Retirement Plan Information Session Todays meeting Why plan for - - PowerPoint PPT Presentation

Retirement Plan Information Session

Today’s meeting

• Why plan for retirement?
• Your Plan
• Your investment options
• GWL Services and support

Why plan?

“Someone is sitting in the shade today because someone planted a tree” – Warren Buffet

Why plan?

• Your hopes and dreams?

Sample lifestyles - Conservative

Item Single Couple

Food $3,321 $5,084 Housing $5,744 $6,291 Household operation $2,790 $3,349 Clothing $ 832 $1,252 Recreation / leisure $ 633 $1,489 Travel $ 650 $1,000 Transportation $3,157 $4,982 Health & personal care $1,650 $2,400 Gifts and donation $1,255 $2,418 Tobacco and alcohol $ 514 $ 685 Savings $ 199 $ 851 Interest paid and miscellaneous $ 335 $ 277 Estimated personal income taxes $3,720 $5,729

Total Annual Ret. Income $24,800 $35,807

Sample lifestyles – Above Average

Item Single Couple

Food $ 4,982 $ 7,893 Housing $ 9,334 $10,616 Household operation $ 4,534 $ 5,861 Clothing $ 1,631 $ 2,848 Recreation / leisure $ 1,662 $ 4,579 Travel $ 2,730 $ 5,440 Transportation $ 6,630 $11,770 Health & personal care $ 3,094 $ 3,750 Gifts and donation $ 2,610 $ 4,570 Tobacco and alcohol $ 907 $ 1,541 Savings $ 1,679 $ 4,361 Interest paid and miscellaneous $ 804 $ 738 Estimated personal income taxes $18,239 $31,506

Total Annual Ret. Income $58,836 $95,473

Why plan?

Government Benefits

Canada Pension * = $10,905/yr** MAX

– Available as early as age 60 if you are retired – Reduced if you start to collect before 65 – Taxable

Old Age Security * = $6,204/yr MAX

– Available at age 65 – Must meet residency requirements – Taxable

*2009 benefits **Payout varies depending on years of service, salary, amount of contributions, etc.

Government Benefits Government benefits - Average

• Old Age Security

= $ 5,874/yr AVG*

• CPP/QPP**

= $ 6,018/yr AVG at age 65* = $ 4,212/yr AVG at age 60* For more information visit the Service Canada web site at www.servicecanada.gc.ca

*March 2009 stats from www.servicecanada.gc.ca

Your Plan

Your Plan Defined Contribution Pension Plan

• The contributions made to the plan by you and your

employer are defined

• Your benefit in retirement will depend on the

contributions made to the plan and the investment returns earned by those contributions

Your Plan

ELIGIBILITY Full-time employees

• after 1 year of continuous employment

Part-time employees

• after 2 years of continuous employment with

earnings at least 35% of YMPE and 700 hours worked in each of the 2 years prior to joining

Your Plan

CONTRIBUTIONS Employee required

(i) 7.5% of gross monthly earnings, or (ii) 5% of gross monthly earnings Employee voluntary contributions are allowed but not matched by the employer

Employer

• 100% match of employee required contributions

Your Plan

IN-SERVICE WITHDRAWALS

• not allowed

VESTING

• 2 years of continuous plan membership
• Locked-in after one year of continuous plan membership

INVESTMENT OPTIONS

• You decide for your contributions
• Employer contributions are invested in a five-year GIC
• default investment option is the Continuum Balanced

Fund

CRA Limits and Pension Adjustments

• RRSP contribution limit is 18% of

earned income to a maximum of $21,000 (2009) and $22,000 (2010)

• Notice of Assessment includes your

RRSP limit and any carry forward room

• Pension contributions affect your

limit

• T4 discloses the total as a Pension

Adjustment

Your Plan

Benefits of your group plan

• Employer contribution
• Preferred investment fees
• Easy payroll deductions
• No front end or back end

loads

Your investment options

Risk vs. return

What kind of investor are you?

Investment personality questionnaire

• How do you make choices within your plan?
• Sixteen questions can help you
• Determine your own risk profile

You’ve determined your investment personality….. now what “approach” will you take?

Hands On? Hands Off? What kind of investor are you?

Continuum – the hands-off approach

Asset Allocation Funds

Conservative Moderate Balanced * Advanced Aggressive Equity: 25% Fixed income: 75% Equity: 40% Fixed income: 60% Equity: 60% Fixed Income: 40% Equity: 80% Fixed income: 20% Equity: 100%

*Default fund

The hands-on approach

Investment personality questionnaire

Note: If your plan sponsor has not selected any funds in the Special equity class, it’s suggested that you fulfill the recommended percentage with funds from another asset class. Special equity Fixed income Foreign equity Canadian equity Balanced

Advanced investor Aggressive investor Conservative investor Moderate investor Balanced investor

The hands - on approach 10 Professional Investment Managers 20 Market Based Funds to pick from plus 1 and 5 year GIAs

The hands-on approach

• Fund Details
• Portfolio by Sector
• Major Holdings
• Fund Composition
• Fund Performance

GWL Services and support

Services and support

• Check out your

enrolment kit

Services and support Smart tools CD

• Library of articles
• Flexible retirement calculators
• Glossary of terms

• Account balances
• Provide or change investment instructions
• Process inter-fund transfers
• Retirement planning tool
• On-demand statements

www.grsaccess.com GRS Access

1-800-724-3402

• Provide or change investment instructions
• Process inter-fund transfers
• Get assistance with your application
• Update information
• 8:00 am to 8:00 pm (ET)

Client Service Centre

Statements

• Mailed quarterly
• Personalized net rates of return
• Custom messages
• Also available on GRS Access

Questions