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Kesho Hela Income Drawdown Fund
Maximize on your returns as an investor & pensioner.
What is Kesho Hela Income Drawdown Fund?
This is a product that gives pensioners an alternative to the annuities, where the retiree is able to draw down on their pension while their residual is still being invested.
Annuities are issued by insurance companies whereas an income drawdown fund is established as a registered Trust under the same governance and legislative framework as that of a registered retirement benefits scheme.
Structure of the Fund.
In line with RBA regulations, Kesho Hela has appointed service providers to provide safe custody of funds, investment of funds and a corporate trustee services.
The appointed service providers are as following:
Corporate Trustee
Fund Managers
Scheme Custodian
Administrator
How it works
To join the Fund, a member will be required to complete an Application Form and to acknowledge having understood the rules and terms of the Fund .
Enwealth shall provide an annuity projection/benefit quotation showing the monthly pension equivalent of the member’s retirement lumpsum and a future projection of the members account.
Member shall choose the frequency of payment of pension– either monthly/quarterly/annually/semi-annually.
Funds are invested & the accrued income ploughed back to members account. The member will receive a copy of their statement on an annual basis.
Minimum drawdown period is 10 years after which member shall decide if to continue with the drawdown or purchase an annuity or take the full lump sum.
Registration & Governance of the Fund
The fund is established as a trust and separate legal entity from the founding company Enwealth Financial Services Limited
The scheme is registered and regulated by the Retirement Benefits Authority and Kenya Revenue Authority.
The fund assets are held by the appointed custodian and separated from the assets of the founding company enhancing the security of your retirement nest egg.
The fund assets are invested by the appointed fund manager who is Licensed by the Retirement Benefits Authority.
The fund has an appointed Corporate Trustee who is independent from Enwealth Financial Services Ltd and watches over the operations of the scheme on behalf of the members.
Benefits of the Kesho Hela Income Drawdown Fund
Investments that are moved into the income draw down are tax exempt as opposed to one who may decide to take the lump sum, as they will be taxed according to the prevailing tax rate for the different amounts.
You get to decide how you want your funds to be invested in terms of risk (low risk, medium to high risk). You also have a choice as to when you would like to receive your funds i.e. beginning of the month, mid-month or on a quarterly basis.
Investment income allows you to enjoy continuous investment income whilst drawing on their funds.
The income draw down cuts to the heart of the matter, giving value for your money and making sure that you have a comfortable and progressive retirement life.
Most members do not prefer insurance companies therefore the income draw down provides a choice for them to opt out of the annuities.
Annuities priced at 2% net of interest rate: Income draw down is less expensive as compared to the annuities.
Frequently Asked Questions
How do I join?
The member will have a session with financial consultant who will take the member through the product and based on the amount transferrable generate a projection of earnings.Â
When the member is okay with the projection, he/she will fill an application form, a nomination of beneficiary form and sign the projection.
Who is eligible to join?
Members who have reached retirement age are eligible to join the income draw down fund.
What happens in the unfortunate event of death?
On the death of a member, the funds will be used to provide an income to the nominated spouse(s) and/or the dependent children either by purchase of an annuity or a continuation of an income drawdown plan to the dependents. Otherwise it shall be paid to the nominated beneficiaries or dependents.
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