Segregated Funds:
Protection For You
Author: Ivon T. Hughes
Segregated funds combine
the investment potential of mutual funds with the security of insurance.
When you invest in a segregated fund, you are actually buying an insurance
contract. The money from each contract is then invested in an underlying
mutual fund with the returns of your segregated fund closely tracking those
of the underlying mutual fund.
Segregated funds come with guarantees designed to protect your capital. You
are guaranteed that you will get back, at maturity or death, up to 100% of
your investment, regardless of how markets perform or the market value, whichever
is greater.
Segregated funds, like mutual funds, can be bought or sold at any time. However,
if you sell prior to the maturity date, you will receive the market value,
which may be less than your original investment.
Segregated funds sometimes include a "reset" feature, which allows
you to lock in investment gains and reset the minimum guaranteed amount at
a higher level.
In addition to the death benefit that helps you preserve your investments,
segregated funds can help you with a faster estate payout as funds will flow
directly to your beneficiaries, bypassing the probate process.
If you own a business, are self-employed or are the director or officer of
a company, your savings can be at risk if creditors can make a claim on your
personal or business investments. However, as an insurance contract, segregated
funds are possibly out of reach to creditors if you name a spouse, child,
parent or grandchild as beneficiary. The protection isn't foolproof, but
should be effective if you don't try to use your segregated funds as an emergency
asset shelter.
The Hughes Trustco Group offers you the complete selection of segregated
funds all, on a no load basis, which means you are in control of your capital
at all times.
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Ivon T. Hughes, The Hughes Trustco Group Ltd.
Online Insurance Broker - Get a FREE Quote TODAY!
Tel: (514) 842-9001 Email: [email protected]
Web: http://www.trustco.ca
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