The first step of our solution has been launched with the introduction of a cost of retirement Index, co-developed with Invesco, using a curated portfolio of U.S. Treasury Securities, all of which are backed by the full faith and credit of the United States. The Invesco/A&P Capital Retirement Income Index offers investors a new, transparent way to benchmark the current cost of generating 30 years of assured income, using highly liquid securities. The Index’s value reflects today’s all-in cost to acquire $1 of income every year for the next 30 years. This makes it easy to translate retirement savings into a reliable 30-year income stream—simply divide the savings amount by the Index’s valuation on any given day to determine the current annual income potential over the next 30 years.
This Index can be replicated by an Index-tracking fund, delivering 30 years of assured income of $1 per share (barring U.S. Treasury default, and with reinvestment of any distributed income), with payments starting whenever the investor chooses through a related payout fund. The annual income payments of $1 per share are unaffected by changes in interest rates or other market variables: simply knowing the number of fund shares currently held determines the annual retirement income provided by the fund.
In contrast with annuities, our index fund will offer investors the flexibility to alter shareholdings on an intra-day basis, and thus to change assured income, reflecting the liquidity and capacity of the US Treasury markets. Beyond the index replicating fund, A&P has developed further allocation strategies that combine active equity management with assurance of increasing annual retirement income per share, regardless of interest rate or equity value fluctuations.
This Index can be replicated by an Index-tracking fund, delivering 30 years of assured income of $1 per share (barring U.S. Treasury default, and with reinvestment of any distributed income), with payments starting whenever the investor chooses through a related payout fund. The annual income payments of $1 per share are unaffected by changes in interest rates or other market variables: simply knowing the number of fund shares currently held determines the annual retirement income provided by the fund.
In contrast with annuities, our index fund will offer investors the flexibility to alter shareholdings on an intra-day basis, and thus to change assured income, reflecting the liquidity and capacity of the US Treasury markets. Beyond the index replicating fund, A&P has developed further allocation strategies that combine active equity management with assurance of increasing annual retirement income per share, regardless of interest rate or equity value fluctuations.