Your ScotiaMcLeod account can hold a wide variety of
Guaranteed investments. The table below describes some of their
attributes, or contact us
for specific recommendations or to add these investments to your account.
As a rough rule of thumb, you should hold your age as a
% of your overall asset allocation in guaranteed investments, but that
will vary with your own risk tolerance.
| Guaranteed Maturity Amount and Date |
Yes |
Yes |
Yes |
No, Bond ETF values and returns fluctuate and are not guaranteed |
No, Bond fund values and returns fluctuate and are not guaranteed |
| Ability To Sell |
Yes, at market value |
Yes, at market value (see example .pdf 6k) |
No |
Yes, at daily Net Asset Value |
Yes, at daily Net Asset Value |
| Guaranteed By |
Issuer, generally Canada or the Major Provinces, unlimited guarantee
(corporate bonds not generally recommended due to lack of diversification) |
Issuer, generally Canada or the Major Provinces, unlimited guarantee
(corporate bonds not generally recommended due to lack of diversification) |
CDIC To $100,000 Per Issuer (can be up to $600,000 in Self-directed RSP) |
Not guaranteed |
Not guaranteed Corporate (High Yield) Bond funds at least have benefit of
diversification |
| Minimum Investment |
Generally $10,000 |
$5,000 of Maturity Value, can be as little as $2,000 of initial investment value |
$500 |
Roughly $5,000 to be cost effective |
$50 in payroll plans |
| RSP Eligible |
Yes |
Yes, Highly
recommended - ladder maturities for best results |
Yes |
Yes |
Yes |
| Tax Comments (Non RSP) |
Interest paid semi-annually, and taxable each year, try to buy at a discount,
to enhance after tax yield (need to reinvest if not using interest paid out) |
Interest paid all at maturity, but taxable each year. Not recommended
for taxable accounts due to unfunded tax liability |
Annual interest GICs recommended in taxable accounts |
Complicated |
Interest calculated by fund manager and taxable each year |
| Transferable? |
Yes to another self-directed RSP or investment account |
Yes to another self-directed RSP or investment account |
No, only upon maturity |
Yes to another self-directed RSP or investment account |
Yes to another self-directed RSP or investment account |
| Fees (Commission) |
Built into yield (very cost effective) |
Built into yield (very cost effective) |
Built into yield (very cost effective) |
Same commission as buying a stock (expensive) |
MERs generally 1% to 2% a year (expensive)* |
*While we generally don't like the management fees on bond funds, there are some reasons to consider funds over direct bond ownership under certain circumstances, and AIC has consolidated those reasons into one document (see "Bonds vs. bond funds").
