Pro-Guaranteed Income Funds are segregated funds that offer Guaranteed Minimum Withdrawal Benefits. If you are 65 years or older, you can guarantee an income stream for life based on 5% of your lump sum contribution – no matter what happens to the market.
If you are younger than 65, you can secure a 5% income stream for a minimum of 20 years AND when you turn 65 you will have the option to switch to the lifetime income stream.
For example, if a 65 year old contributes $100,000 to one of these funds, the absolute worst case scenario is that they will receive an annual income of $5,000/year until they die – even if the market only went down forever.
On the other hand, if the markets perform well, it is possible that your income stream can increase. But it can never go down.