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DUCA, Prime-Linked GIC/RRSP/TFSA/RRIF
January 2, 2019
3:44 pm
jackie999
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Opinions on this product? I prefer everything in one place and since I don't plan on using my TFSA any time soon (AND I have no idea what interest rates are doing) this looks okay to me.
This way, with the 5 year it'll climb if rates go up and will be guaranteed a minimum.

******Rate rises automatically when the Prime Rate increases. Rate is guaranteed not to fall below 3.00% for the 5 year term, 2.90% for the 3 year term, and 2.45% for the 1 year term. Prime-Linked GIC is non-redeemable.

January 2, 2019
4:43 pm
Top It Up
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SO, if you're willing to take a pass on Meridian's 5-year 3.75% GIC you must believe that interest rates are heading north, no?

Personally I'm not that optimistic and I would take the 3.75% bird-in-hand rate. The DUCA offer is Prime - .95% which means the market would have to hit a Prime of 4.70% to match the Meridian offer - how confident are you that the market is headed there?

Remember, if the rates do go up, there's always NEXT years contribution to take advantage of that rate increase.

January 2, 2019
6:44 pm
Oscar
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Duca has a TFSA eligible 5 year GIC @3.75% so you can keep it all in one place either way
https://www.duca.com/rates/term-deposits/

January 2, 2019
8:51 pm
Loonie
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I support Top It Up's caution.
As a basic principle, I tend to avoid any "GIC" that has the word "Linked" attached to it, is referred to as a "Product" or requires any complicated guesswork or calculations.
A GIC should be a GIC, straightforward and clear, with a guaranteed rate of return. The more they mess with the basic formula, the less likely you are to win.

January 2, 2019
10:10 pm
Canadianbull
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Loonie said
I support Top It Up's caution.
As a basic principle, I tend to avoid any "GIC" that has the word "Linked" attached to it, is referred to as a "Product" or requires any complicated guesswork or calculations.
A GIC should be a GIC, straightforward and clear, with a guaranteed rate of return. The more they mess with the basic formula, the less likely you are to win.  

I agree with Loonie. Keep it simple!

January 3, 2019
3:46 am
AlainJF
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Oscar said
Duca has a TFSA eligible 5 year GIC @3.75% so you can keep it all in one place either way
https://www.duca.com/rates/term-deposits/

Meridian`s full details on their 5 year GIC @3.75% is clear and available at: https://www.meridiancu.ca/Meridian/media/images/PDFs/TC-5Y-350-GIC-Non-redeemable.pdf

Are the similar details available from DUCA somewhere for their 5 year GIC @3.75% ? I did not find it.

January 3, 2019
4:40 am
Oscar
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Alain , maybe you can call them for specifics but it seems to be a standard non redeemable 5 year term and it s not a promo

January 5, 2019
9:56 am
jackie999
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Oscar said
Duca has a TFSA eligible 5 year GIC @3.75% so you can keep it all in one place either way
https://www.duca.com/rates/term-deposits/

Thanks for this - this is what we'll do. It's also the recommendation I got from their CS.

January 5, 2019
11:37 am
Norman1
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The variable 3.00% prime-linked 5-year GIC is not really great when one looks at the alternatives.

It is not great should interest rates stay the same or drop. That's because one would get 3.00% per annum instead of the 3.75% per annum with the standard fixed 5-year GC. sf-frown

It is also not great should interest rates rise. That's because the 3.00% per annum starting rate is low. Right now, one can get a higher 3.10% per annum with one-year GIC's from EQ Bank, Oaken Financial, and Hubert Financial. Those one-year GIC's will also ratchet upwards on renewal as interest rates rise, except that they start at a better 3.10% instead of 3% and don't tie the money up for five years. sf-frown

To me, it looks like a clever way for DUCA to get five-year money for the price of one-year money. sf-surprised

January 5, 2019
6:31 pm
Loonie
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Norman is right. And this is what drives me nuts about credit unions who claim to be always working in the interests of their member-owners.
This is why one has to be wary about any offer , no matter which FI it comes from, and read all the fine print.
They get a lot of their staff from former bank employees, and I guess they bring their perspective with them.

January 6, 2019
11:44 am
Saver-Mom
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I agree.
I would go for 5year 3.75% or their 3% park it TFSA account, good till end of December; you can then do the December manoeuvre if you want to move it elsewhere.

January 6, 2019
3:36 pm
AlainJF
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Saver-Mom said
I agree.
I would go for 5year 3.75% or their 3% park it TFSA account, good till end of December; you can then do the December manoeuvre if you want to move it elsewhere.  

Could you provide details about "... their 3% park it TFSA account, good till end of December; you can then do the December manoeuvre if you want to move it elsewhere. " Which DUCA product are you referring to ?

January 6, 2019
6:46 pm
Saver-Mom
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It is a window that popped up upon logging in.
Perhaps marketed only to current customers?
Why not call and ask. They are very friendly and helpful.
I sent you a private message

January 6, 2019
7:11 pm
AlainJF
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Saver-Mom said
It is a window that popped up upon logging in.
Perhaps marketed only to current customers?
Why not call and ask. They are very friendly and helpful.
I sent you a private message  

Ok, I think that I found it : https://www.duca.com/personal/banking/savings-accounts/tfsa-park-it-savings-account/

But it looks like it was a 3% special until 31st Dec 2018 (not 2019).

It shows on the left here as well: https://www6.memberdirect.net/brand/on_duca/Logoff/

January 6, 2019
8:14 pm
Saver-Mom
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You are right, sorry about that.
They should remove it, confusing.

January 7, 2019
4:19 am
Saver-Mom
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Just received an email from DUCA. The prior offers remain plus they are offering a “3-year GIC with interest at 3.25% plus it's cashable on its annual anniversary. Terms and conditions apply. Visit your branch or call us at 1.866.900.3822 to discuss how the options above can suit either your registered or non-registered account.” So if rates continue to rise, you can cash in early. I think it is a sign that they expect that rates will not rise.

January 7, 2019
4:59 am
Loonie
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I think the 3 yr deal is a win-win, more or less, and does not reflect an opinion about future rates. For them, it's a reasonable rate for one year. Meridian has the same rate, although it may be restricted to registered - not sure. DUCA needed to extend themselves a bit in order to keep some of the HISA money that they took in last Fall with that promo.

If rates fall, it's good for the investor, who can remain invested - and it's good for DUCA too because current 3 year rates are higher elsewhere and they avoided offering them.

If rates rise, a lot of people will forget that they could cash it in or will miss the date, so DUCA wins; and the ones that do remember will be happy because they got a good rate for one year and can then move on.

I would think of it as a one-year investment at a good rate with some downside protection for the next two.

That five year rate is not new, although I'm not sure when they put it up (I think it was beginning of January). It's good though that they are advertising it because that suggests they won't cancel it imminently.sf-smile

January 7, 2019
6:49 am
savemoresaveoften
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While I prefer the 5y 3.75% over the 5y min 3% tied to prime, I do applaud DUCA for being creative and offering a vehicle for those that may want to rec floating for whatever reason. At the same time it makes DUCA more flexible in their financing funding at floating as oppose to fixed. One can't really complain when they put in a floor at 3% as protection for the investor.

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