GIC Ladder Calculator
Split one amount across staggered terms so a rung matures every year
Your ladder
Five rungs is the classic ladder: terms of 1 through 5 years.
One year per step means one rung matures every year.
How far ahead to run the ladder.
Rolls every maturing rung into a new long-term GIC, which is what makes a ladder converge on long-term rates.
Defaults follow a mildly rising curve. Replace them with real quotes from your bank or brokerage.
Maturities over time
Maturity schedule
Which rung matures when, and what it is worth on that date.
| Matures in year | Rung | Term | Rate | Amount invested | Interest | Value at maturity |
|---|---|---|---|---|---|---|
| 1 | 1 | 1 | 4.00% | $10,000.00 | $400.00 | $10,400.00 |
| 2 | 2 | 2 | 4.05% | $10,000.00 | $826.40 | $10,826.40 |
| 3 | 3 | 3 | 4.10% | $10,000.00 | $1,281.12 | $11,281.12 |
| 4 | 4 | 4 | 4.15% | $10,000.00 | $1,766.22 | $11,766.22 |
| 5 | 5 | 5 | 4.25% | $10,000.00 | $2,313.47 | $12,313.47 |
Ladder versus a single GIC
The same $50,000 over the same 5 years, put entirely into one term instead.
| Strategy | Value at horizon | Interest earned | Access to your money |
|---|---|---|---|
| GIC ladder | $61,390.35 | $11,390.35 | A rung every 1 year(s) |
| All in 1-year GICs, rolled over | $60,832.65 | $10,832.65 | Every 1 year(s) |
| All in one 5-year GIC | $61,567.33 | $11,567.33 | Only at the end |
How a GIC ladder works
A ladder splits one amount into equal pieces across staggered terms, so part of your money comes free every year while the rest keeps earning long-term rates.
Building the ladder
Take the amount you want to invest and divide it into equal rungs. With $50,000 and five rungs you buy $10,000 each of a 1, 2, 3, 4 and 5-year GIC. At the end of year one, the 1-year GIC matures. You either take the cash or reinvest it in a new 5-year GIC. At the end of year two the original 2-year GIC matures, and so on. After five years every rung has been replaced with a 5-year GIC, and one of them still matures every single year. That is the whole trick. Once the ladder is mature you earn 5-year rates on the entire balance while a fifth of the money becomes available annually. You give up the peak return of locking everything into the longest term, and you give up the flexibility of keeping everything short, in exchange for a reasonable amount of both.
Why bother
Putting the whole amount into one term is a bet on interest rates. Go long before rates rise and you are stuck below market for years. Stay short before rates fall and you renew into worse ones. A ladder averages your rate across the cycle so neither call has to be right. It also solves a practical problem. Money that might be needed at some point, but not on a known date, does not fit a single GIC. A ladder gives you a scheduled exit every year without paying the penalty for breaking one early. The comparison table above puts numbers on the trade: on a rising rate curve the all-long option usually wins on paper, and it wins by less than most people expect, while locking your money away completely.
Assumptions
Reinvested rungs are assumed to renew at the rate you entered for the longest rung. Real renewal rates will be whatever the market offers on that future date, which nobody knows. Treat the horizon value as a scenario, not a forecast. Interest is assumed to compound annually within each GIC and to be fully reinvested on maturity when the reinvest option is on. If you plan to spend each maturing rung, turn reinvestment off. Tax is not applied. In a non-registered account GIC interest is taxed as ordinary income each year as it accrues, which the GIC calculator models. A ladder held inside a TFSA or RRSP avoids that entirely.
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Frequently Asked Questions
Last updated: July 2026
A GIC ladder splits one amount into equal pieces across staggered terms, so a portion matures every year. With $50,000 and five rungs you buy $10,000 each of a 1, 2, 3, 4 and 5-year GIC. Each year the shortest rung matures and you reinvest it into a new 5-year GIC. After five years the whole ladder earns 5-year rates while a fifth of the money still comes free annually.
Usually not on the headline number, and that is the point. On a rising rate curve, putting everything into the longest term produces the highest projected value, because you take the highest rate on every dollar from day one. What you give up is access: your money is locked for the whole term. A ladder trades a small amount of return for a scheduled exit every year and for not having to guess where rates go next.
Reviewed by Alexandre Bernier, CFP®, CIM®
Educational tool - estimates only. Not individualized financial, investment, tax, or legal advice. Using it does not create an advisor-client relationship. Rules and figures change; verify against current CRA sources and consult a qualified professional. Editorial policy →