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Difference between Term Deposit and Gic

Difference between Term Deposit and Gic

There is a big difference between a term deposit and GIC. A term deposit is a loan that can be cashed in before the end of the agreed-upon time period, while a GIC is an investment that cannot be cashed in until the end of the agreed-upon time period.

What is a Term Deposit?

A term deposit, also commonly referred to as a fixed deposit, is a special type of investment product offered by banks and other financial institutions. Term deposits allow investors to deposit a certain amount of money for a fixed period of time at a pre-determined interest rate. At the end of this time period, the original principal can be withdrawn along with any accrued interest. Term deposits are typically held by individuals or businesses that are looking for a low-risk investment option with guaranteed returns. Because they are such a low-risk investment, term deposits are often seen as an ideal choice for long-term savings or retirement planning. Overall, a term deposit is an important tool in helping individual investors achieve their financial goals.

What is Gic?

Gic is a type of investment vehicle that allows individuals to obtain short-term financing by selling their fixed income securities to another investor. Funded through the use of collateral, Gics are typically lower-risk investments than other types of loans, as they involve repackaging an individual’s assets and reselling them at a higher price. In addition, Gics often offer investors advantageous tax structures and a degree of liquidity that is not typically available with other types of investments. Overall, Gics represent a useful tool for those looking to access flexible financing options or manage their assets more effectively. Whether you are an individual investor or a professional financial manager, Gics can be an excellent choice for your investing needs.

Difference between Term Deposit and Gic

A Term Deposit is an investment where you agree to deposit money for a set period of time, usually between 30 days and 5 years. In return, you earn interest at a fixed rate set by the bank. When the term is up, you can withdraw your money plus the interest earned. A GIC is a guaranteed investment certificate. Like a Term Deposit, you agree to deposit money for a set period of time. The main difference is that with a GIC, you earn interest at a variable rate. This means that the interest rate can go up or down during the term. At the end of the term, you will get your original investment back plus any interest that has accrued. Term Deposits and GICs are both safe investments since they are backed by the Canadian government.


Although term deposits and GICs are both considered low-risk investment vehicles, there is a big difference between the two. In general, GICs offer a higher rate of return than term deposits do, but they also come with more risk. If you’re looking for a safe investment with minimal risk, then a term deposit may be the right choice for you. However, if you’re willing to take on a bit more risk in order to potentially earn a higher return, then go with a GIC. Whichever option you choose, make sure to do your research so that you can find the best product for your needs.

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