When someone joins a tontine, they invest whatever portion of their savings that will allow them to relax and sleep easy, knowing that they will receive a suitable level of income for the rest of their life. BUT, the golden rule of a tontine is that if someone dies, they no longer need the monthly income.
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Therefore, if a member dies within a few years, even before they have received payouts in excess of their original contribution, their remaining payouts will be shared among the surviving members of that pool.
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These 'tontine credits' received by surviving members from members who have passed away enable the tontine to continue paying monthly incomes to even the very longest-lived members.

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Tontines are a great way to help you take care of your children financially now without them having to wait until you die.

With existing pension products, your children have to wait until you pass away to see if there is any savings left over.

In a tontine, you tontinise some of your savings to lifetime incomes for you and your spouse now and then you can immediately gift the balance to your children to help them to pay university fees, buy a house or start a business.

In doing so, you also remove the risk that you will become a financial burden to your children later because you will have already ensured you can never run out of money.

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In the past, pension schemes would state your payout when you reached retirement. But then people started living longer, and interest rates went down.

This made it almost inevitable that many 'Defined Benefit' schemes would have to break their promises if they were to avoid bankruptcy.‍

In a tontine, by contrast, the trustees make constant ongoing micro-adjustments to the expected future payouts.

This ensures that there will always be enough money to maintain the lifetime income payments.‍

Furthermore, the very fact that the trustees have the ability to vary these future payments means that the pension fund is not compelled to invest only in government bonds offering close to zero interest. Instead, they can diversify into other types of investment, such as long-term infrastructure funds, which are capable of providing a far higher level of income for the pension scheme members.

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In a tontine, the assets are held in trust for the members. TontineTrust 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 that faces financial and operational risks, such as a bank or insurance company.
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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. The last major industry-wide insurance sector collapse happened 150 years ago in the US when almost every insurance firm was wiped out. The only survivors of this 'extinction event' were those operators also involved in the tontine pensions industry.

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The trustees ensure that all of the monies in held in trust for the members in a segregated account at a custodian bank or depositary bank.

The monies can only be invested in accordance with the Pensions Act, which is based upon the European pension scheme directives. Our pension scheme rules go one step further, however, by adhering to the new investment standards set down by the EU PEPP Regulations.

These stipulate that the majority of the scheme assets must be invested in regulated investments with a strong emphasis on infrastructure and ESG compliant investments.

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The word tontine has two syllables and is pronounced as "tonteen".

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