When a GIC matures, your institution does whatever the maturity instruction on file tells it to do, and if there’s no instruction, the near-universal default is to renew the money automatically into a similar term at whatever rate the institution posts that day. That default is convenient for exactly one party, and it isn’t you.
Maturity is the moment your money becomes free to chase the best rate anywhere — unless the default gets there first. If the product itself is still new to you, GetSmarterAboutMoney.ca’s overview of how GICs work covers the basics from the investor-education side.
The default is renewal, and the renewal rate is the catch
Auto-renewal exists because it keeps deposits in the building. Nothing sinister has to happen for it to cost you: the renewal simply lands at the institution’s posted rate for that term on that day, and posted rates are routinely lower than the promo rates institutions use to attract new money. The rate that brought you in the door is almost never the rate that greets you at renewal, and doing nothing means accepting whatever the posted rate happens to be that day, frequently below both what your original GIC paid and the best current market rate.
That makes the renewal rate the one number you should never accept unseen. Before maturity, ask what the renewal would pay, then hold that figure up against the current board for your term. If the renewal rate matches or beats the market, renewing is genuinely fine, and it’s the least paperwork. If it doesn’t, you now know exactly what staying put costs. Checking that board before maturity is the single highest-value step in the whole process.
Before you accept any renewal offer, the table below shows what the market pays as of our latest observations.
Your instruction options, decoded
Most institutions let you set or change the maturity instruction any time before the maturity date, online or with a phone call. The menu is usually some version of this:
| Instruction | What happens at maturity | Watch for |
|---|---|---|
| Renew, same term | New GIC starts automatically at the posted rate | The rate is set on renewal day, not promised in advance |
| Renew, different term | Same, but into the term you chose | Promo rates rarely apply to renewals automatically (ask) |
| Pay out | Principal plus final interest lands in your linked account | Money then sits idle until you redeploy it |
| Transfer out | Funds move to another institution you’ve arranged | Paperwork takes time, so start before maturity week |
One instruction worth knowing about: some institutions let you renew the principal but pay out the interest, which suits savers living on deposit income. And if part of your plan is splitting the money across several terms, maturity is the natural moment to set that up.
The grace period is your undo button
Miss the maturity date and wake up auto-renewed? You likely have a short window to fix it. Federally regulated banks must give you 10 business days after an automatic renewal to cancel or change the new GIC without penalty, and most other institutions offer a similar or longer window. The length and the fine print vary by institution: some pay interest for the days the renewed GIC ran before you cancelled, others pay nothing for them.
Treat the grace period as a safety net, not a strategy. The window is short, and it isn’t universal. The clock starts at renewal whether or not you noticed the renewal happen, so the reliable version of this protection is setting your instruction before maturity rather than unwinding a renewal after it.
Maturing inside a TFSA, RRSP, or FHSA
Registered accounts add one crucial distinction: the difference between a transfer and a withdrawal. Moving registered money to a better rate at another institution should be done as a direct transfer, a form-driven process between the two institutions that keeps the money registered the whole way. Cashing out and re-depositing it yourself is a withdrawal, and withdrawals have consequences that differ by account:
- TFSA: a withdrawal doesn’t cost you the room forever, but the contribution room from a withdrawal only comes back on January 1 of the following year, so a cash-out-and-redeposit in the same year can create an accidental overcontribution.
- RRSP: withdrawals are taxed as income, tax is withheld at source, and the contribution room is permanently lost, which makes a withdrawal the expensive way to change banks.
- FHSA: a withdrawal that isn’t a qualifying home-purchase withdrawal is taxable as income, so moving FHSA money between institutions should always go the direct-transfer route.
The mechanics: open the account at the receiving institution first, then ask that institution to pull the funds with its transfer form. The receiving side generally does the chasing. Some institutions charge a transfer-out fee on registered accounts, and some receiving institutions will cover it if you ask, so ask. Once the money arrives, the current TFSA, RRSP, and FHSA boards show what it can earn in its new home. How GICs behave inside these accounts more broadly is covered in our registered GICs guide.
A maturity-week checklist
Maturity week goes smoothly when it’s really maturity fortnight. Working backwards:
- Two weeks out: find the maturity date and the instruction currently on file. If you don’t know either, that’s the first phone call.
- Check the market: look up your term’s current board and note the best rate you’d actually move for.
- Ask for the renewal rate: get the number your institution would renew you at, and compare it to the board.
- Registered money: if you’re moving a TFSA, RRSP, or FHSA GIC, open the receiving account and start the direct-transfer paperwork now, not on maturity day.
- Set the instruction: renew, pay out, or transfer. Anything but the silent default.
- After maturity: confirm the money went where you told it to. If a renewal caught you anyway, the grace period is your window to act.
The step most people skip is the first one, because maturity dates are easy to lose track of. A rate alert solves the other half of the problem: it tells you what the market pays when your money comes free, so the renewal rate never gets to be the only number you see.
Frequently asked questions
Will my bank tell me before my GIC matures?
Most institutions send a maturity notice by mail or to your online banking inbox a few weeks before the date, but notices are easy to miss and not guaranteed to arrive early enough to arrange a transfer. Track the maturity date yourself rather than relying on the reminder.
Can I get out of a GIC after it auto-renews?
Often yes, briefly. Federally regulated banks must allow cancellation within 10 business days after automatic renewal without penalty, and many other institutions offer a similar or longer window. After that window closes, the renewed GIC is a locked term like any other, unless it happens to be a redeemable product.
How do I move a matured GIC to another bank without losing my TFSA room?
Use a direct transfer between institutions rather than withdrawing the cash. Open the TFSA at the new institution and have it pull the funds with its transfer form; the money stays registered throughout and your contribution room is untouched. Withdrawing and re-depositing in the same year can overshoot your room.