By 2 Cents on September 19th, 2011 | Category: Saving |  Starting today, there’s a new financial resource for Canadians out there. It’s called Finizi. Basically, Finizi is a free online service that allows financial institutions to compete for your business. At this time they are only offering GICs, but there are plans in the works to offer competitive bidding on rates for car loans and mortgages as well.
How It Works
Basically, you just need to go to finizi.com and:
1. Request a GIC rate
Select the type of GIC you want and specify the amount you’d like to invest.
2. Financial Institutions Bid for Your Money
Review your bids in a live auction environment. Financial institutions bidding for your business may include credit unions, trust companies or chartered banks. So far, they have about 5 institutions on board, but many have said that they would [...]
Read on and enjoy … Introducing Finizi: A New Financial Tool for Canadians
By 2 Cents on July 21st, 2011 | Category: Investing |  The conventional view serves to protect us from the painful job of thinking.
~J.K. Galbraith
A recent article in the Globe and Mail delivered the following advice to investors: Don’t Let a Fear of Bonds Infect Your Healthy Portfolio. The implications are clear:
1. Concerns about ultra-low interest rates eventually turning higher are overblown.
2. If you succumb to the paranoid people who think interest rates can actually rise above 0% – 3%, your portfolio will be unhealthy, damaged, infected. (The image with the article showed people in protective masks.)
3. And my personal favourite: Long term investors need not concern themselves with shorter term market movements because markets always rise over the long term – whenever that is.
So there you go. “Stop worrying so much about bonds.” All you have to do is put your desired allocation in bond mutual funds or [...]
Read on and enjoy … Yes, You Can Live Without Bonds
By 2 Cents on March 7th, 2011 | Category: Investing |  At high tide the fish eat ants; at low tide the ants eat fish.
~Thai Proverb
Stocks, bonds and cash are the three asset classes that most people consider to be the foundation of an investment portfolio, with stocks representing the most risky choice and cash, the least. Where do GICs fit into the mix? Some consider GICs (the Canadian version of U.S. CDs) to be part of your cash allocation. Others argue that many GICs don’t qualify as cash because you can’t always get instant access to your money. Some GICs are cashable, but you have to forfeit some or all of your interest earnings to get your money out.
In many ways, GICs are very similar to bonds. You invest your money for a fixed amount of time. You collect interest periodically throughout that period of time, and receive your [...]
Read on and enjoy … Are GICs a Good Substitute for Bonds?
By 2 Cents on October 13th, 2010 | Category: Saving |  To decide is to walk facing forward with nary a crick in your neck from looking back at the crossroads.
~ Betsy Cañas Garmon
Update: This article was included in the 279th Carnival of Personal Finance – 80s Music Edition posted at Dough Roller. Thanks!
I’ve received a couple of questions from readers on how exactly I have allocated our GIC portfolio. Previously, I’ve written about how set up a GIC ladder, but in reality the numbers don’t always work out as neatly as they do in the examples. The idea behind a GIC ladder is to diversify your interest rate exposure. You can do this by owning GICs with durations of 1-5 years or simply buying a new 5-year GIC each year and rolling money back into 5-year GICs as they mature.
The hope is that you can take the confusion [...]
Read on and enjoy … GIC Strategy: Two Important Questions
By 2 Cents on October 7th, 2010 | Category: Investing |  This is just a short post to let you know that discount brokerage Questrade is now offering commission-free GIC and bond trades. This issue came up during a discussion in the comments section of my 2010 Financial Plan Update for the third quarter. I’ve updated the comments with some of this information, but I just thought I would pass it along in case anyone else is interested.
Holding our sons’ RESP money in cash has been an issue for us for a while. It’s earning zero in a brokerage account, but I hesitated to buy a GIC because my brokerage (Questrade) charged about $30 for each purchase. It hardly seemed worth it with interest rates so low. Further, we may need some of that money within 3 years, and those rates are even lower than the 5-year rates. Unlike the GICs we have in our [...]
Read on and enjoy … Questrade Offering Bonds and GICs with No Commission
By 2 Cents on October 4th, 2010 | Category: Planning | Success is getting what you want; happiness is wanting what you get.
~Author Unknown
If you’re new to Balance Junkie, I outlined our annual financial plan for 2010 back in January. I update the plan each quarter so that readers can have an idea of how one family handles their finances. I don’t claim that the way we do it is the right way, but offer it as a sample for beginners who may not know where to start. I also use it as a way to make sure I actually review our finances every quarter!
Budgets and financial plans should be as unique as the lives that define them. Our life has included some very fortunate years followed by a recent period of tumult. Things have settled down and Mr. Cents likes his new job. Still, as I mentioned last quarter, we continue to worry [...]
Read on and enjoy … 2010 Financial Plan: Q3 Update
By 2 Cents on June 7th, 2010 | Category: Investing | In the old days a man who saved money was a miser; nowadays he’s a wonder.
~ Author Unknown
Update: This article is featured in the Carnival of Personal Finance #261 posted at Pop Economics. Thank you Pop!
Apparently the May stock market swoon spooked Canadian investors as they withdrew more than $1 billion from mutual funds in May. Investors seeking the safety of cash might normally move money from equity funds into money market funds. That’s not necessarily the case anymore, and for good reason.
If you have your money with an advisor who sells mutual funds, chances are moving your money into money market mutual funds is the fastest and easiest way to reduce your market exposure. But is it the best way? What are the alternatives?
By 2 Cents on April 9th, 2010 | Category: Saving | If you don’t like something, change it; if you can’t change it, change the way you think about it.
~ Mary Engelbreit
Update: This post is featured in the Money Hackers Carnival #111 posted at Deliver Away Debt. Thank you!
I recently wrote about How to Ladder GICs. That post lead to number of general questions about GICs, so I thought I would provide some information for you here. Although GICs are among the safest and simplest investments out there, there are enough options surrounding them to make choosing one almost as confusing as choosing other types of investments.
Why Invest in GICs?
Guaranteed Investment Certificates can offer investors a safe place to invest a portion of their capital. Depending on the length and features of the GIC you purchase, they can [...]
Read on and enjoy … GIC Primer: Frequently Asked Questions
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