A New MUTUAL FUND

That Offers Retirees Peace of Mind

Society is currently undergoing what many demographers are calling the “Longevity Revolution.” Thanks to health and medical breakthroughs, we’ve seen the average Canadian life expectancy soar from 68 years in 1950 to 82 today.

Retirees should be embracing these extra years, spending time with family, travelling or pursuing new interests. But this new era of longevity comes with a challenge – we now need to stretch our retirement savings to make them last for those extra years.

Perhaps you’ve stayed up late at night facing the same burning questions: How long will I live? Have I saved enough? What will my returns look like in five years? You’re not alone, says David Cravit, chief marketing officer at C.A.R.P., a leading advocacy group for older Canadians. “Our research shows that an increasing number of retirees fear that they’ll outlive their savings.”

NEW SOLUTIONS NEEDED

Those who are lucky enough to be enrolled in a defined benefit pension plan may not be as concerned – they receive monthly payouts as long as they live regardless of how the markets perform. Unfortunately, these cherished pension plans, which are difficult to maintain and manage, are disappearing quickly.

As well, annuities, which were once popular with retirees looking for guaranteed income safe from market volatility, have also fallen out of favour. Investors don’t like the moderate returns they offer and worry that by locking up their money, they’ll be missing out on opportunities for better returns.

Canadians who stress about how long they’ll live and whether they’ll deplete their savings, are actively seeking new investment products that will alleviate these worries.

LONGEVITY PENSION FUND

The new Longevity Pension Fund by Purpose Investments is a creative solution to the retirement income problem. This unique mutual fund works by combining the strengths of a pension plan and an annuity into one user-friendly package that’s accessible to all Canadians.

The Longevity Pension Fund is the ideal product for those who don’t want to spend their retirement worrying about how long they’ll live and whether their money will last. It removes this anxiety by investing your money for you, providing a steady stream of monthly payments that lasts your whole life while generating higher income payments than traditional lifetime income products. Plus, it gives you more control over your finances, allowing you to invest more into the fund or get your money back, depending on your situation.

Let’s say you have built up $200,000 in your Longevity Pension Fund. Based on current rates (6.15 per cent for those between the ages of 65 and 67), when you hit 65, you will start receiving an annual income of $12,300 – or $1,025 each month. Plus, the fund’s unique structure means that as the years go by and the number of investors in the original investing pool decreases (some will pass away while others will redeem their capital), those who remain in the fund will likely see their monthly income increase.

And, thanks to a recent partnership between Purpose Investments and C.A.R.P., members who invest in the Longevity Pension Fund can qualify for a 15 per cent reduction on the company’s already low management fees.

RETIREES FEAR THAT THEY’LL OUTLIVE THEIR SAVINGS