21 December 2023
If you want to study in Canada and apply for a student visa through the Student Direct Stream (SDS), there are many factors you need to consider. And having enough funds in your account is one of the topmost requirements you have to fulfil.
You need to have at least CAD 10,000 in a special bank account called a Canada GIC account, often provided by banks like the Royal Bank of Canada (RBC).
But not everyone has enough money for this account.
So, can your friends or anyone else help you by putting money into your GIC account?
Yes, they can, but it’s not simple.
There are some regulations about money and immigration that you and your friends need to follow, making the process a bit complicated.
What is the GIC Account for International Students in Canada?
A GIC, which stands for Guaranteed Investment Certificate, is like a special bank account for international students in Canada. It’s a type of investment that banks provide to students as a way to show they have enough money for their studies and living costs.
It’s a way for students to set aside money for their education and have a guaranteed return on their investment.
With the RBC International Student GIC Program, students put a fixed amount of money in this account, and in return, they get fixed monthly payments for a certain time.
This helps students have a steady income while they’re studying in Canada, making their finances stable. The Canadian government has these rules for students who want to study in Canada through the Study Direct Stream (SDS) program, ensuring they can manage their expenses during their studies.
Can You Get Your GIC Account Funded by a Relative, Acquaintance or Friends?
Of course! If you have a friend, relative or anyone willing to help, you can use their affidavit of support as proof of funds when applying for a student permit in Canada.
Your friend may provide proof of funds, such as pay stubs, bank statements, or an employment letter, to demonstrate that they have enough to support you while you are visiting.
A signed affidavit of support, a legal document attesting to your friend’s commitment to and capacity for providing financial support, is also required.
It’s important to remember that using a friend’s affidavit is just one way to prove funds, and the Canadian government might ask for more documents to ensure everything is for your stay.
In the next point, we will understand how opening a joint GIC account can help you with this purpose.
Opening a Joint GIC Account with Friends or Acquaintance
A common way to get help from friends is by opening a joint GIC account. This special account lets multiple people, like friends or family, share ownership. Each person has equal rights to the account, and if one person can’t be part of it anymore, the others still keep control.
With a joint GIC account, friends can combine their money in one place.
This is helpful if someone doesn’t have enough money on their own but still wants to benefit from the stable returns of the GIC. It’s like a teamwork approach to investing, and it ensures that everyone involved has a say in how the account is managed.
Understanding the Considerations and Challenges Associated with GIC Account Funded by Friends or Anyone
Trust and Communication
The foundation of any successful financial collaboration is trust and communication. Clearly outline your investment goals, terms, and expectations with friends and family. Open communication can prevent misunderstandings and pave the way for a smooth financial venture.
Legal Implications
However, delving into joint GIC accounts comes with legal complexities. Seeking advice from an immigration lawyer can ensure that all legal matters are handled professionally. Drafting necessary agreements helps in managing expectations and avoiding future disputes.
Withdrawal Restrictions
GICs often have withdrawal restrictions, especially if they come with a fixed term. Co-owners should be aware of these limitations and discuss the best course of action in the event of an early withdrawal necessity.
Consider Taxes
The returns generated from a GIC may be subject to taxation. Co-owners should familiarize themselves with the tax implications and might consider consulting a tax professional for guidance on tax planning.
Exit Strategy
Planning an exit strategy is crucial. What if one friend wants to withdraw their share before the maturity date? Agreeing on a plan in advance can address such scenarios and prevent conflicts.
The Conclusion:
Friends can invest in your GIC account through a joint GIC. However, it comes with some concerns. Therefore, make sure to discuss everything with them, including goals, terms and expectations.
It is equally necessary to have a thorough understanding of the financial and legal elements. If you still have questions, please contact one of our study abroad advisors right away. We’ll walk you through the steps and make sure everything works out well for you.
