Annuities are something that people know are out there, may know a little about the basic framework but don’t know much more than that.

Let’s dive into them for a moment before we go into:

  • Recap of podcasts
  • Annuities
  • Market overview
  • Using segregated funds for creditor protection

Recap of Podcasts: and are also available on iTunes, Spotify, Google Play and Stitcher

  1. Introduction of – Check out the bio film about me on the website!
  2. Leaning on resources – how to move quickly and bring in other team members to your finances.
  3. Estate planning and your portfolio
  4. Real Estate Opportunity
  5. Individual Stocks vs Funds
  6. Hedge Fund Strategies: Market Neutral
  7. Hedge Fund Strategies: Merger Arbitrage


Annuities are an insurance product that guarantees a stream of cash flows.

Basically you pay a lump sum once upfront and then the insurance company will pay a predetermined amount every month. There are annuities which you can pay into over a number of years but we’ll use the lump sum version in this illustration.

Your age and gender is a factor and if it is joint with your spouse their age and gender will be a determining factor too. 

These variables will affect how much income you can generate from the upfront payment (called a premium). The older you are, the less time the insurance company will have to pay the funds and as a result will provide more beneficial rates. This reduces their risk.

Should you invest all of your money in an annuity? Usually no.

Financial planning would dictate that you would use an annuity to cover off your required expenses. This acts like a bond portfolio.

Growth and inflation can be factored in through a holding of stocks. If you want the estate benefits of an insurance policy then segregated funds might be a good way to go however if that is not a concern, and neither is creditor protection, then the growth and inflation can be gained through other avenues such as direct holdings in stocks, ETF’s and mutual funds.

Will you lose all of your money if you die? You can often set up a survivor with an annuity and also have a death benefit so that remaining funds will be paid to a beneficiary.

Do you have questions about annuities? Give me a call.

Market Overview:

The tale of two markets continues with the Canadian TSX (up 0.15% in July) lagging the US S&P500 (up 1.31% in July). Both markets had sell-offs on the last trading day which suppressed returns for the month. Economically speaking the data this month continued to push the importance of a US strategy.

Major concerns remain to be trade uncertainty and tariffs that may hit corporate earnings more and that it causes business investment to continue to hold back. Corporate expected earnings had been adjusted downward and as companies continue to report, many are beating the lower bar that has been set for them. Many of the trade uncertainties have been priced in until a newsworthy event moves the markets.

This month the US Central bank lowered rates as expected by 0.25% as an insurance policy against soft international economics but indicated that it was happy with the progress of the US economy. I can’t help but feel that this was largely due to pressure from the markets and the US president as the clash of personality and strategy differs between Trump and Powell. The Canadian central bank is resisting making a similar move and as a result is causing the Canadian dollar to get stronger relative to the US dollar. 

Expectations were for more US rate cuts and now that is being adjusted and repriced in the markets which is causing the US dollar to strengthen as of the beginning of August.

Interestingly interest rates on the 10 year government bonds in the US, Germany and the UK have all seen declines in yield while Canada actually had a rise in bond yields in July.

Looking at the desired profit range for mortgages I believe that mortgage rates are likely to hold where they are and if they move the bias would be to an upward move in rates. This can of course change at any time and if bond yields decrease then this would leave room for rates to decrease, although I’m not expecting this to happen at current time.

Creditor Protection and Estate Benefits of Segregated Funds:

Sometimes people get sued. People will eventually die.

Do you have a family member who is looking to simplify their estate process and have funds flow to beneficiaries?

Segregated funds are an investment and many options are available from bond to stock to balanced funds.

They are an insurance product without the medical considerations. 

When someone dies the money moves to the beneficiary because even for non-registered accounts a beneficiary can be named.

If you are sued, this acts as an insurance policy and would not be seizable in a court order.

Have questions about segregated funds and if they would help you out? Give me a call?

Take Aways:

  1. Check out
  2. The markets have a tendency to act irrationally
  3. I am sticking by my US investment strategy
  4. Expectation of interest rates in Canada to hold steady for a while
  5. Think of your finances from a wealth perspective and think about them from an investment side, taxation side and LEGAL side

Trevor Dale is licensed to discuss and deliver on solutions for investments, insurance and mortgages. Give us a call for a free consultation.

The podcast can be found on iTunes, Spotify, Google Play and Stitcher.

Until next time.

Trevor Dale, CFA