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 | Benefits of Manulife Guaranteed Products
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Designed with superior features and flexible options to help you meet your financial goals, Manulife guaranteed products include additional benefits that are unavailable through banks, trust companies and mutual fund organizations. Discover the benefits of Manulife guaranteed products and find the answers to your questions below:
| Why are guaranteed investments important? |
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Guaranteed investments can form an integral part of your financial portfolio because, regardless of market conditions, the guaranteed portion of your portfolio is always growing -- and that reduces overall risk.
Depending on your individual investment needs, you may use a guaranteed investment as:
- A solid foundation for a well-diversified investment portfolio,
- A short-term savings vehicle when investment safety and reliable growth is paramount, and/or
- A reliable long-term savings vehicle when you have low tolerance for risk and portfolio value fluctuations.
| How much of your portfolio should be in guaranteed investments? |
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Most investors’ portfolios are comprised of a combination of guaranteed investments and equities such as segregated funds or mutual funds. The balance between guaranteed investments and equities depends on your:
- financial situation,
- risk tolerance, and
- investment goals.
A well-known formula to determine the right balance for you is to align the percentage of guaranteed investments in your portfolio with your age. Of course, this formula is simply a guide. Depending on your individual circumstances, a higher or lower percentage of guaranteed investments may be appropriate. Talk to your advisor about the right balance for you.
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| Here’s how the well-known formula for determining your portfolio balance might work
If Robin is 55 years of age, 55% of his investment portfolio would be comprised of guaranteed investments, which could include several guaranteed interest accounts with varied maturity dates, with or without a daily interest account. The remaining 45% would be invested in equities. As Robin gets older, he may choose to proportionately increase the guaranteed interest portion of his investment portfolio to maintain the same portfolio balance of guaranteed investments and equities into his retirement years. And, if Robin opts to divide his guaranteed investments into several different terms spread across a number of years, he will have the added security of:
- Interest rates on various terms averaging out over time, and
- Reduced overall portfolio risk with maturities spread out over a number of years.
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| Competitive interest rates |
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Interest rates are always an important consideration when choosing your guaranteed investment. Your advisor can confirm that Manulife guaranteed investments provide some of the highest rates available. | |
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Investors who choose the Manulife Investments Guaranteed Interest Contract (GIC) realize all of the benefits of a guaranteed investment as outlined above. In addition, investors automatically receive benefits only available from insurance company investments, such as:
These benefits are unavailable through banks, trust companies and mutual fund organizations.
In addition, the value of your investment in a Manulife Investments GIC is protected by third party insurance. Assuris (formerly known as CompCorp) insurance protects your investment in the case of insolvency, up to specific limits. For more information about Assuris (formerly known as CompCorp) protection, please visit their Web site at www.assuris.ca.
| Cashability |
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Unlike most guaranteed investments from banks, trust companies and mutual fund organizations, most Manulife Investments GIC are fully or partially cashable at any time. (Surrender charges may apply on terms cashed before maturity).
| Why are estate planning advantages important? |
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Manulife offers several distinct estate planning advantages over non-insurance institutions, beginning with the ability to name beneficiaries on registered and non-registered plans.
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| Here’s how a couple might use the estate planning advantages available
Terry has named his wife, Connie, as his beneficiary. At the time of Terry’s death, the current value of his Manulife Investments GIC -- including accumulated interest -- goes directly to Connie. Because the money will therefore bypass the estate, Connie can avoid the expense and delays of probate fees, legal fees and surrender charges.
As Terry’s spouse, Connie can also choose to have the value of Terry’s investment transferred directly to her own RRSP or RRIF at the time of Terry’s death, privately and without tax implications. | |
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| What about creditor protection? |
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When you name a “family class” or irrevocable beneficiary, your Manulife Investments GIC is generally safeguarded from creditors under provincial insurance laws that protect the investments of insurance company clients only.
In all provinces except Quebec, the annuitant’s spouse, child, parent or grandchild are all recognized as family class beneficiaries. In Quebec, family class beneficiaries are the policy owner’s spouse and/or descendants and ascendants.
The creditor protection feature is particularly useful for small business owners and professionals, as added security in case of bankruptcy.
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| Here’s how a small business owner might benefit from creditor protection
Joe owns and operates a small business and has built up sizable personal savings outside of the business to provide for his family. Joe would like to be sure that his personal savings are as secure as possible. By opting to invest his personal savings in a Manulife Investments GIC and naming his wife as beneficiary, Joe benefits from the potential creditor protection available only through insurance companies.
Ask your advisor or legal representative for details on how designating a family class or irrevocable beneficiary could potentially enhance your level of security against creditors. | |
| Non-registered savings plan benefits | |
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| You can save or defer taxes on your non-registered GIC. Policy year tax reporting allows you to delay paying tax on interest earned for up to one year; in addition, you may qualify for an annual $1,000 pension income tax credit if you’re 65 or older. | |
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MLI GIC Investments
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MLI
INVESTMENTS GIC |
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GIC
Accounts
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