Are Investment Shares safe?
Yes. They are low-risk investments.
Are Investment Shares guaranteed?
Investment Shares are considered capital investments in the credit union and are not guaranteed through the Financial Services Regulatory Authority of Ontario (FSRA) or any similar public agency.
Kindred is a solid financial cooperative with a decades-long track record of sustainable growth and prudent fiscal management. Kindred has declared a dividend on the current series of Investment Shares every year since 2005, even in the midst of the financial crisis in 2007 – 2008. Similar to corporate bonds, investment shares are backed by the credit worthiness of the issuer – in this case, Kindred. And based on our track record, you can have full confidence in Kindred’s stability and solvency.
Are there any eligibility requirements or restrictions?
You must be a Kindred Member to purchase Investment Shares. If you aren’t a Kindred member, you can purchase Investment Shares by becoming one. Learn more about Kindred Membership. The minimum age to subscribe to Investment Shares is 18.
Investment Shares are available as non-registered, RRSP, and Tax-Free Savings Accounts. Investment Shares are not available as RDSPs, RESPs, or RRIFs. In order to help our members to manage their cash flow in retirement, or as they near retirement, Investment Shares will not be available within RRSPs to members turning 66 on, or before September 30, 2022.
Investment Shares can be held in registered plans. However, RRSPs must be converted to income accounts (i.e., RRIFs) by the end of the year in which the members turn 71 and Investment Shares would not allow for this. Members age 66 and older can subscribe to Investment Shares that are non-registered or within a TFSA.
How is the Dividend Rate calculated?
The dividend formula is the monthly average of the Government of Canada 5-year benchmark bond yield plus 1%.
What types of investments are Shares available in?
Investment Shares are available as non-registered, RRSP, and Tax-Free Savings Accounts. Investment Shares are not available as RDSPs, RESPs, or RRIFs.
Is there a minimum or maximum investment amount?
The minimum investment is 5,000 shares or $5,000 and the maximum is 800,000 shares or $800,000. These limits are relatively standard in the industry for an investment product of this nature. Investment Shares require more administration than a standard GIC, so a higher minimum investment is necessary.
What type of investor is best suited for Investment Shares?
- Those who are comfortable with at least a 5-year commitment.
- Those looking for an option for the low risk portion of their portfolio that is not subject to market volatility.
- Those who will not need to access income from their RRSPs or borrow from their investments to help finance their first home, for instance.
- Those who are looking to make an impact by supporting Kindred while also earning a premium rate of return.
Can I break an existing GIC in order to subscribe into Investment Shares?
GICs that have been setup or will be maturing in 2022 are eligible to be redeemed early without penalty in order to purchase the 2022 Series of Investment Shares.
What’s the difference between a GIC and Investment Shares?
Investment Shares are considered capital investments in the credit union and are not guaranteed through the Financial Services Regulatory Authority of Ontario (FSRA) or any similar public agency.
How are dividends on Investment Shares paid to members?
Due to the nature of the Investment Shares, the ‘dividend’ is treated as interest income for tax purposes, similar to a GIC. Members can choose to have their annual interest compounded or paid out in cash on an annual basis. For RRSPs and TFSAs, the amount must be paid as additional shares.
Kindred issued Class B Investment Shares to members in 2022, 2019, and 2005. As shareholders request to sell their shares, they become available for purchase by other members. If you’re a Kindred member interested in purchasing Investment Shares, let our Wealth and Investment Team know and we’ll get in touch!
