MANAGING YOUR CASH IN RETIREMENT

Transcription

1 MANAGING YOUR CASH IN RETIREMENT First Mortgage Trust Group Investment Fund & First Mortgage PIE Trust

2 Managing Your Cash in Retirement Now you have reached retirement age, it's time to reax and enjoy the rewards of your abours. You have paid off your mortgage, your chidren are independent, and you have saved a tidy sum of money which wi suppement your Nationa Superannuation and aow you to enjoy a comfortabe ife. But, wi your savings be enough? In many countries, retirees purchase annuities to hep fund their iving expenses once empoyment reated income ceases. The purchaser pays a certain capita sum to guarantee a certain income for the remainder of his or her ife. Annuities have not been popuar in New Zeaand because they are tax inefficient. Income derived from an annuity is taxed at the rate of 33 cents per doar where a retiree's income may often ony be taxed at 17.5 cents per doar.

3 Because annuities in New Zeaand are tax inefficient, First Mortgage Trust has identified the need for a financia product which sti provides reguar cashfow, but with the benefits of the ower tax rate regime which may be provided by a Group Investment Fund or a PIE (Portfoio Investment Entity) Fund. So how can First Mortgage Trust hep manage your cash in retirement? You can invest your funds in First Mortgage Trust Group Investment Fund or First Mortgage PIE Trust according to your own particuar tax circumstances. We suggest you consut your professiona advisor to ascertain which fund is best for you. Our current Product Discosure Statements covering both of these funds provide the information required to compy with the provisions of the Financia Markets Conduct Act 2013, aong with an investment Appication Form. Our Product Discosure Statements can be obtained on request or from our website. On a reguar basis (we suggest at east annuay), we invite you to visit our website Cick on "Managing Your Cash in Retirement", and use the simpe cacuator provided to assess or reassess your position using the foowing steps:

4 (a) Enter the sum of capita you may wish to manage in this way. (b) Enter the rate of return you expect First Mortgage Trust to be paying during the next year. This rate wi vary according to market conditions. (c) Enter an anticipated infation rate (e.g. CPI increase). (d) Enter the amount you woud ike to withdraw monthy and have paid automaticay to your nominated bank account. (e) Enter your anticipated tax rate. The cacuator wi show approximatey how ong it wi take to consume your origina capita investment (see sampe on the foowing page).

5 A sampe cacuation is reproduced beow: Initia Sum: $100,000 Return: 4.85% Infation: 3.00% Monthy withdrawa: $500 Tax Rate: 17.50% Opening Net With- Cosing Year Baance $ Interest $ drawas $ baance $ 1 100,000 3,951 6,000 97, ,951 3,864 6,180 95, ,635 3,767 6,365 93, ,036 3,658 6,556 90, ,137 3,536 6,753 86, ,921 3,402 6,956 83, ,367 3,254 7,164 79, ,456 3,091 7,379 75, ,168 2,913 7,601 70, ,480 2,718 7,829 65, ,369 2,506 8,063 59, ,811 2,276 8,305 53, ,782 2,026 8,555 47, ,254 1,756 8,811 40, ,199 1,456 9,076 32, ,588 1,151 9,348 24, , ,628 15, , ,917 6, , ,193 0 This sampe shows a capita sum of $100,000 being consumed in 19 years.

6 What are the Benefits you receive from investing in First Mortgage Trust's "Managing Your Cash in Retirement"? You wi receive reguar cashfow to suppement your iving expenses. It is reativey simpe to understand. It may provide tax efficiency via either First Mortgage Trust Group Investment Fund or First Mortgage Trust PIE Trust. There is no estabishment fee. You have security in the knowedge that the funds are secured by first registered mortgages over and and buidings in New Zeaand with reativey conservative Loan to Vauation Ratios. Your investment is supervised by an independent icensed supervisor. You may request that the arrangement may be varied or terminated at any time. What must I do now to join First Mortgage Trust's "Managing Your Cash In Retirement" pan? Simpy compete the form on the foowing page (and an investment Appication Form if you are not a current investor).

7 Notes

8 To: First Mortgage Trust I/We (fu name) of (address) (Compete either paragraph (a) or (b) and strike out whichever option is not appicabe) (a) attach a competed investment Appication Form (which may be found at the rear of our Trusts' current Product Discosure Statements) to invest the sum of $ in: First Mortgage Trust Group Investment Fund or First Mortgage PIE Trust (deete that which is NOT appicabe) OR (b) aready have an investment of $ in First Mortgage Trust Group Investment Fund or First Mortgage PIE Trust (deete that which is NOT appicabe) I/We wish to participate in your "Managing Your Cash in Retirement" pan. Pease make reguar withdrawas of $ per month from my/our investment funds and deposit them on the 10th or 20th day of each and every month to my/our bank account at Account Number Bank Branch Account Suffix Account name or attach an encoded deposit sip I/We understand that I/we may vary or cance this instruction at any time by giving notice in writing not ess that 2 cear business days prior to the next schedued withdrawa. Dated: day of 20 (signed)

9 15 First Avenue PO Box 13083, Tauranga 3141 New Zeaand Phone: or MANAGING YOUR CASH IN RETIREMENT 15/10/15 First Mortgage Managers Limited is icensed under the Financia Markets Conduct Act 2013 as a manager of registered schemes.