What's a tontine?

What is Tontina?

Tontina is a collective financial scheme in which members contribute money to a common fund and payments are received by surviving members. After the death of one of them, his share is redistributed among the living.

Historically, the scheme is associated with the name:

• Lorenzo de Tonti was an Italian financier of the XVII century, who proposed this model in France.

How Tonttina Works (Simply and Without Myths)

• A group of people contribute money to the fund.
• The fund is invested.
• Income is distributed among the participants.
• When someone dies, their share passes to the rest.
• At the end, there is only one recipient or payments are divided among the survivors.

Tontina and trusts - what is the connection?

A trust is a legal construct where:

• There is a founder (settlor),
• The manager (trustee),
• Beneficiary (beneficiary).

Tontina itself is not a trust, but it can be issued through the trust structure:

• A trust is created;
• assets are transferred to management;
• beneficiaries - participants of the tontin scheme;
• Redistribution rules are prescribed in trust deed.

That is, a trust is a shell, a tontina is a distribution mechanism.

Where was it used?

• France XVII-XVIII centuries - government loans.
• England is an investment club.
• USA XIX centuries - insurance analogues.
• Today - sometimes in pension models and private investment clubs.

Important to understand

Tontina:

• Increases profitability for “survivors”
• reduces the risk to the system,
• but has a strong ethical burden (benefit from the death of another participant).

That is why in many countries classical tontine schemes are limited or prohibited.

The classic tontina is a primitive version of the idea:

collective capital + long-term + redistribution of the risk of survival. But in its pure form, it is toxic.

The model of “who lived — he won” creates a hidden conflict of interest. This is not good for a meaningful economy. Now constructive.

How to take the principle of tontina and remove the ethical bias

1. Removing dependence on death

Death should not be a source of income. Instead, you can use:

• The age phases,
• Stages of the life cycle,
• achievement of social metrics,
• contribution to the common good.

Redistribution is for contribution, not elimination.

2. Translate the model into the "Life Cycle Foundation"

Structure:

• A collective pool of capital.
• Long-term investments.
• Automatic recalculation of shares.

Income increases for those who:

• remains an active participant,
• meet the system criteria,
• It supports the overall ecosystem.

It's not a tontina. It is a cooperative evolutionary model of capital.

3. Redistribution without immoral incentive

You can use three levels:

Level 1 — Base share

Each participant has a share protected from zeroing.

Level 2 — Activity share

Depends on:

• contributions,
• The Confidence Index,
• social rating,
• Participation in projects.

Level 3 — Standby circuit

If the participant leaves the system:

• His share is partially returned to the heirs,
• partly in reserve,
• It partially strengthens the fund.

No benefit from someone's death. Only structural sustainability.

What it gives

• Solving the problem of longevity (actually in the 21 century).
• A collective pension model of a new type.
• Sustainability of the fund without external subsidies.
• Ethical conformity.

If you want to build a meaningful economy, then the models should be:

• anti-conflict,
• long term,
• mathematically transparent,
• psychologically stable.

Tontina is the beginning of an idea. We can make it version 2.0.

The basis of a new system of long-term social capital.

This should work at the level of the state or civilization bloc, the model should be:

• Legally clean,
• demographically sustainable,
• transparent,
• Lack of moral bias.

Evolutionary model of the public fund (tontina 2.0)

1 - Basic idea

Citizens form the National (or Union) Long-Term Capital Fund. This is not a pension fund in the classical sense.

It is the infrastructure capital of generations. Principle:

Capital does not belong to the individual, but to the generation.

Income is distributed among the living participants, not through death, but through the phase of life.

2 - Structure

A. The Generations Fund

• Formed through contributions, rents, natural resources, digital assets.
• It is invested in long-term industries (energy, infrastructure, technology).

B. Accumulation phase (0–40 years)

• Individual share is formed.
• Income is reinvested.

B. Participation phase (40–65 years)

• The participant receives a portion of the income.
• Contribution to the economy and social stability is stimulated.

Mr. Guaranteed income phase (65+)

• Stable payment.
• Fate does not disappear after death - it returns to the generational pool.

This is where the “tontine” effect occurs — but without the personal benefit of someone else’s death.

3 - What is different from the pension system

Classical pension	Evolutionary model
Pyramid "working → pensioners"	Capitalized fund
Deficit in ageing	Growth with long-term investments
State burden	Self-replicating system
Political risks	Mathematical transparency

4 - Why it's a politically strong idea

• It solves the demographic crisis.
• It alleviates the fear of old age.
• It creates collective responsibility.
• It turns citizens into co-owners of the economy.

It is no longer a financial instrument. This is a new type of social contract.

5 - Where there are close analogues

The Government Pension Fund Global

It is formed from oil rents. Invest globally. Provides generational sustainability.

Future Generations Fund Temasek Holdings GIC

The Strategic National Capital Model. But they do not have a mechanism for redistribution of life phases. This is the space for our concept.

DOCTrin of the Generations Fund

(a new type of political and economic document)

1. The problem of XXI century faces three crises:

• demographic imbalance,
• pension instability,
• Lack of a share in the national capital.

The existing model of "working contain pensioners" is mathematically unstable with an aging population. We need a system where:

Capital works for a generation, not a generation.

2. The principle of the Generation Fund is:

• national (or union) sovereign capital,
• belonging to all citizens,
• long-term investment,
• Distribution of income through life phases.

It's not a benefit. This is co-ownership of the economy.

3. Architecture

A. Sources of capital

• resource rent,
• strategic industries,
• dividends of state corporations,
• digital assets,
• infrastructure projects.

B. Share structure

Every citizen receives:

• Basic share (inalienable),
• Share of participation (depending on contribution),
• Generational share (returned to the pool after death).

Here is the built-in redistribution mechanism - but without the "benefit from death."

4. Phases of life

It relieves pension fear and strengthens long-term thinking.

5. International prototypes

The Norwegian Government Pension Fund Global

A sovereign fund that invests oil rents.

Singapore Temasek Holdings GIC

Public investment capital. Difference: They manage capital. We are creating a model of generational participation.

PLATFORM FOR PARTY "FENIX"

If this goes into the political program, the wording should be rigid and understandable.

1. Central thesis

Every citizen is a co-owner of national capital.

2. Political effects

• Elimination of the pension pyramid,
• reduction of social tension,
• Incentives for birth,
• Building a long-term elite.

3. Key promises

• Creation of the Sovereign Generations Fund.
• Establishing the basic share of the citizen in the Constitution.
• Transition from the tax model of "exemption" to the model of "coherence".
• Transparent digital reporting of the fund.

If you go with this in politics, you need to understand:

• The elite will resist.
• financial groups are opposed,
• A transition period of 10–15 years will be required.

This is a strong strategic agenda.

It brings together economics, demography and justice.

If the model does not pass mathematics, it can not be taken into politics. We will make a basic framework of the economic and demographic model of the Generations Fund.

Basic model parameters

Let's say:

• N - Population
• W - number of employees
• R is the number of dividends received 65+
• C - average annual contribution per person
• R > Average Return of the Fund
• F(t) - the capital of the fund in time
• D — annual dividend 65+

Fund accumulation formula

Fund capital: 

F(t+1) = F(t) \cdot (1+r) + W \cdot C - D \cdot R

The system is stable if: 

rF + WC > DR. That is: 

investment return + tributaries > Payouts.

Example of calculation (conditional country)

Suppose:

• N = 50 million
• W = 30 million
• R = 10 million
• C = 2 000 $ per year
• r = 5%
• Start-up fund F₀ = 500 billion $

Inflow: 30 million × 2 000 $ = 60 billion $ per year

Yield: 5% from 500 billion = 25 billion $

Total resources = 85 billion $ If we allocate 10 million pensioners:

85 billion / 10 million = 8 500 $ per year per person. The fund is not decreasing. This is fundamentally important:

The system works not as a pyramid, but as a capitalized model.

Demographic Sensitivity

The main risks:

• Ageing (R)
• Decreased yield (r ↓)
• Decrease in the number of employees (W ↓)

To prevent the system from collapsing, the following are needed:

• automatic dividend adjustment,
• minimum rate of return,
• backup buffer 3–5 years of payments.

Model of "life cycle"

Now add a generational mechanism.

Every citizen has: S_i(t) = B + A_i(t)U where:

• B - base share (equal)
• A_i — share of activity

After death:

A_i \to 50\% to heirs + 50\% to the generational pool

This creates a natural growth of the fund without a conflict of interest.

Strategic sustainability condition

For the model to be stable 50+ years:

• Average Fund Return ≥ Rate of inflation + 2%
• Demographics not lower than birth rate 1.6–1.8
• Fund share ≥ 150–200% GDP

Here is the key moment. Norway has more than 2 times the GDP. The Government Pension Fund Global is a benchmark of scale.

Advantage over classical pension

In the classical system: Pension = Tax. In the new system: Pension = Income from capital. This is a fundamental difference.

If we want to do this seriously for "FENIX", we need:

• Determine the target size of the fund (in % of GDP).
• Identify sources of content.
• Calculate 30-year-old scenario.
• Simulate crisis 2008-type.

Without a stress test, this cannot be done in politics.

STRESS TEST (crisis 2008-type + Aging)

Basic parameters (conditional model)

• Fund: 30 trillion $
• Normal yield: 5%
• Working: 60%
• 65+: 20%
• Payments: 4% from capital

Scenario 1 — Financial crisis

• Markets are falling −25%
• Yield 0% two years
• Increase in unemployment −10%

What's Happening: Capital: 30 trillion → 22.5 trillion

If the payments are not adjusted, the fund begins to “eat”.

Solution: Automatic rule:

Payouts = min (4% capital, average return for 5 years)

It alleviates the crisis.

Scenario 2 - Demographic Impact

• 65+ grow from 20% to 30%
• Working becomes 50%

Stability condition: rF + WC > DR. If R grows faster than profitability, the system cracks.

Decision:

• Increase the age of the dividend phase.
• Linkage of payments to the demographic load factor.
• Mandatory reserve = 5 years of payments.

MODELS FOR RUSSIA

We take real orders of magnitude.

• Population ≈ 146 million
• Workers ≈ 75 million
• 65+ ≈ 22 million
• GDP ≈ 2 trillion $

If the trust fund = 150% GDP: → Needed ~3 trillion $

This is the strategic goal of 20–25 years.

Sources of filling

• Rental income (oil, gas, metals)
• 20–30% State Company Dividends
• Part of export duty
• Sovereign digital assets
• Infrastructure projects

Russia already has: National Welfare Fund

But its volume is not the strategic scale of generational capital.

Basic calculation

If you send annually 5% GDP: 2 trillion × 5% = 100 billion $ per year

At an average yield of 4–5%:

Via 20 years capital ≈ 3–3.5 trillion $. This is the level of sustainability.

Possible dividend 65+

The Foundation 3 trillion and payment 3%: 90 billion $ / 22 million ≈ 4 000 $ per year

This is not a “pension” but a generational dividend. The fund remains.

The main risks of Russia

• Restrictions on investment.
• commodity volatility.
• Demographics (decrease in birth rate).
• Political opacity of fund management.

If the fund is opaque, there will be no trust.

If the yield is lower than inflation, the model is dead.

What you need for a real launch

• Constitutional consolidation of the fund.
• Inviolability of capital.
• Public digital reporting.
• Tough investment mandate.
• Automatic adjustments of payments.

It all depends on the depth of calculations and institutional discipline.

30-YEAR SCENARIUM FOR RUSSIA

Assumptions

• GDP: $2 trillion (in constant prices)
• Annual deduction: 5% GDP = $100 billion
• Start-up fund: $150 billion (conditionally)
• Horizon: 30 years

1 - Conservative scenario

• Yield: 3%
• Economic growth: 1%
• Demographics are deteriorating

Via 30 Years: Foundation ≈ $2.4–2.7 trillion

Possible Dividend (3% payments): ≈ $70–80 billion per year

≈ $3 000 the Pensioner

The system is stable, but without a margin of strength.

2 - Basic scenario

• Yield: 4.5%
• Height: 1.5–2%
• Stabilization of demography

After 30 years:

Fund ≈ $3.5–4 trillion

Dividend:

≈ $100–120 billion

≈ $4 500–5 000 per year per person 65+

This is already a structural factor in the economy.

3 - Aggressive scenario

• Yield: 6%
• Height: 2–3%
• Active industrial policy

Via 30 Years: Foundation ≈ $5–6 trillion

Dividend: ≈ $150–180 billion ≈ $6 000–7 000 per person

This is already turning the country into a capitalized civilization.

SCENARIUM OF COMPLETE SANCTION INSOLTION

The main risk is limited access to global capital markets.

Possible actions:

• Domestic investment:
• infrastructure,
• energy,
• mechanical engineering,
• AI and robotization.
• Investment in friendly jurisdictions.
• Creating an internal stock market.

Yields are falling to 2.5–3%, but strategic autonomy is growing.

The main thing is not to chase speculative returns.

INFLUENCE ON CHRISTMAS

That's the key. If the child automatically receives a share of the fund at birth:

• the family perceives the child as the capital of the future,
• There is generational security.
• The fear of poverty decreases in old age.

Even +0.2 Birth rate on the horizon 20 It has radically changed demographics. But:

Money alone does not increase fertility.

Needed:

• housing,
• stability,
• culture,
• confidence in the future.

The fund is the anchor of confidence.

NUCLEAR OF THE PARTY PROGRAM "FENIX"

If you do it politically, the formula should be simple:

"Every citizen is a co-owner of national capital."

Three pillars:

1 - Sovereign Generations Fund.

2 - Constitutional protection of the citizen's share.

3 - Transition from tax model to dividend model.

Political effect

• Elimination of pension instability.
• Reduced social anxiety.
• Increased long-term planning.
• Formation of the elite of capital, not raw materials.

CRITICAL CONDITIONS OF SUCCESS

• Full transparency.
• Inviolability of capital.
• Automatic payment formulas.
• Professional management.
• Ban on the use of the fund for budget patching.

Without this, it will become another reserve fund for the political cycle.

PUBLIC ECONOMIC MODEL

1. Model parameters of Russia

2. Fund Formula

F(t+1) = F(t) \cdot (1 + r) + W \cdot C - D \cdot R

where D is the annual dividend for the retiree.

Condition of sustainability:

r F + W \cdot C \ge D \cdot R

3. Scripts

4. Demographic effect

• The introduction of automatic share participation of newborns increases safety and stimulates long-term planning.
• Stress tests show that when the yield falls or the share of pensioners increases, the fund is stable when adjusting payments according to the formula:

D_Corra = \min(D, r \cdot F / R)

II. CONSTITUTIONAL SUPPLY

1. Basic principle

"Every citizen of Russia is a co-owner of the Sovereign Generations Fund."

2. Fixing structure

• Article about the fund
• The fund is formed by the rent of natural resources, dividends of state-owned companies, part of export revenues.
• The capital of the fund is inviolable for budget financing of current expenses of the state.
• Article on the rights of citizens
• Every citizen has a basic share of participation, fixed from the moment of birth.
• The share is redistributed over the life cycle: active phase → pension phase → return to the fund.
• Article on management
• Independent Board of Fund Managers.
• Automatic rules of income distribution.
• Mandatory public reporting.
• Article on protection and audits
• Public digital reports.
• Regular audits at the international level.
• Prohibition on the use of the fund to finance the budget deficit.

3. Key benefits

• economic transparency.
• Long-term sustainability of pensions.
• Demographic stability.
• Political and financial predictability.