The Best Guaranteed Investment That Withstands The Market Ups & Downs! Part 2

With all these inevitable risks, coupled with the current market condition, it more than ever essential to turn to guarantees and other advantages designed to promote peace of mind. Segregated Fund contracts can be an integral component of a diversified portfolio to ensure that your aspirations and goals for you and your loved ones are achieved with confidence. In addition to access to the growth potential of the markets, investors may take comfort in knowing they can benefit from the following value‑added features:

Maturity Guarantee

At the maturity date, the owner is guaranteed to receive the greater of the market value or the maturity guarantee amount, subject to the provision in the contract or product chosen. This means that in the worst-case circumstance, you’re getting up to 100% of all deposited.

Payout Benefit Guarantee

It guarantees that you get the scheduled income payments provided in the contract, even when the market value is down. In down markets, this guarantee offers additional protection, ensuring that your steady income stream is not interrupted.

Death Benefit Guarantee 

Upon the death of the last surviving Annuitant, the beneficiaries will receive a guaranteed amount, the greater of the market value or the Death Benefit Guarantee. The death benefit could be up to 100% of all deposits, less any withdrawals.

Guaranteed Income For Life

Some segregated fund contracts include features that can deliver a guaranteed stream of income for your lifetime or a fixed number of years, as desired. With a guaranteed, predictable income for life, you can be confident that you won’t run of money. Income guaranteed, cannot decrease no matter how the investments perform. 

GIF solutions offer you protection in the market by lowering your risk with guarantee, more rewards and certainty

Resets to Lock-in Market Gains

This feature work to capture market growth by allowing the owner to periodically lock-in increases in the market value of their segregated fund contracts. Resets may be automatic or client‑initiated with the assistance of a financial advisor, and may impact the maturity guarantee or Death Benefit Guarantee.

Creditor protection

A segregated fund contract has the potential to protect a client’s assets from creditors. This feature is ideal for professionals and small business owners looking to help protect their personal assets from professional liability. 

Estate planning benefits

In addition to guarantees, segregated fund solutions offer your estate planning advantages by helping your loved ones receive an inheritance more quickly and may assist investors to leave more to heirs than they would be able with other types of investment products. Since Segregated funds are insurance contracts, death benefit proceeds pass on quickly and privately to the designated beneficiaries (other than an estate) without any legal, estate administration and probate fees.

Canadians, who are focused on securing a financial future for their family, after they are gone, can rest assured knowing that their loved ones will not endure additional stress during those difficult times.

Comparing the benefits of a Segregated Fund versus Mutual Fund

Other Additional Benefits to You

Potential Creditor Protection

Assets flowing through an estate (which generally occurs when non‑registered assets paid by financial institutions other than insurance companies) may be subjected to creditors of the deceased, which could mean a smaller inheritance for your heirs. 

Privacy & Confidential

Proceeds bypassing the estate and paid to the named beneficiary can preserve confidentiality as the application for probate is a matter of public record. The ability to bypass probate saves your named beneficiaries time and money as well as estate fee upon your death.

Quick & Fast


Settling an estate can be lengthy, frequently taking months or even years should the will be challenged. With a named beneficiary, other than the estate, death benefit proceeds of a segregated fund contract can pass directly to the recipient within a month or two and avoid these delays.

Annuity Settlement Option


This option automatically transfers segregated fund proceeds upon death into an annuity, in accordance with the terms chosen by the client. You also have the opportunity to replace a lump sum death benefit with smaller scheduled payments while providing savings you legal, estate administration and probate fees. It offers additional privacy and potential creditor protection. For heir(s) with poor money management skills or minors, this option comes in handy to spread the inheritance whiles you’re away, at no cost to you!

Want to learn more about Guaranteed Investment Funds and how it can complement your current financial plan, to help you achieve your aspirations and dreams with peace of mind? Connect with us virtually @ https://app.hubspot.com/meetings/fb4, for a complimentary assessment. To Your Future Success!

The Best Guaranteed Investment That Withstands The Market Ups & Downs.

Everyone would all like higher returns on their investments, but few are willing to assume the higher risk usually associated with higher returns. We are aware the markets move up and down, and likewise, we should learn how to factor in the downturn of the market. Unfortunately, volatility is a 2-way street.

People feel confident about their investments in a healthy market. But when the market turns downward, emotions tend to run high. It’s a smart strategy to factor in the downturn phase in our investment plan. This worry has many Canadians looking for investment or retirement vehicles that will not only position their investments for growth when markets are up but also have the potential to protect their capital when markets drop. Any market drops in the years leading up to, or at the retirement stage, can have a devastating impact on a financial future.

Research has shown, not so surprising, that many of us want higher returns than we can achieve with traditional investments like GICs. However, we are uncomfortable or unwilling to assume the risk that can come with those investments that can help us in current investments like mutual funds and stocks.

Today’s investors, like myself, have a simple list of wants when it comes to our money or wealth. They want to :

(a) build and protect their savings,

(b) provide for loved ones

(c) plan for a steady stream of retirement income

(d) retire with confidence and certainty.

An investment product that gives investment choice and the potential for capital growth, the flexibility for diversification and the security of a guaranteed investment is a “Segregated Fund.”
Segregated Funds are most appropriate if you are looking to grow and protect your wealth now and into the future and potentially pass it on to the next generation tax-efficiently.

Segregated fund contracts offer built‑in features designed to help clients achieve peace of mind whiles participating in markets upturns and protecting your capital in downturns. All of these benefits are not possible with other investment vehicles. They appeal to conservative investors, particularly those who worry about market downturns. Over the past few months, I’ve learned that even aggressive investors still have a conservative side to them. Perhaps, you are in this category as well. They have elements that attract business owners and professionals, who may have concerns about creditor protection. They also provide advantages to anyone looking for strategies to protect an estate for loved ones.

Like mutual funds, Segregated Funds are professionally managed and invested in a portfolio of investments. Many segregated funds invest in brand-name mutual funds. But, unlike mutual funds, Segregated Funds are insured investment products. In essence, they are insurance contracts that offer additional benefits such as principal investment guarantees, death benefit guarantees, creditor protection and other estate planning benefits.

Anyone regardless of age, who’s building a nest egg or saving for the future or retirement, can potentially have their savings/ investments negatively impacted by three significant risks:

Market volatility


People feel confident about their investments in a healthy market. But when the market turns downward, emotions tend to run high. Any market drops in the years leading up to, or at the retirement stage, can have a devastating impact on a financial future.
This worry has many Canadians looking for retirement vehicles that will not only position their investments for growth when markets are up but also have the potential to protect their capital when markets drop.

Inflation


Inflation can undermine your portfolio’s purchasing power over the long term. This chart shows how $100 spent on a “basket of goods & services” in 1990 inflates over time. After 30 years of inflation, the cost increase by over 75%. It’s essential to build a financial plan that offers an opportunity for growth, to minimize the effect of inflation.

The Eroding Power of Inflation on your future wealth

Longevity


With the advancement in medical breakthroughs, better health care and safer workplaces, we are living much longer. And this could mean that people retiring today may be looking forward to a retirement of three or more decades – almost as long as the working phase of their lives. And more than ever, it’s essential to have a plan that put together ideas to help build sufficient wealth to provide income for a longer lifetime, especially during retirement.

Look out for the conclusion of the article in my next blog, Part 2…