Written and published by Investors Group as a general source of information only. It is not intended as a solicitation to buy or sell specific investments, nor is it intended to provide tax, legal or investmentadvice. Readers should seek advice on their specific circumstances from an Investors Group Consultant.Mortgage rate is RBC’s 3 year closed mortgage fixed rate and GIC Return is RBC’s posted 3 year non-cashable GIC rate (paid annually) as displayed on the RBC websites March 14, 2012. Calculationsby Investors Group Strategic Investment Planning. The RBC mortgage and GIC comparison shown is used as an illustrative example typical of most major banks. Assumes $100,000 GIC and a corre-sponding $100,000 mortgage.

™ Trademarks owned by IGM Financial Inc. and licensed to its subsidiary Corporations.“A Closer Look at Guaranteed Investment Certificates” © Investors Group Inc. 2012 C3893 (03/2012)

INVESTING CONCEPT

A Closer Look at Guaranteed Investment CertificatesInvestors are led to believe they pay no fees when investing in Guaranteed InvestmentCertificates (GICs). The truth is that the interest you are paid on a GIC is much less thanwhat the bank earns when they subsequently invest your money in loans or mortgages.

Guaranteed Investment Certificates

After a bank sells you a GIC, they then lend yourmoney to another customer as a loan or mortgage.

In this illustration, the bank earns 3.95% whenlending your money as a mortgage, while only paying 2.00%. The difference is the “hidden fee”the bank retains.

$1,950

$2,000

Year 1

$1,950

$2,000

Year 2

$1,950

$2,000

Year 3

$5,850

$6,000

Overall

What the bank

keeps for themselves

49.4%

What the bank

pays to you

50.6%

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