Definition, Meaning & Synonyms

tontine

noun

/tɒnˈtiːn/

Definition

A tontine is a financial arrangement where a group of individuals contributes money to a common fund, and the payouts are distributed among the contributors in a way that is dependent on the survival of the participants.

Examples

The members of the tontine shared the investment for years, hoping to reap the benefits as they aged.
In the 18th century, tontines were a popular way to raise capital for projects while providing income to the investors.
As the last surviving member of the tontine, she received a substantial payout.

Meaning

The tontine concept allows for a pension-like benefit, where those who live longer continue to receive payments, and the amount increases as participants pass away.