Both GICs and real estate have continued to be the best investment for your money here in Calgary. Both of these investment opportunities pretty much guarantee a steady rate of return on the money you invest into them. While the numbers are not going to be mind-blowing with GICs, they are the most secure and stable way to make sure that your money is safe for the long-term. With residential real estate investments, you can also expect your money to grow at least at the same rate of inflation, if not more.
Laddering your GICs
The best way to get the most out of a long-term GIC investment portfolio is to ladder it. This means to put it into different GICs with various term lengths.
For example, if you have $20,000 to invest you could section it into 4 parts and invest the money the following way:
- 1-year GIC - $5000
- 2-year GIC - $5000
- 3-year GIC - $5000
- 4-year GIC - $5000
By doing it this way you get added security on your investment. Should rates rise in a year or two you'll be able to take advantage of the higher rates by investing the money back into GICs. On the other hand, if they remain the same or should they even go down, you are still making progress with your longer-term GICs that were locked in with a higher rate of interest.
Owning a home while investing your money
The best financial plan that you can put together is to continue to make mortgage payments on your home while investing the extra wisely. While you are building up the equity on your home and putting some money away in GICs, you'll be doubling your efforts and as a long-term plan you'll end up seeing more money in your pocket for your retirement.