How a HISA and GIC can strengthen your emergency fund
An emergency fund is one of the most useful tools in your financial toolkit. It can give you the ability to handle life’s surprises, like a sudden car repair, medical bill, or job disruption, without taking on debt or sacrificing your long-term plans.
Where you keep your emergency savings matters, in terms of how they grow and how easy they are to access. You want your money to be safe, accessible and earning interest while it waits. That’s where two simple, low-risk savings tools come in: a High-Interest Savings Account (HISA) and a Guaranteed Investment Certificate (GIC).
Used together they offer a practical, steady approach that keeps you ready for the unexpected and allows you to be brilliant with your savings.
Why a High-Interest Savings Account (HISA) is your first line of defence
A HISA works much like a regular savings account, but typically offers a better rate of interest. These accounts are designed for savings rather than everyday spending, which means they often earn more while still giving you access to your money at any time.
Some HISAs offered tiered interest, where higher balances earn higher rates. Others may have promotional rates for a set time or require a minimum balance. It’s important to look at all the fine print when opening a HISA to ensure you are maximizing your savings.
A HISA is a solid place to keep the part of your emergency fund you may need to use right away. Your money earns daily interest and can be transferred when you need it, likely without penalties or restrictions (when compared with investments).
When a Guaranteed Investment Certificate (GIC) makes sense
Once you’ve built a solid buffer in your HISA, you might want to put a portion of your emergency fund into a GIC, which is more fixed than a HISA but generally offers higher interest rates.
A GIC lets you set aside money for a fixed term, usually one-to-five years, in exchange for a guaranteed rate of interest. Your return is locked in, your principal is protected, and there’s no risk of losing your savings due to market fluctuations.
However, it’s important to choose a GIC that fits your financial goals and time horizon. While some GICs allow early withdrawal under specific conditions many do not, and accessing your funds early could result in penalties or forfeited interest. GICs are best suited for savings you’re confident you won’t need in the short term.
A two-part plan that works together
A HISA and a GIC serve different purposes, but used together, they help you build a more resilient emergency fund.
The HISA gives you flexibility. Your money is available when you need it and continues to grow in the meantime.
The GIC gives you structure. It encourages long-term savings habits and rewards you with a guaranteed return.
Keeping both accounts in one place can also make your savings easier to manage. You can track your progress, make decisions with confidence, and get support from one team that understands your full financial picture.
A simple way to feel more in control
Saving for emergencies isn’t about complexity, it’s about having a plan you can count on. With a HISA and GIC working together, you’re setting yourself up for financial stability.
It’s not flashy, but it works. And that’s what makes it brilliant.
This article is provided for general information purposes only. It is not to be relied upon as financial, tax, or investment advice or guarantees about the future, nor should it be considered a recommendation to buy or sell. Information contained in this article, including information relating to interest rates, market conditions, tax rules, fees, and other investment factors are subject to change without notice and Cost Capital Savings Federal Credit Union is not responsible to update this information. All third party sources are believed to be accurate and reliable as of the date of publication and Coast Capital Savings Federal Credit Union does not guarantee accuracy or reliability of such sources. Readers should consult their own professional advisor for specific financial, investment, and tax advice tailored to their needs to ensure that individual circumstances are considered properly and action is taken based on the latest available information.
