As you know, the Helios2 contract offers 5 fee options to owners. For options B (low load sales charge) and C (deferred sales charge), fees apply when you make a withdrawal in accordance with the calendar in the
Contract and information folder. However, this administrative rule stipulates that you will not incur any withdrawal fees up to 12% of the value of your Units in each fund. The following excerpt details how to calculate these fee free units:
Excerpt from the Contract and information folder document – November 2021
Fee options B and C
No withdrawal fees for up to 12% of the value of your Units of each fund
During a calendar year, you have the right to withdraw up to 12% of the value of your Units in each fund that are still subject to withdrawal fees without incurring any fees.
For the first year of your contract, this 12% is adjusted in proportion to the number of months between the deposit date and the end of the calendar year.
For the following years, we calculate this 12% based on the value of your Units on the last valuation date of the previous calendar year.
If you make additional deposits during the year, we recalculate the eligible amount while taking into account the value of the new Units attributed to your contract in proportion to the number of months between the deposit date and the end of the calendar year.
For example:
Year 1
- You apply for a contract on February 1. We attribute Units to your contract in the funds you’ve chosen: fund 1 and fund 2.
- During the year, you can withdraw up to 11% of the market value of the Units in each fund without incurring any fees (11 months left before the end of the year).
- On December 31, your fund 1 Units are valued at $30,000 while your fund 2 Units are valued at $20,000.
Year 2
- During the year, you can withdraw up to 12% of the value of your Units in each fund on December 31 of the previous year, without incurring any fees. You can therefore withdraw $3,600 for fund 1 ($30,000 X 12%) and $2,400 for fund 2 ($20,000 X 12%).
- You withdraw $5,000 from fund 1 Units and $5,000 from fund 2 Units on October 1.
- You must therefore pay fees on $1,400 for fund 1 ($5,000 – $3,600) and $2,600 for fund 2 ($5,000 – $2,400).
- You must also pay fees for any other withdrawals made between October 1 and December 31.
If you don’t make any withdrawals in a given year, you cannot carry the 12% exemption forward to another year (meaning, you can’t withdraw 24% during the following year without incurring any fees).
Therefore, following the
replacement of our system, we inform you that this administrative rule is now in effect as planned, meaning that the amount of fee free units is available per fund and cannot be transferred from one fund to another. Formerly, the amount of fee free units was determined on a contract basis, not by fund.
We are aware that this may lead to changes in the way you do business and we thank you for your understanding. This change affects the Helios2 contract only. The other versions of the contract (Helios, Millennia III and Imperial Growth Plan) are not affected. Please contact us if you have any questions or to let us know if you encounter any problematic situations during this transition.
Questions?
Contact us.
1-877-647-5435
gifclientservice@dfs.ca
Client Service, Savings
