01 / Allocate
Build the payment ladder
Divide the starting contribution across dated portfolios. Each rung is aligned with a future payment year.
Target-date tontine · interactive research model
One contribution. A portfolio for every future payment.
A target-date ladder manages investment risk across time. The Fair Tontine Engine allocates mortality credits among the remaining members. Explore how the two mechanisms interact over a 30-year retirement horizon.
01 / Interactive model
Explore the 30-year simulation
Choose a pool, move through time and switch between income, the target-date ladder, surviving membership and cumulative payout to age 95. “Without FTP” is the same survival-weighted ladder with member transfers switched off, not ordinary drawdown.
Pool size
View
Simulation year10 / 30
500-member poolAnnual income
Income distribution among members alive in each year.
Median income£23,664
5th–95th range£21,828–£25,485
Without FTP£19,953
Representative survivors391
02 / Pool comparison
Pool size changes the late-life outcome
Large pools keep the longevity-sharing mechanism viable deeper into retirement. “Without FTP” uses the same survival-weighted ladder and mortality assumptions with mortality-credit transfers switched off; it is not ordinary drawdown.
Year-by-year survivor-conditioned median
500 members
<0.1%
200 members
3.7%
100 members
99.3%
50 members
>99.9%
Wind-down threshold: fewer than 20 members. Roughly 13–14% survive to year 30, leaving a 200-person pool at about 27 members—above the threshold—while a 100-person pool lands in the mid-teens, below it.
| Pool | Wind-down probability | Year-30 median | 5th–95th range | Without FTP | Representative survivors | Cumulative-payout median to age 95 |
|---|---|---|---|---|---|---|
| 500 | <0.1% | £24,579 | £15,460–£38,523 | £2,295 | 68 | £475,006 |
| 200 | 3.7% | £24,511 | £12,770–£42,307 | £2,573 | 27 | £473,356 |
| 100 | 99.3% | £17,782 | £10,949–£29,288 | £2,381 | 15 | £463,071 |
| 50 | >99.9% | £6,061 | £3,786–£9,473 | £2,329 | 6 | £479,347 |
03 / Inside the model
Two mechanisms, two jobs
The target-date ladder manages the investment path. The Fair Tontine Engine, which implements the Fair Transfer Plan (FTP), manages transfers between members.
02 / De-risk
Run each glide path
Long-dated rungs begin with more growth exposure. Risk falls as the payment date approaches.
03 / Transfer
Allocate mortality credits
When a member dies, FTP allocates the released estate across the remaining pool under the fair-transfer rule.
04 / Adaptive ladder
A funding-responsive target-date ladder
Each payment rung is measured against a survival-weighted target. Well-funded rungs de-risk; shortfalls retain permitted growth exposure within a hard risk cap.
Set the target
Allocate capital using discount factors, survival probabilities and the intended income shape.
Measure funding
Compare settled assets with the current survival-weighted value of each target payment.
Adjust risk
De-risk when ahead; retain permitted growth exposure when behind; respect the risk cap.
01Death event
02Exact FTP entitlement
03Source-unit shadow credit
04Proof-of-life settlement
05Recipient’s target-date ladder
Research architecture
05 / Method
Simulation assumptions
The model holds the member, market and glide-path assumptions fixed so that the pool-size effect can be seen directly.
View the complete assumption set
Focal memberMale · age 65
Starting contribution£300,000
Horizon30 years · age 65 to 95
Monte Carlo paths1,000
Pool choices50 · 100 · 200 · 500
Wind-down thresholdFewer than 20 members
Equity GBM drift (μ)6.5% p.a.
Equity volatility (σ)16.0% p.a.
Median log growth (μ − ½σ²)5.22% p.a.
Bond return3.5% p.a.
Glide path80% equity at 30+ years to 0% at 5 years
Transfer methodSabin separable FTP
Bond return: a conservative long-run total-return assumption, not the current gilt curve used in the liability-hedge example. Horizon: cumulative-payout results stop at age 95 and exclude later payments.