customer do not pay anything.

They have access to a bunch of banks, trust companies some of whom do not have a bricks and mortar presence. You cannot access some of those institutions. FYI all of the institutions are CDIC insured.

Re. self directed brokerages, some brokers are true GIC brokers and some are not. An investment dealer may have access to these banks/trust companies [not all of them as some will not establish relationships with every bank/trust] and can buy GIC's for you but in many cases, the monies are deposited into a "nominee" account ie your name is not on the GIC and Tslips at year-end are not from the banks/trust companies they are from the dealer.

No risk if they are true licensed GIC Broker [RDBA = Registered Deposit Brokers Assocation]. FYI all cheques SHOULD BE MADE OUT TO THE BANK/TRUST whom you are depositing monies with. DO NOT MAKE CHEQUE PAYABLE TO THE BROKER...if you make a cheque to the brokerage (not the person), you're probably setting up a "nominee" relationship as mentioned above ie like a self directed brokerage.

If in doubt, start smaller. You can call the bank/trust company to confirm your deposit.

Re. those two links you provided...I don't know them myself but you can phone/contact RDBA to confirm who they are.
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