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Advantages of Investing in Green Bonds for Retirement Planning

In times of market volatility, bonds or fixed income can offer a safe harbour for your money. For those approaching retirement, shifting your investment portfolio towards fixed income instead of equity can help you dampen any negative market movements preserving your wealth.


As with all risk-reward relationships, decreasing your risk will decrease your return. But as you get closer to retirement you should be continuing to grow your portfolio slowly while shifting your focus to preserving your money instead from growing it.


With interest rates across the developed world being at record lows, fixed income as an asset has experienced a sharp decline in the yield offered. However, there are still opportunities to earn a meaningful return. For example, with RE Royalties green bonds, investors have the opportunity to earn a 6% return on their investment that is backed by a portfolio of renewable energy investments.


This return means that a $5,000 investment will pay you $300 per year or $75 per quarter and you will receive the full $5,000 back after 5 years. This is reliable, quarterly income that reduces your risk and ensures consistent payments helping you fund your retirement.


Additionally, the RE Royalties Green Bonds are eligible for many Canadian registered savings accounts such as the Registered Retirement Savings Plan (RRSP), Tax-Free Savings Account (TFSA), Registered Retirement Income Fund (RRIF), and Registered Education Savings Plan (RESP).


Now that it is clear what the ‘Bond’ in Green Bond means, what does the ‘Green’ part mean? Simply put, Green Bonds are bonds whose proceeds go towards renewable energy generation, energy efficiency management and sustainable infrastructure.


When you invest in Green Bonds for retirement not only are you earning a fixed rate of return but you are also putting your money towards creating a cleaner and greener world, you are climate proofing your portfolio.

The RE Royalties Green Bond Framework ensures that proceeds from investment in our Green Bonds will go towards eligible investment of renewable energy, energy efficiency and management, and clean infrastructure and transportation. Not only will your money be invested in these types of investment but the team at RE Royalties will update the investors on how the bond proceeds are allocated in a report that will also include impact reporting that contains qualitative and quantitative metrics.


Climate change is one of the biggest problems that society faces and it is incredibly important to align your retirement investing with your values. Investing in Green Bonds for retirement is a safer and more impactful way to climate proof your portfolio and invest in the green future of the world.


Learn more about how to save for retirement while saving the planet here.

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