Catherine Donnelly, associate professor at Heriot-Watt University and a fellow at the Institute and Faculty of Actuaries, is a proponent of the vehicles. “Anyone who works on them says, ‘Why wouldn’t you be offering them?’” she says. Tontines address the issue of people not knowing when they will die whilst also not being interested in buying annuities – something referred to as the ‘annuity puzzle’, says Donnelly.
You wanted the 'Perfect Pension' so we built it
Consumers want a 'perfect' pension that offers:
- a lifetime income that can never run out,
- which increases over time to offset inflation,
- it is safe and transparent, and
- the fees are kept low.
Our platform enables this perfect pension based on a proven design known as a 'Tontine' (🔈 tonn-teen).
Once you understand Tontines, you will know why for centuries they always attract more savings than any other pension product.
Why we started this organisation
When you reach retirement, you face what Nobel Prize winning economist Bill Sharpe describes as “the nastiest, hardest problem in finance”.
That problem is: How much can you spend every month without risking that your money will run out?
84% of savers want to solve the problem by securing a lifetime income but existing solutions just don't work.
The simple answer is to join a 'Tontine' which pays a monthly income for life that can be expected to rise over time.
This is why we started TontineTrust: to create the safest, most trusted & best value-for-money lifetime income pension in the world.
TontineTrust is the world’s first “RetireTech”.
Our Platform allows consumers to create their own 'DIY' pensions and know with extremely high precision what their level of lifetime income in retirement will be.
Behind the scenes, our engineers use state of the art technology, applied mathematics and machine learning to make the safest, most trusted pension in the world.
But our members don't need to worry about any of that, they don't need to worry about running out of money & they don't need to worry about the financial markets.
Once a member joins, she becomes a 'Tontiner' & the best way to get the most out of her pension is start taking better care of her health.
What do the experts say?
Tontine Trust & Tontines are receiving more & more endorsements from Financial Scholars, Institutions & the Financial Media
A Tontine resembles a simple low-fee annuity with lifetime payments. Yet unlike an annuity….a Tontine can pay a higher yield because of its relative simplicity of structure.
Love the idea of tontines. They solve so many problems for retirees. These guys are bringing them back... super interesting.
Mortality credits enables investors to earn a type of guaranteed “alpha” not available in any other asset class. As you age and your mortality (risk) increases (e.g. 10% at age 80) then you are effectively earning this as a rate of return.
Tontines pose less risk to members than conventional annuities since there is no contractual obligation on payout, no counter-party risk and no need for insurance-company reserves.
Considered as a life-cycle asset, [a tontine] proved to be an excellent investment, earning a rate of return substantially in excess of that generally available on other assets.
(Annuities) are relatively expensive because their issuers must hold a large capital buffer. Retired people tend not to like them as they pay a low rate. Tontines are simple to understand and could be much less costly than annuities because the risks are not taken onto the balance-sheet of an insurer.
You get thrown 30-, 40-, 50-page documents explaining some kind of annuity using this particular background, and 12 different kinds of investments that feed into it, and your eyes gloss. By comparison…the tontine is unbelievably simple — you can explain it in two pages.
The Tontine: A 17th Century Solution to a 21st Century Problem…….. What is insurance except a pool of people coming together to share risks? What better product for our era than a crowd-sourced, peer-to-peer, sharing economy life insurance solution.
Tontiners in the News
We are increasingly featured in major financial / pension publications & TV channels including:
Frequently Asked Questions
When someone joins a tontine, they invest whatever portion of their savings that will allow them to relax & sleepy easy knowing that they will receive a suitable level of income for the rest of their life.
BUT, the rule of a Tontine is that if someone dies, they no longer need the monthly income.
So if a member dies within a few years, even before they have received payouts in excess of their original contribution, then their remaining payouts will be shared among the surviving members of that pool.
These 'tontine credits' received by surviving members from members that have passed away enable the tontine to continue paying monthly incomes to even the very longest lived members.
As we say, like pets, Tontines are for life, not just for xmas.
Tontines are a great way to help you take care of your children financially.
With existing pension products, your children have to wait until you pass away to see if there is any money left over.
In a Tontine, you can use some of your savings to secure an appropriate level of lifetime income for you and your spouse, then you can immediately pass on some of the balance to your children.
In a Tontine, the assets are held in trust for the members. The trust has no liabilities and is not allowed to engage in any borrowing.
As such, the capital is safer than if it is placed on the balance sheet of an institution which faces financial & operational risks such as a bank or insurance company.
Additionally, recent Irish case law confirmed that in the event of a person (for example an Entrepreneur) being declared bankrupt by their creditors, their lifetime income from the trust is protected.
In the past, pension schemes would promise you exactly what they would pay you when you reached retirement. The problems started when people started living longer & interest rates went down, making it almost certain that they will break their promises to those that live a long time.
In a Tontine, the Trustees make constant ongoing micro-adjustments up & down to the future payouts always making sure that there will be enough money left for all of the members.