Tangerine and EQ Bank are indeed two prominent neobanks in Canada, offering various financial products and services. Neobanks, also known as digital banks, operate exclusively online without physical branches, allowing them to offer competitive rates and lower fees to customers. In this article, we’ll compare their GIC (Guaranteed Investment Certificate) rates and discuss how GICs can fit into your investment strategy.
Tangerine offers a diverse range of fixed-income investment options, with durations ranging from 90 days to 5 years. Here are the available GICs and their respective rates:
This standard GIC from Tangerine can be purchased in any registered or non-registered account. It provides a high guaranteed interest rate with no service fees or charges. For instance, a $5,000 investment in a one-year GIC would yield $262.50 in interest, and you receive the initial principal of $5,000 at the end of the term.r54rtr4t
Tangerine offers RSP GICs for long-term retirement planning, providing tax benefits and the option to split income with a spouse.
Tangerine’s Tax-Free GICs allow savvy Canadian investors to maximize their annual contribution limit in their Tax-Free Savings Account. Any interest earned is tax-free.
For retirees over the age of 71, Tangerine offers RIF GICs, suitable for earning a steady income while preserving wealth.
Canadian investors can invest in US assets with Tangerine’s US Dollar GIC, earning a guaranteed return on US dollars.
Here are the interest rates for Tangerine’s GICs:
Tangerine’s GIC rates are influenced by the Bank of Canada’s overnight interest rate, and they have recently reached their highest levels since their introduction in May 2017.
EQ Bank offers its own selection of GICs for Canadian investors, with options for both registered and non-registered accounts. Here are EQ Bank’s GIC offerings and their corresponding rates:
Available for purchase in non-registered accounts with terms ranging from 3 months to 10 years.
Similar to Tangerine’s RSP GIC, EQ Bank’s registered GICs offer tax benefits and tax-free earnings upon withdrawal.
These GICs can be purchased in a Tax-Free Savings Account, offering tax-free interest earnings.
These GICs can be purchased in a Tax-Free Savings Account, offering tax-free interest earnings.
Here are the interest rates for EQ Bank’s GICs:
Like Tangerine, EQ Bank’s GIC rates are influenced by the Bank of Canada’s overnight rate and have recently reached their highest levels due to the bank’s rate-hike cycle to combat inflation.
In this comparison of Tangerine and EQ Bank’s GIC rates, EQ Bank appears to have slightly higher interest rates for GICs, particularly for 1-year terms. However, Tangerine offers a variety of GIC options, including RSP, TFSA, and US Dollar GICs, which may suit different investor needs.
For existing Tangerine customers, switching banks may not be necessary for a small interest rate difference, but new clients may find EQ Bank’s rates appealing. Both banks are reputable, offer a wide range of financial products, and are considered safe for Canadian customers.
In summary, the choice between Tangerine and EQ Bank ultimately depends on your specific financial goals and preferences, as well as the type of GICs and terms that align with your investment strategy.
