Shine for retirees

Equity savings funds invest about a third of the money each in equity, debt and arbitrage opportunities (a strategy where the fund aims to profit from temporary price differences between related securities across markets). This setup lets you tap into the growth of equities while cushioning you from market drops. What's more, with over 65 per cent of the money in equity and arbitrage, these funds qualify for equity taxation, giving you growth potential with steady debt-like stability, all wrapped up in a tax-friendly package. Are these funds right for you? If you're a conservative and low-risk investor happy with moderate equity exposure or retirees seeking regular income, equity savings funds can be a good fit. Highlights & trends Performance: This year, these funds almost matched the 11 per cent returns delivered by the market. However, retirees enjoying strong returns should limit their withdrawals to 6 per cent annually. This ensures that excess returns stay invested, acting as a cushion during lean periods and preserving long-term savings. Continued traction: Despite the funds being relatively unknown com

This article was originally published on December 15, 2024.