Have you been lately thinking about investing your assets in the market? Well, that’s a great way to start your savings for your golden years. However, you might be thinking about where to start; well, segregated fund policies can be the ideal option for you. These policies give you the freedom to invest while offering insurance protection to preserve your funds from market fluctuations. You can almost consider it as a protection net for your investment with which you can expand your wealth as well as secure it. For further details, you can always get in touch with our team at InsLyf, we look forward to hearing from you.
So, how do segregated funds work?
These funds are structured as deferred variable annuity contracts with life insurance benefits and are managed by insurance companies in separate accounts. You should know that they are not traded in the public market and must be held until maturity. You can choose to invest in this policy based on its investment objective and product terms.
The funds offer capital appreciation through investment up to a specified maturity date and come with the additional advantage of death benefits (just like an insurance policy). Generally, they guarantee a payout of at least 75% to 100% of the premiums paid. Investors can choose from several options for a payout schedule offered by the product once the segregated fund matures. If you have further queries, feel free to contact InsLyf.
Several benefits that come with segregated funds
Have a look at the following points to know more about the benefits of segregated funds:
Maturity and death benefits: Seggergated funds guarantee your original investment and you will have the option to choose between 75% or 100%. So, even if the market drops, you’ll get most or all of your original investment back. In the unfortunate event of you (the policyholder) passing away, your beneficiary will receive either the market value of your investments or the guaranteed amount, whichever is higher at the time of your death.
Lock-in: These funds also offer you the ability to lock in your gains as part of the principal when you reach a maturity or death guarantee for an additional fee. If your principal investment grows, you can lock in the new amount which in turn makes that your new guarantee amount.
Estate planning: With segregated funds, your beneficiaries will receive money without having those funds flow through your estate. Meaning, the money in your policy won’t be reduced by taxes and the associated fees that come with settling an estate. Your beneficiaries will also get the money faster (within a few weeks after the paperwork is filed).
Liability protection: You’re less exposed to liabilities that could decrease your assets and your policy may be protected in the event a lawsuit is filed against you.
Advantage over mutual funds
A major advantage over mutual funds for segregated funds is, you have the guarantee of getting the maximum amount of your investment back once your policy matures. With mutual funds that may not be the case as it depends on market fluctuations. You can speak with our team at InsLyf for all the details that you need to know about segregated fund policies, schedule an appointment today.
If you want to know more about segregated funds, contact one of our professional financial advisors at InsaLyf today!