| Illustrator Help |
|
|
| Product Help |
|
|
|
| Introduction |
|
This BMO Income Generator Illustrator illustrates the income stream available
from non-registered savings. To learn how much monthly income your savings can
generate, or how much is needed to invest to meet monthly income needs over the next
five years, simply enter the information requested in the required fields.
|
| Investment Information |
- Initial Investment Amount: The minimum initial investment amount is $10,000.
- Monthly Income Payment: The monthly income payment amount can be made up of
any portion of interest and/or principal. The total of the monthly income payments over the
term of the investment cannot exceed the principal value of the investment.
|
| Terms & Definitions |
- Amount Invested: The original principal amount of the investment.
- Monthly Income Payment Amount: The dollar amount of the monthly
income payment that is desired.
- Percentage of Initial Investment Paid As Income (over the 5-year term):
The total of all of the monthly income payment amounts expressed as a percentage of
the initial amount invested, for the entire term. For example, if Amount
Invested = $200,000 and ‘Percentage of Initial Investment Paid As Income’ = 20%,
and you would like a total of $40,000 in monthly income payments over the 5-year term.
- Total Interest Earned Over the Term of the Investment: Sum of monthly
interest that will be earned over the term, as provided by the illustrator.
|
| Overview |
|
BMO Income Generator
Perhaps you are looking to supplement your other sources of income to finance the lifestyle
you want, or maybe you are unsure what to do with a lump sum of money from an inheritance,
downsizing your home, or selling your business.
Based on your circumstances, you decide the amount of income from your investments you
need to receive, and the date you would like to receive it. These payments can go directly
to your account, or you can choose to direct the payments to someone else, for example, an
elderly parent, or a child at university.
The investment professionals at BMO Bank of Montreal will work with you to determine
how the BMO Income Generator can best meet your individual needs.
|
| Product Details |
| Currency |
Canadian Dollars |
| Term |
5-year term |
| Cashability |
N/A |
| Income Payment
Options |
Frequency: Monthly
Amount: receive customizable monthly income which may be comprised of both principal and interest.
Date of receipt: Selected by you or defaulted to the monthly anniversary of the purchase date.
Interest Income: Calculated daily and added to the principal investment on the day you receive your
monthly income, and at the date of maturity.
|
| Minimum Investment
Amount |
$10,000 |
| Registered plan
eligibility |
Not eligible |
| Available to
Commercial Clients |
Yes |
| Automatic
Re-investment |
Yes. You may opt to automatically renew your BMO Income Generator for a further
5-year term at the rate current at the time of maturity and with the same income payment amount (unless other
instructions provided). Exception: In the event that the income payment amount cannot be supported over the
full 60-month term, then the funds will be reinvested into a 1-year non-redeemable GIC.
|
| Rates |
The interest rate is unique to your purchase, and takes into account your monthly
income needs and current interest rates at the time of purchase. |
|
| Features & Benefits |
| Features |
Benefits |
| An Income Solution |
Pays a stable, predicable stream of monthly income and,
unlike traditional GICs, each equal monthly income payment may be comprised of interest
and principal in an amount customized to your cash flow needs. |
| Planning Flexibility |
Planning for the possibility of a 20 or 30 year retirement?
Arranging for, and reassessing your financial needs in 5-year increments is a simple
strategy with built-in flexibility
|
| Higher Returns |
The 5-year term allows you to earn the competitive rates normally
associated with a longer term GICs while receiving a regular stream of income. |
| Customization |
You determine the amount of income you’d like to receive from this
investment each month, and the date on which you’d like to receive it. And at maturity, you’ll
have several options: You can choose to have the remaining principal returned to you. Or,
have it automatically renew to generate the same monthly income stream at current interest rates.
Or choose to re-assess your income needs and change your monthly income stream.
|
| Security and Protection |
Your unpaid principal and interest are at all times unconditionally
guaranteed by the BMO Bank of Montreal and eligible for Canada Deposit Insurance Corporation (CDIC)
coverage up to allowable limits. |
| Options |
You can assign an alternate payee to receive the income payments,
for those times when you are paying the regular expenses for someone else, e.g helping out an
aged parent by supplementing the payment of their monthly expenses. |
|
| Client Scenarios |
| Putting BMO Income Generator to Work for You |
Scenario #1
Pam, 50, and mother Sheila, 74
|
“My mom, Sheila, recently suffered a health set back and had to give up her home and
move into a nursing home. Her existing income doesn’t fully cover her expenses. We’re
unsure of what to do with the proceeds of the sale of her home and she needs help
managing her monthly expenses. We want peace of mind knowing that her needs are being met.”
| Sheila’s Income Solution* |
| Principal Investment: |
$220,000 |
| Monthly Payment: |
$800 |
| Remaining Principal at end of 5-year term: |
$214,724 |
|
Scenario #2
George, 58
|
“I’m retired – and loving it! I’ve spent so many years working and saving; now I’m ready to get
the most out of this new phase in my life. I want to travel abroad…maybe motorcycle my way across
Europe. I have a $150,000 GIC maturing soon and I want to use this money to supplement my existing
income and explore new opportunities.”
| George’s Income Solution* |
| Principal Investment: |
$150,000 |
| Monthly Payment: |
$1,000 |
| Remaining Principal at end of 5-year term: |
$116,320 |
|
Scenario #3
Kevin aged 61, & Sarah, aged 60, business owners
|
"We have spent our lives building up our business - we’ve lived well and put our
children through university. We have always reinvested the profits back into
the business and haven’t invested a lot in RSPs over the years. We have a buyer
for the business and will be receiving a significant cash amount on closing, but
we are uneasy about not having a regular monthly paycheque."
| Kevin & Sarah’s Income Solution* |
| Principal Investment: |
$500,000 |
| Monthly Payment: |
$4,000 |
| Remaining Principal at end of 5-year term: |
$343,609 |
|
|
| Helpful Tools & Tips |
| The following tools are available to assist you in analyzing
income needs and to confirm risk tolerance for your clients.
Investment Tips
- Allocate a portion of your portfolio to a solution that provides you with a
guaranteed income, such as the BMO Income Generator. You will receive a steady stream
of monthly income while allowing the remainder of your investment portfolio to stay
invested for potential growth over the longer term.
- Consider setting up monthly income payment so that the date of the payment coincides
with any expenses that you wish to pay with these funds.
- The interest rate is unique to every purchase and is dependent on your income needs.
In simple terms, the interest rate will depend on a combination of:
- The amount of principal invested;
- The amount of the monthly income payment; and
- Current interest rates.
- Determining how much you need to withdraw from your investment to meet monthly
income needs can be simple. We can help you analyze your current monthly income and expenses
(current cash inflows and outflows) and set up an automatic solution that will help close the gap.
|
| Next Steps |
For more information:
- Drop by your local BMO Bank of Montreal branch
- Call BMO Bank of Montreal Direct Banking® at
1 877 CALL BMO (1 877 225-5266)
|
|
| close 
