as life circumstances change
Give your clients the flexibility of fully customized income
Your clients’ income needs may change over time. During their working years, they may be looking to supplement their salary. And down the road, they could be looking for ways to supplement their income in retirement.
Why should they be limited to a fixed target annual distribution when they can add an element of customization? Designed with their evolving needs in mind, Franklin Templeton’s Series T provides tax-efficient income to adapt to clients’ changing lifestyles and needs.
With Series T, you can help clients…
Customize their income up to a maximum target annual distribution rate of 8%1
Plan for when they pay tax by deferring capital gains
Access a wide range of mutual fund solutions to align with their investment objectives
1.Maximum target annual distribution rate on Series T varies between 5% to 8%. Investors may choose their desired ROC cash payout rate and the remainder will be reinvested.
The benefits of Franklin Templeton’s Series T
Series T can provide clients with customizable, tax-efficient monthly income with several additional benefits:
High, predictable and immediate income that can be customized
Tax-efficient cash flow,
using return of capital (ROC), allows you to defer tax on ROC, making it more tax efficient than redeeming your investments
Tax Planning
clients can have more control over when taxes are paid on capital gains
Capital preservation
more money stays invested for long-term appreciation potential
Choice
there are many Series T solutions to meet clients’ varied investment goals
Did you know?
Franklin Templeton’s Series T offering includes funds that can provide monthly income in U.S. dollars, an attractive feature for clients who spend a lot of time in the U.S.
Series T: How does it work?
Monthly ROC distributions from Franklin Templeton’s Series T include income generated by the underlying securities as well as possible ROC component, which is a top-up, if necessary, to meet the annual cash flow target. The ROC component is not immediately taxable, allowing for the deferral of capital gains taxes.
Franklin Templeton’s Series T is a key strategy that will give clients immediate, tax-efficient income today while offering the opportunity for future growth.
The objective is simple: Reduce current taxes and have more money for retirement and other life goals.
Two easy steps to customized income
- Work with your client to set the most appropriate income level for current needs The target annual distribution rate ranges from 5% to 8% (depending on the Franklin Templeton Series T fund selected)
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Modify the income level as your client’s needs change The income rate can be modified at any time, without charge, to meet your client’s changing financial circumstances or lifestyle needs.
Series T in action
Client
Name: Patrick
Age: 57 years old
Target retirement year: 2030
Franklin Templeton Solution: Franklin ClearBridge Dividend Income Fund (Series T)
Initial investment: $100,000
Current income needs: A consistent income stream to pay for an annuity that will help fund his retirement
Solution
Patrick would normally receive income of $667, based on the fund’s investment target annual distribution rate of 8% and NAV (Net Asset Value Per Unit) of $6. But he only needs $450 per month. Working with his advisor, Patrick decides to customize the distribution rate to 5.4%, just enough to generate his required income. By reinvesting the difference – $2,600 over the course of the year – Patrick increases the growth potential of his portfolio.
The flexibility to meet Patrick’s future needs In 2027, Patrick will enter semi-retirement and his income requirements increase to $700 per month. With Series T, he can change the distribution rate to 7.58%, which will provide him with the higher income he needs.
The illustration assumes that the $100,000 investment and the Series T distribution rate of 8% are for Franklin ClearBridge Dividend Income Fund. It also assumes an 8% rate of return for the fund.