Canadian investments, compared
If accounts are the containers, these are the contents — arranged from the safe end of the ladder to the growth end. Returns shown are historical illustrations, never promises.
| Instrument | Risk | Typical long-run return* | Money you may need in… | Watch out for |
|---|---|---|---|---|
| HISA & cash ETFs | Very low | ~2–4% | Any time | Rates float; cash ETFs have no CDIC insurance |
| GICs | Very low | ~2.5–5% | At maturity — locked | Non-redeemable means locked; inflation outpaces in bad years |
| Bonds & bond ETFs | Low–medium | ~2–5% | 2+ years | Prices dip when interest rates rise |
| Balanced all-in-one ETFs (60/40) | Medium | ~4–6% | 5+ years | Bad years still happen — 2022 hit stocks and bonds together |
| Global equity all-in-one ETFs | High | ~6–8% | 10+ years | Paper drops of 20–40% at some point are near-certain |
| U.S. index ETFs | High | ~6–9% | 10+ years | Currency swings; 15% U.S. dividend withholding in a TFSA |
| Individual stocks | High–very high | Varies widely | 5+ years | Single-company risk; no basket to catch you |
| Active mutual funds | Medium–high | Market minus fees | 3+ years | MERs of 1.5–2.5% compound against you |
| Instrument | Inside TFSA/RRSP/FHSA | In a non-registered account |
|---|---|---|
| Interest payers (HISA, GIC, bonds) | Ideal — interest fully sheltered | Worst case — interest taxed at full rate |
| Broad equity ETFs | Great — growth compounds untaxed | Tolerable — 50% gains inclusion, deferred until sale |
| Canadian dividend stocks/ETFs | Great | Good — dividend tax credit softens the bill |
| U.S. dividend payers | RRSP best (treaty exempts withholding); TFSA loses 15% | Foreign tax credit can apply |
Go deeper: the investments series
What is an ETF? The beginner's building block
An Exchange-Traded Fund is a basket of hundreds or thousands of investments you buy in one purchase. Why ETFs became the default answer for Canadian beginners.
GICs and high-interest savings: the safe end of the ladder
Where money goes when it must not shrink: high-interest savings accounts, GICs, and cash ETFs — what each guarantees, what each pays, and where the catches are.
Stocks, bonds, mutual funds: an honest comparison
The three classic products behind every portfolio — what owning each actually means, what they return, what they cost, and why fees decide more than skill.
All-in-one ETFs: a whole portfolio in one purchase
XEQT, VEQT, VGRO and family — Canadian asset-allocation ETFs hold thousands of stocks and bonds, rebalance themselves, and cost about 0.2%. Why they became the beginner's default.