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Hi: I've got 25,000 or so of Income Plus, the variable annuity that seems to be sinking Manulife's stock. My sister says that as a segregated fund its safe enough even if it goes under, and it would probably be difficult to ditch anyways. So - is it safe enough to hang onto. Seemed at the time to be a good anchor to my mutual stock & bond portfolio as i had several years to get the guaranteed gain.
 

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I was typing on an unfamiliar (French!) keyboard last night and could not make a detailed response to your post.

In re-reading your post this morning, I have a couple of questions for you.

Is $25K your total allocation to Income Plus? This is a very small amount - the guaranteed income from this small allocation will be very low.

Are you worried about the future of Manulife as a company? As I said in my earlier post, if ML goes under, its obligations would (theoretically) be transferred to a solvent company. This is what happened when Confederation Life fell in 1984, and not one annuitant lost one penny. (I say "theoretically" though because ML is huge and Assuris has not had to deal with a collapse on that level. However, I do not personally think ML will fail.)

Also, there is no "guaranteed gain" with Income Plus UNLESS you have deferred the income. I presume that's what you are talking about?

Finally - if you want to understand more about how these products work and how they compare and contrast to other product classes (stocks, bonds, annuities) - you might want to check out the book I just co-authored on product allocation. Details in my sig line, below. You should be able to pick up a copy at your local library; and I am great at answering questions.
 

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deferring payments

Yes, I only put in the minimum amount - I thought of it as an anchor but not a big money maker. (The 5% they advertised seems to be simple interest.) This was the amount I figured I could be sure of not having to withdraw for awhile. so, if it did better than the guarantee, well & good, if not, at least it was similar to a GIC. I'm 59, at 65 we could re-assess. But - the thought that the 25 thou could be at risk itself - no matter how little the income from it, that's not a cosy idea. We have other investments now - TDBond & Div. Equity funds mostly.

Thanks for the info and the lead to your book - Peebee
 
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