Wealth Management


An annuity is an investment that provides an income stream for a stated period of time in exchange for a lump sum payment (single premium). The income ceases at the end of the stated period.

Types of annuity:

Annuity Certain – The stated period is a fixed duration (e.g., 10 years). Also referred to as Term Certain Annuity.

Life annuity – The income payments must be contingent on a person(s) being alive.

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Guaranteed Deposits

Guaranteed Investment Certificate

A deposit investment security sold by Canadian banks and trust companies. They are often bought for retirement plans because they provide a low-risk fixed rate of return. The principal is at risk only if the bank defaults.

Term Deposits

A deposit held at a financial institution that has a fixed term. These are generally short-term with maturities ranging anywhere from a month to a few years. When a term deposit is purchased, the lender (the customer) understands that the money can only be withdrawn after the term has ended or by giving a predetermined number of days notice.

Term deposits are an extremely safe investment and are therefore very appealing to conservative, low-risk investors. By having the money tied up you'll generally get a higher rate with a term deposit compared with a demand deposit.

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Segregated Funds

Segregated fund is a pool of money, invested in stocks, bonds or Treasury Bills held solely for the benefit of the unit holders of the fund and which cannot normally be touched by creditors. With a named beneficiary, your funds normally will be protected from your creditors. At death, with a named beneficiary, your funds go directly to your beneficiary, without probate fees.

Segregated fund capital is guaranteed by an insurer and achieves capital gains just like a mutual fund. The minimum rule is 75% of capital is guaranteed after ten years even if the fair market value (FMV) is below this 75%. Some insurance carriers will even guaranteed 100% of the capital after ten (10) years.

Because this is an insurance contract, the death benefit guaranteed is 75%-100% of your capital with no time restriction.

Segregated Funds also have the following features that mutual funds do not have:

Bypass Probate

With a named beneficiary, your funds go directly to your beneficiary, without probate fees.

Reset Feature

You can periodically "lock in" the protection on the principal when the policy has escalated in value. This resets your 10-year guarantee period.

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