Real Income protects your standard of living by increasing your annual income with the rate of inflation.
Real Income gives you predictable, stable income that won’t change with the market.
Real Income uses a scientific approach to reduce the chance you will outlive your money.
Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.
“Inflation-adjusted income”, “annual income”, and “Real Income Withdrawals”, as used herein refers to the amount received through a systematic withdrawal plan that, in the second year of investment and each year thereafter, automatically increases (or decreases) on January 1st based on the Bank of Canada’s reported 12-month change in the seasonally adjusted Canadian CPI, as at November 30th of the previous year. For Sentry Real Income Managed Portfolios, the withdrawal amount is determined and initiated by the fund; for Sentry Real Income Custom Solution, the withdrawal amount is determined and initiated by the financial advisor. The income, in both cases, can be a combination of capital appreciation and income, as well as the original principal.
Sentry Real Income Managed Portfolios are generally designed for those investors born between the years specified in the simplified prospectus and may not be optimal for investors outside of those age ranges.
Although designed with a high degree of probability, the longevity of assets and the Real Income withdrawals are not guaranteed. If redemptions exceed what the portfolio is earning, investors will eventually deplete their original investment and they will no longer receive income.
The confidence level component offered by the Sentry Real Income Managed Portfolios and Sentry Real Income Custom Solution determines the probability that the capital and investment growth will provide stable, inflation-adjusted income through retirement. The length of retirement is defined using a predetermined age for the Sentry Real Income Managed Portfolios, while the Sentry Real Income Custom Solution also incorporates longevity probabilities from Statistics Canada mortality tables.
The confidence level is determined using historical volatility and correlations of each asset class, which were used to forecast returns and volatility, on a real (inflation-adjusted) basis. For the Sentry Real Income Managed Portfolios, the forecasted returns and volatility, along with an initial income level for each purchase option birth year, were used to generate 1,000 simulations of potential outcomes over time. The initial Real Income Withdrawal amount for each purchase option birth year was chosen in order to provide a 95% probability (95% of the 1,000 simulations) that the inflation-adjusted income, would last to, and through, 90 years old. For the Sentry Real Income Custom Solution, the forecasted returns and volatility, along with the initial Real Income withdrawal amount are used in conjunction with longevity probabilities derived from Statistics Canada mortality tables, to determine the confidence level. The probability of payments lasting decreases with each subsequent year beyond age 90.
The confidence level is determined at the time of purchase and will fluctuate due to various factors including market events, investor activity and unforeseen circumstances. This fluctuation can increase or decrease the likelihood that the invested capital may be depleted prior to or after the determined age.