Maturity of the Sun Life Granite 2025 Segregated Funds
Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the funds listed below, which are established as segregated funds in accordance with the Insurance Companies Act (Canada).
Sun Life Global Investments (SLGI) has announced that the Sun Life Granite® 2025 Target Date and Multi-Risk Target Date Segregated Funds (“Granite 2025 Funds”) will mature in July 2025. Here is a list of the impacted funds:
- Granite 2025
- Granite 2025 Conservative
- Granite 2025 Moderate
- Granite 2025 Aggressive
What happens when a Granite 2025 Fund reaches its year of maturity?
In general, when a Granite fund reaches the year identified in its name, it will have reached its most conservative investment mix. This investment mix seeks to provide income and moderate long-term growth of capital for investors beginning to withdraw their money. In four years, SLGI will merge the maturing Granite 2025 fund into the Sun Life Granite Moderate Retirement Fund. For the Granite Multi-Risk Target Date Funds, they will merge into the corresponding Granite Multi-Risk Retirement fund (“Granite Retirement Funds”):
Maturing Fund |
Merging into |
|---|---|
Granite 2025 |
Granite Retirement |
Granite 2025 Conservative |
Granite Conservative Retirement |
Granite 2025 Moderate |
Granite Moderate Retirement |
Granite 2025 Aggressive |
Granite Aggressive Retirement |
The Granite 2025 Funds’ asset mix will stop evolving and will become identical to the corresponding Granite Retirement Funds in July 2025.
After October 15, 2025, member contributions will no longer go into the Granite 2025 Funds. Sun Life will redirect all future member contributions in the Granite 2025 Funds to the corresponding Granite Retirement Fund(s). At that time, plan sponsors will no longer be able to add the Granite 2025 Funds to their line-ups.
The Granite 2025 Funds will close and merge into the Granite Retirement Funds in approximately July 2029 (4 years after maturity).
Why will SLGI wait 4 years between the maturity of the Granite 2025 Funds and their merger into the Granite Retirement Fund?
SLGI opted to give plan members with money in the Granite 2025 Funds more flexibility/time for tax planning purposes. For investors who hold the fund in a non-registered plan, the merger of a maturing target date fund into the Retirement Fund currently is considered a taxable event in Canada.
Summary of timeline of Granite 2025 Funds maturity
We’ll be closing the Granite 2025 Funds to new members on October 15, 2025. At that time:
- The Granite 2025 Funds will no longer be available for addition to plan sponsor line-ups.
- The Granite 2025 Funds will no longer be available as the default option.
- The Granite 2025 Funds will no longer receive new money (i.e. contributions or transfers in).
- We’ll redirect members’ contribution instructions for the Granite 2025 Fund(s) to the corresponding Granite Retirement Fund(s).
Plan members can keep their money in the Granite 2025 Funds until July 2029. Sun Life will then move plan member money into the Granite Retirement Fund(s). Alternatively, plan members can move their money in the Granite 2025 Fund(s) to the Granite Retirement Fund(s) (or any other fund that meets their needs) any time before July 2029.
Tax impact
Plan members with money in a Non-Registered plan may experience a capital gain or loss when money is transferred to the Granite Retirement Fund. Members must report capital gains and losses in the year the transfer occurs. Sun Life will provide the applicable tax slip(s) that reflect all income from members’ Non-Registered investments.
We’ve provided more information about how capital gains/losses are generated and their impact here. We recommend that members talk with a tax professional for advice specific to their situation and taxable investments.
There are no tax implications for money held in Registered (non taxable) plans.
About the Granite Target Date fund series
The Granite and Granite Multi-Risk Target Date funds series use a multi-manager structure to create a balanced asset mix. SLGI invests assets in both active and passive funds across various asset classes, investment styles and geographic regions. SLGI manages the asset mix tactically to take advantage of changing market conditions. The Granite Funds provide exposure to the following asset classes:
- Canadian equities
- U.S. equities
- International equities (developed and emerging markets)
- Fixed income (domestic and foreign including emerging markets debt)
- Real Estate Investment Trusts (REITs)
- Specialty equity and fixed income (private fixed income, high yield bonds, global natural resources)
- Other specialty asset classes (direct infrastructure, direct real estate, and liquid alternatives)
- Cash and equivalents
The series is available with target maturity dates in 5-year intervals (Retirement, 2030, 2035, 2040, 2045, 2050, 2055, 2060 and 2065). Members select the target date fund that most closely aligns with the year when they plan to retire. Each fund becomes more conservative as it moves closer to its maturity. At maturity, each fund moves into its corresponding Retirement fund.
The current glidepaths are below. (Note that the Granite glidepath is identical to the Granite Moderate glidepath for the purposes of the chart below.)
Granite MRTD Glidepath
| Years remaining to maturity | 40 | 35 | 30 | 25 | 20 | 15 | 10 | 5 | 0 |
|---|---|---|---|---|---|---|---|---|---|
| SLF Granite Moderate | 93.0% | 93.0% | 92.0% | 91.0% | 86.0% | 78.0% | 67.0% | 54.0% | 41.5% |
| SLF Granite Aggressive | 96.0% | 96.0% | 96.0% | 95.7% | 91.8% | 86.0% | 78.0% | 67.0% | 48.0% |
| SLF Granite Conservative | 91.5% | 91.5% | 91.0% | 86.0% | 78.0% | 67.0% | 54.0% | 41.5% | 35.0% |
About the Granite Retirement Funds
The Granite Retirement Funds are targeted towards people currently near or in retirement. As such, they seek income and moderate long-term growth of capital. They hold a blend of investments that investors may find appropriate for their retirement years. They invest as follows (approximate allocations):
- Granite Retirement - 41.5% in stocks and 58.5% in bonds
- Granite Conservative Retirement – 35% in stocks and 65% in bonds
- Granite Moderate Retirement – 41.5% in stocks and 58.5% in bonds
- Granite Aggressive Retirement – 48% in stocks and 52% in bonds
The Granite Retirement Funds are the most conservative funds in their respective series of target date funds. They are also the only Granite Funds that maintain a near-consistent investment mix over time.
How will this impact you and your plan members?
You or your plan members do not need to take any action at this time. We’ll send email communication to impacted members on or around June 30, 2025. Here is a copy for your reference.
Plan members with money invested in the Granite 2025 Funds as part of a non-registered plan should consider the tax impact the merger may have on their particular situation.
Closer to the merger date in July 2029, we’ll provide you and plan members with confirmation of exact timing and reminder of the merger.
Questions?
Please contact your Sun Life Group Retirement Services representative*.
*In Quebec, registered as a Group annuity plans advisor.