The mutualized life annuity: how does it work and what are the advantages?
With an ever-increasing life expectancy, the life annuity has met with certain success in traditional real estate. Recently, some players have adopted this principle to apply it to luxury real estate. We then speak of mutualised life annuity. Discover a new wealth optimization solution with the mutualized life annuity in Monaco!
What is the mutualized life annuity?
The principle of the life annuity is relatively simple. The owner decides to sell his property during his lifetime while retaining his enjoyment, he receives for this an initial capital when signing the sale, plus an annuity throughout his existence. The mutualized life annuity takes up this principle and adapts it to prestigious real estate. Some players offer an investment product, which adapts very well to asset investment in Monaco. How does the mutualized life annuity work in Monaco?
Concretely, when signing the deed of sale, the owner receives a very large capital, up to 80% of the value of the property, and retains the Right of Use and Occupation of his property for life. The calculation of the initial capital takes into account the owner’s age and the estimated life expectancy, based on life tables.
The mutualized life annuity therefore has two fundamental differences from the traditional life annuity. First, the beneficiaries receive substantial and immediate capital upon signing the deed of sale. In addition, buyers only have to pay an initial capital and no monthly annuities. This mechanism makes it possible to have a typology of institutional purchasers, groups of investors or investment funds, who will be attracted by investments without the risk of the monthly rent.
This type of buyer is all the more reassuring for sellers, since they are institutional buyers and not individuals.
What are the advantages of the mutualized life annuity?
The mutualized life annuity solution is therefore interesting in several ways for the owner. By receiving significant capital during his lifetime, he is thus able to better organize his succession and to optimize tax.
In addition, the beneficiary remains in control of his choices at all times. As mentioned above, he is free to stay in his property or to leave prematurely. In all cases, he benefits from significant capital which gives him a free hand in matters of inheritance, investment or tax optimization.
The shared life annuity is also a solution that allows you to manage your assets discreetly. Most senior owners in Monaco want the process of selling their property to remain confidential. The mutualized life annuity only connects institutional players who are used to operating confidentially. The mutualized life annuity process in Monaco therefore does not involve any advertising.
Finally, the shared life annuity is a guaranteed and completely secure transfer solution. As mentioned above, this type of life annuity only implements recognized actors. Thus, institutional acquiring funds are all regulated by the French Financial Markets Association (AMAFI). These players are subject to strict standards and are regularly audited.
