Season’s Greetings to One and All
Snow has begun falling once again. And it’s time to begin preparing for the arrival of another holiday season and the end of another year. I want to start marking this festive season by wishing you and yours a Merry Christmas and Happy New Year, however you might choose to celebrate it. So many ways to bring joy to what might be just a cold and dreary winter.
This year we are forced to make decisions about party planning and gift-giving in an economic climate gripped by high inflation and corresponding interest rates. The increased cost of everything makes each of us stop and think about our festive planning.
Budgets are either inflated, or the actual items purchased are cut back. Our love and joy haven’t diminished. But maybe the number of parcels under the tree has.
Throughout this last year, we have followed the headlines showing us the events that have triggered this round of inflation and interest rate hikes. Let’s hope that 2023 will show a way out of these troubling conditions and into a safe, calmer world.
As you stand in the supermarket trying to decide whether or not to buy that tray of butter tarts (oh, sorry, pick up more raisins and pecans because you plan to make them yourself - this year), you may be reflecting back on what all of it cost last year.
I’m with you. Inflation is not pleasant, and its reflection in the cost of everyday items and occasional treats is frustrating. But at the same time, depending on your circumstances, this may also be time to re-evaluate your portfolio.
With the rise in interest rates, you may have noticed an equivalent rise in rates for GICs and term deposits.
It’s been a while since GICs (Guaranteed Investment Certificates) were worth investigating. The extremely low rate of return took them off the table as viable investment tools for many of us.
But in today’s investment climate, these fixed-income tools take on a new charm. As we watch real estate fishtail, stocks remain uncertain, and cryptocurrency enters a new era of uncertainty, it’s nice for us to be able to consider things with some certainty in them.
This is where GICs come in. GICs offer certainty. They’re Guaranteed. But in an economic setting with low-interest rates, those guarantees aren’t exactly inspiring. As the guaranteed rates rise, so does their allure.
But with those guarantees come limits. When you purchase a GIC, you tie up your money for however long that GIC lasts. And these GICs can have maturation dates (the date the certificate comes due) of either months or years. You just need to be certain that you are not going to need that money before its maturation date. If you can set it aside for that long, then it can be a great way to see your money grow in a context that lets you sleep at night.
So in between glasses of eggnog and kisses under the mistletoe, go ahead and give me a call. I can help you figure out whether GICs are right for you. Give me a call at (519) 279-0186 or drop me a line at [email protected]. Let’s get your New year off to a safe and happy start.
And just let me close by repeating my wish for you to have a Merry Christmas and a Happy and prosperous New Year. And if those are not the holidays you celebrate – please enjoy the festivities that are right for you. Just be sure to stay safe and warm in the days to come.
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