It hasn’t happened very often in the past 20 years that you could earn a reasonable amount of interest on your savings. Right now, you are able to buy either GICs or Bonds that offer a yield of over 5%. Looking at historical data tells us that these rates are abnormally high and won't last long. Over the past ten years the average annual return on the FTSE Canada Universe bond index is approximately 1.87% while the average GIC rate over the past ten years is slightly lower at 1.73%.

If you have cash and you want to continue earning a 5% rate of return over the next 3 years we can implement a bond ladder strategy to accomplish this.

This particular strategy involves diversifying fixed income holdings across multiple bonds with staggered maturities. Creating a bond ladder ensures steady cash flows as a new bond matures every year.

 The following rates can change at any time and are being used to illustrate the strategy:

 An investment grade bond that in yielding 5.03% and matures in 1 year, 

An investment grade bond that in yielding 5.3% and matures in 2 years, 

An investment grade bond that in yielding 5% and matures in 3 years,

By investing in all three of these bonds it insures that you will earn a 5% rate of return every year for the next 3 years.

If you want to stretch out these high rates to make them last, Lets Chat!

Bond investments can be made by Jennifer Snyder and Hannah Giesbrecht, Portfolio Managers at Doyenne Financial Ltd. after risk tolerance assessments and cash flow considerations have been done. Yields on bonds and GICs are subject to change.