How Maturity Guarantees Can Protect You During These Tough Times

These are extremely volatile times. The investment world is struggling and has shown a steady decline for most of the calendar year. An investor could be worried about how their investments are holding up as the market falls off. This is where the maturity guarantee truly shows it’s value.

How do these maturity guarantees work to your benefit now? Your “High Water Mark” was set at your investments highest value so you are guranteed that amount. When there are more than 10 years to the maturity date of the investment, your Stock Market Guarantee is updated to reflect your investment’s market growth, deposits and withdrawals. In the final 10-year period, deposits made increase the guarantee at a rate of 75% of the deposit value, and withdrawals reduce the guarantee proportionately.

This powerful guarantee allows you to enjoy the performance of the equity markets with peace of mind, knowing that on your chosen maturity date, you’ll receive no less than the highest value achieved by your investments on any day up to 10 years prior, regardless of market performance. Of course, if the value of your investments is higher than the guaranteed amount on your chosen maturity date, it’s yours to keep.

Example

Another great aspect of this feature is that it allows for us to continue to build your investment without “catching up”. We stop depositing into the current plan and start a new one. Why contribute to rebuilding the fund when we are guaranteed the higher value? Ideally we move the remaining funds into an aggressive growth fund in an attempt to rebuild quickly and we will not worry about it until it at least reaches that “high water mark” and then move it back into a more appropriate portfolio reflecting your risk tolerance. This prevents us from adding funds to the rebuilding process and reduces the risk for any new deposits.

I appreciate this can be somewhat confusing so please contact me if you have any questions.