[PPT] - Will You Be Retirement Ready? Quarterly Webinar October 25, 2018 PowerPoint Presentation

SLIDE 1

WELCOME

Quarterly Webinar

Will You Be Retirement Ready?

October 25, 2018

SLIDE 2

David Baskin President and Founder, Baskin Wealth Management (BWM)

TODAY’S SPEAKERS

Michael Kimmel Executive Director, RPB Stephanie Berger Director of Marketing and Communications, RPB

G. Leonard Teitelbaum

Chair, RPB Board of Trustees

SLIDE 3

Opening Remarks Market and Plan Update Will You Be Retirement Ready? Q&A

AGENDA

SLIDE 4

OPENING REMARKS

SLIDE 5

MARKET & PLAN UPDATE

SLIDE 6

Varied market returns year-to-date as US equities have performed better than non-US equities and fixed income Growth continued to outperform globally Increasing inflation concerns have weighed on interest rates and have been a source for equity volatility Political focus increasing with upcoming US mid-term elections and ongoing trade discussions Return to volatility after two years of stable/rising markets

Key Themes: 2018 Year-To-Date

SLIDE 7

Continued return to normal volatility in 2018

Equity Market Volatility

Source: JPMorgan. As of 10/12/2018.

34% 20% 31% 27% 20%

10% -13%
23%

26% 9% 3% 14% 4%

38%

23% 13% 0% 13% 30% 11%

1%

10% 19% 5%

3%
8% -11%
19%
12%
17%
30%
34%
14%
8%
7%
8% -10%
49%
28%
16% -19%
10%
6%
7%
12% -11%
3%
10%
60%
50%
40%
30%
20%
10%

0% 10% 20% 30% 40% 1 9 9 5 1 9 9 6 1 9 9 7 1 9 9 8 1 9 9 9 2 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 2 9 2 1 2 1 1 2 1 2 2 1 3 2 1 4 2 1 5 2 1 6 2 1 7 2 1 8 S&P 500 Annual Return S&P 500 Largest Drawdown

SLIDE 8

2018 Asset Quilt – Diversification Matters

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 YTD 2018

Description

MLP 45.7% MLP 43.7% Core Bonds 10.3% EM 55.8% REITs 31.5% EM 34.0% REITs 35.9% EM 39.4% Core Bonds 5.2% EM 78.5% MLP 35.9% MLP 13.9% EM 18.2% US Equities 33.6% REITs 30.4% REITs 2.5% MLP 18.3% EM 37.3% US Equities 10.6% US Large and Small Stock Index REITs 26.8% REITs 12.8% REITs 3.7% MLP 44.5% EM 25.6% EAFE 13.5% EM 32.2% MLP 12.7% High Yield

26.2%

MLP 76.4% REITs 28.5% REITs 8.7% REITs 17.8% MLP 27.6% US Equities 12.6% Core Bonds 0.6% High Yield 17.1% EAFE 25.0% MLP 5.9% Master Limited Partnerships (Pipelines) Index Core Bonds 11.6% Core Bonds 8.4% High Yield

1.4%

EAFE 38.6% EAFE 20.3% REITs 12.1% EAFE 26.3% EAFE 11.2% MLP

36.9%

High Yield 58.2% EM 18.9% Core Bonds 7.8% EAFE 17.3% EAFE 22.8% Core Bonds 6.0% US Equities 0.5% US Equities 12.7% US Equities 21.1% High Yield 2.6% High Yield Bonds (Non-Investment Grade Bonds) Index High Yield

5.9%

High Yield 5.3% MLP

3.4%

REITs 36.8% MLP 16.7% MLP 6.3% MLP 26.1% Core Bonds 7.0% US Equities

37.3%

EAFE 31.8% US Equities 16.9% High Yield 5.0% US Equities 16.4% High Yield 7.4% MLP 4.8% EAFE

0.8%

EM 11.2% High Yield 7.5% REITs 2.3% Real Estate Investment Trust Index US Equities

7.5%

EM

2.6%

EM

6.2%

US Equities 31.1% US Equities 12.0% US Equities 6.1% US Equities 15.7% US Equities 5.1% REITs

38.0%

REITs 28.6% High Yield 15.1% US Equities 1.0% High Yield 15.8% REITs 2.5% High Yield 2.5% High Yield

4.5%

REITs 8.6% REITs 5.1% EAFE

1.4%

Developed Market International Stock Index EAFE

14.2%

US Equities

11.5%

EAFE

15.9%

High Yield 29.0% High Yield 11.1% High Yield 2.7% High Yield 11.9% High Yield 1.9% EAFE

43.4%

US Equities 28.3% EAFE 7.8% EAFE

12.1%

MLP 4.8% Core Bonds

2.0%

EM

2.2%

EM

14.9%

Core Bonds 2.7% Core Bonds 3.5% Core Bonds

1.6%

Diversified US Investment Grade Bond Index EM

30.8%

EAFE

21.4%

US Equities

21.5%

Core Bonds 4.1% Core Bonds 4.3% Core Bonds 2.4% Core Bonds 4.3% REITs

16.8%

EM

53.3%

Core Bonds 5.9% Core Bonds 6.5% EM

18.4%

Core Bonds 4.2% EM

2.6%

EAFE

4.9%

MLP

32.6%

EAFE 1.0% MLP

6.5%

EM

7.7%

Emerging Market Stock Index Best Performing Worst Performing

SLIDE 9

Over long periods Value has historically outperformed Growth Current 10-year period is unique; last experienced in the 1990s

Strong Growth Stock Performance

Source: Bloomberg

As of S eptember 30, 2018 1 Y ear 3 Y ear 5 Y ear 10 Y ear 20 Y ear R ussell 1000 Value 9.5% 13.6% 10.7% 9.8% 7.6% R ussell 1000 G rowth 26.3% 20.6% 16.6% 14.3% 7.2% MS C I E AFE Value

0.4%

8.1% 3.1% 4.5% 5.7% MS C I E AFE G rowth 5.8% 10.3% 5.6% 6.2% 4.6% MS C I E M Value 2.3% 11.6% 2.0% 4.5% 10.0% MS C I E M G rowth

3.9%

13.0% 5.1% 6.2% 9.5%

SLIDE 10

Inflation continues to drift higher Oil prices continue to recover Federal Reserve increasing interest rates in response

Increasing Inflation Concerns

Source: Bloomberg 73.3

20

20 40 60 80 100 120 140 160 S ep-98 S ep-00 S ep-02 S ep-04 S ep-06 S ep-08 S ep-10 S ep-12 S ep-14 S ep-16 S ep-18

Oil Price / Barrel ($)

2.3%

3%
2%
1%

0% 1% 2% 3% 4% 5% 6% S ep-98 S ep-00 S ep-02 S ep-04 S ep-06 S ep-08 S ep-10 S ep-12 S ep-14 S ep-16 S ep-18

Consumer Price Index (YoY, Headline)

SLIDE 11

Year-To-Date Tier 1 Investment Returns

January 1, 2018 through September 30, 2018

*Net of investment management fees. **50/50 MSCI ACWI (IMI)/Bloomberg Barclays Global Agg through March 31, 2015; 60/40 MSCI ACWI (IMI)/Bloomberg Barclays Global Agg through September 30, 2016;

60/40 MSCI ACWI (IMI)/Bloomberg Barclays U.S. Agg through September 30, 2017; 55/45 MSCI ACWI (IMI)/Bloomberg Barclays U.S. Agg thereafter.

***Barclays Global Aggregate January 1, 2013 through September 30, 2016, Barclays US Aggregate thereafter.

.

3.3% 3.7% 2.0% 1.4% 0.5%

1.6%

1.4% 1.3%

2.00%

0.00% 2.00% 4.00% 6.00% Capital Appreciation Fund MSCI ACWI IMI Index Appreciation and Income Fund 55% MSCI ACWI IMI/45% Fixed Income Composite** Income Focused Fund Fixed Income Composite*** Capital Preservation Fund FTSE 3 Month T-Bill

SLIDE 12

Since Inception Volatility – Lower is Less Risky

January 1, 2013 through September 30, 2018

*50/50 MSCI ACWI (IMI)/Bloomberg Barclays Global Agg through March 31, 2015; 60/40 MSCI ACWI (IMI)/Bloomberg Barclays Global Agg through September 30, 2016;

60/40 MSCI ACWI (IMI)/Bloomberg Barclays U.S. Agg through September 30, 2017; 55/45 MSCI ACWI (IMI)/Bloomberg Barclays U.S. Agg thereafter.

**Barclays Global Aggregate January 1, 2013 through September 30, 2016, Barclays US Aggregate thereafter.

.

9.0% 9.7% 6.0% 6.2% 2.9% 3.9% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0%

Capital Appreciation Fund MSCI ACWI IMI Appreciation & Income Fund 55% MSCI ACWI IMI/45% Fixed Income Composite* Income Focused Fund Fixed Income Composite**

Standard Deviation

SLIDE 13

Year-to-Date Tier 2 Investment Returns

January 1, 2018 through August 30, 2018

*Net of investment management fees.

10.5% 10.6% 11.0% 11.0%

1.6% -1.6%
8.8% -8.7%

0.6% 0.6%

1.6%
1.6%
2.1% -2.0%

0.8% 0.6%

0.1%
0.1%

3.8% 3.8%

10.00%
5.00%

0.00% 5.00% 10.00% 15.00% Vanguard S&P 500 Instl Index Fund (VIIIX) S&P 500 Vanguard Small Cap Index Fund (VSMAX) CRSP US Small Cap TR Index Vanguard Developed Mkts Idx Fund (VTMGX) FTSE Developed All Cap ex-U.S. Index Vanguard EM Markets Index Fund (VEAMX) FTSE EM Mkts All Cap China A Inclusion Index Vanguard REIT (VGSNX) Vanguard Spliced Real Estate Index Vanguard Total Bond Index Fund (VBTLX)

Blmbg. Barc. U.S. Aggregate

Vanguard Int-Term Corp Bond Index (VICSX)

Blmbg. Barc. U.S. Credit 5-10 Year Index

Vanguard ST Inflation-Protected Index (VTAPX)

Blmbg. Barc. U.S. TIPS 1-5 Year

Vanguard Short-Term Bond Index Fund (VBIRX)

Blmbg. Barc. U.S. Gov/Credit Float Adj: 1-5 Year

Reform JVI Fund MSCI AC World Index (Net)

SLIDE 14

WILL YOU BE RETIREMENT READY?

SLIDE 15

Retirement Planning is Changing: Key Trends

New vision: continuing to ‘work’ after retirement Longer lifespans Rising health care costs Focus on adequacy and income

SLIDE 16

Your Retirement Readiness

Multiple Sources Readiness Factors Income Replacement Ratio

Longevity

Retirement Income Retirement Standard of Living What You Control Taxable Tax-deferred Tax-advantaged Annuities Social Security Real Assets Salary How much of my income will I need in retirement? Contributions Retirement Age Social Security Age Retirement Budget Asset Allocation

SLIDE 17

The Income Replacement Ratio

Go-go, slow-go, and no-go years
Avoid overspending when first retired
Some spending categories slowly

decline (essentials/discretionary)

While other categories rise

(health care)

Expect some decrease in spending in

later years

RULE OF THUMB

80% of final pre-retirement gross salary

Consensus RPB Participant

Social Security 30% Retirement Savings 50% Social Security 20% Retirement Savings 60%

KEEP IN MIND: Spending in Retirement doesn’t remain stable

SLIDE 18

What Your Retirement Paycheck May Look Like*

Annual Pre-Retirement In Retirement Gross Income $129,000 $78,180 Social Security1 n/a $25,100 Total Gross Income $129,100 $103,280 Income Replacement Ratio Before Taxes 80%

* For illustrative purposes only and does not represent actual income earned or taxes paid. Consult with an accounting professional to help model your estimated pre- and post-retirement cash flow. Assumptions: 1. Retirement age is 67; Social Security income is 75% of maximum benefit 2. 3% elective deferral contribution 3. Up to 85% of Social Security income is taxed depending on other sources of income 4. Taxable income and taxes don’t include other deductions or exclusions; state tax rate at 6%, parsonage not excludable 5. Assumes rabbi pays social security tax at 12.4% of first $128,400 of gross income

SLIDE 19

What Your Retirement Paycheck May Look Like*

Annual Pre-Retirement In Retirement Gross Income $129,000 $78,180 Social Security1 n/a $25,100 Total Gross Income $129,100 $103,280 Income Replacement Ratio Before Taxes 80% Annual Personage ($50,000) ($50,000) Elective Deferral Retirement Contribution2 ($3,873) n/a Social Security Benefit Tax Adjustment3 n/a ($3,765) Annual Taxable Income4 $75,277 $49,515

Assumptions: 1. Retirement age is 67; Social Security income is 75% of maximum benefit 2. 3% elective deferral contribution 3. Up to 85% of Social Security income is taxed depending on other sources of income 4. Taxable income and taxes don’t include other deductions or exclusions; state tax rate at 6%, parsonage not excludable 5. Assumes rabbi pays social security tax at 12.4% of first $128,400 of gross income * For illustrative purposes only and does not represent actual income earned or taxes paid. Consult with an accounting professional to help model your estimated pre- and post-retirement cash flow.

SLIDE 20

What Your Retirement Paycheck May Look Like*

* For illustrative purposes only and does not represent actual income earned or taxes paid. Consult with an accounting professional to help model your estimated pre- and post-retirement cash flow.

Annual Pre-Retirement In Retirement Gross Income $129,000 $78,180 Social Security1 n/a $25,100 Total Gross Income $129,100 $103,280 Income Replacement Ratio Before Taxes 80% Annual Parsonage ($50,000) ($50,000) Elective Deferral Retirement Contribution2 ($3,873) n/a Social Security Benefit Tax Adjustment3 n/a ($3,765) Annual Taxable Income4 $75,277 $49,515 Monthly Gross Income $10,758 $6,515 Social Security Income1 n/a $2,091 Elective Deferral Retirement Contribution2 ($323) n/a Federal Taxes4 ($721) ($463) State Taxes4 ($626) ($498) Social Security & Medicare Tax5 ($1,483) n/a Medicare Part B Premium n/a ($134) Monthly Take Home Pay $7,606 $7,511 Income Replacement Ratio After Taxes 98.7%

Assumptions: 1. Retirement age is 67; Social Security income is 75% of maximum benefit 2. 3% elective deferral contribution 3. Up to 85% of Social Security income is taxed depending on other sources of income 4. Taxable income and taxes don’t include other deductions or exclusions; state tax rate is 6%, parsonage not excludable 5. Assumes rabbi pays social security tax at 12.4% of first $128,400 of gross income

SLIDE 21

Retirement Readiness Scenarios

How might increasing contributions and/or delaying retirement impact the retirement standard of living for these participants?

Participant 1 Participant 2 Participant 3 45 years old 58 years old 64 years old

SLIDE 22

Retirement Readiness Assumptions

DESCRIPTION ASSUMPTION Participant Profile Active Retirement Age 67 Life Expectancy 25 years in retirement Income Replacement Target 80% Social Security Benefit Age 67 Social Security Benefit 75% of maximum benefit at full retirement age Annual Inflation Rate (COLA) 2% Annual Salary Increase 3% Investment Return Returns based on allocation and time period*

* See appendix for hypothetical returns

SLIDE 23

Stay the Course Retirement Age 67 Employee Contribution % 0.0% Projected Account Balance $3,167,000 Change vs. Stay the Course

Projected

Income Replacement 63.7% Change vs. Stay the Course

Participant 1 Scenario:

45 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $330,000 RPB balance* Contributions: 15% employer / 0% employee

*as of 8/30/18

SLIDE 24

Stay the Course Increase Contribution 2% Retirement Age 67 67 Employee Contribution % 0.0% 2.0% Projected Account Balance $3,167,000 $3,419,000 Change vs. Stay the Course

$252,000

Projected Income Replacement 63.7% 67.9% Change vs. Stay the Course

4.2%

Participant 1 Scenario:

45 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $330,000 RPB balance* Contributions: 15% employer / 0% employee

*as of 8/30/18

SLIDE 25

Stay the Course Increase Contribution 2% Increase Contribution 4% Retirement Age 67 67 67 Employee Contribution % 0.0% 2.0% 4.0% Projected Account Balance $3,167,000 $3,418,000 $3,671,000 Change vs. Stay the Course

$252,000

$504,000 Projected Income Replacement 63.7% 67.9% 71.9% Change vs. Stay the Course

4.2%

8.2%

Participant 1 Scenario:

45 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $330,000 RPB balance* Contributions: 15% employer / 0% employee

*as of 8/30/18

SLIDE 26

Stay the Course Increase Contribution 2% Increase Contribution 4% Delay Retirement 1 Yr. Retirement Age 67 67 67 68 Employee Contribution % 0.0% 2.0% 4.0% 0.0% Projected Account Balance $3,167,000 $3,418,000 $3,671,000 $3,477,000 Change vs. Stay the Course

$252,000

$504,000 $310,000 Projected Income Replacement 63.7% 67.9% 71.9% 68.0% Change vs. Stay the Course

4.2%

8.2% 4.3%

Participant 1 Scenario:

45 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $330,000 RPB balance* Contributions: 15% employer / 0% employee

*as of 8/30/18

SLIDE 27

Stay the Course Increase Contribution 2% Increase Contribution 4% Delay Retirement 1 Yr. Delay Retirement 2 Yrs. Retirement Age 67 67 67 68 69 Employee Contribution % 0.0% 2.0% 4.0% 0.0% 0.0% Projected Account Balance $3,167,000 $3,418,000 $3,671,000 $3,477,000 $3,813,000 Change vs. Stay the Course

$252,000

$504,000 $310,000 $646,000 Projected Income Replacement 63.7% 67.9% 71.9% 68.0% 73.0% Change vs. Stay the Course

4.2%

8.2% 4.3% 9.3%

Participant 1 Scenario:

45 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $330,000 RPB balance* Contributions: 15% employer / 0% employee

*as of 8/30/18

SLIDE 28

Stay the Course Increase Contribution 2% Increase Contribution 4% Delay Retirement 1 Yr. Delay Retirement 2 Yrs.

Incr. Contrib.

4% & Delay

Retire. 1 yr.

Retirement Age 67 67 67 68 69 68 Employee Contribution % 0.0% 2.0% 4.0% 0.0% 0.0% 4.0% Projected Account Balance $3,167,000 $3,418,000 $3,671,000 $3,477,000 $3,813,000 $4,038,000 Change vs. Stay the Course

$252,000

$504,000 $310,000 $646,000 $871,000 Projected Income Replacement 63.7% 67.9% 71.9% 68.0% 73.0% 77.2% Change vs. Stay the Course

4.2%

8.2% 4.3% 9.3% 13.5%

Participant 1 Scenario:

45 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $330,000 RPB balance* Contributions: 15% employer / 0% employee

*as of 8/30/18

SLIDE 29

Stay the Course Retirement Age 67 Employee Contribution % 3.0% Projected Account Balance $2,268,000 Change vs. Stay the Course

Projected Income

Replacement Ratio 62.4% Change vs. Stay the Course

Participant 2 Scenario:

58 years old Saving horizon 33 years (joined RPB at 34; retires at 67) $1.2 million RPB balance* Contributions: 15% employer / 3% employee

*as of 8/30/18

SLIDE 30

Stay the Course Increase Contribution 2% Retirement Age 67 67 Employee Contribution % 3.0% 5.0% Projected Account Balance $2,268,000 $2,317,999 Change vs. Stay the Course

$49,000

Projected Income Replacement Ratio 62.4% 63.7% Change vs. Stay the Course

1.3%

Participant 2 Scenario:

58 years old Saving horizon 33 years (joined RPB at 34; retires at 67) $1.2 million RPB balance* Contributions: 15% employer / 3% employee

*as of 8/30/18

SLIDE 31

Stay the Course Increase Contribution 2% Increase Contribution 4% Retirement Age 67 67 67 Employee Contribution % 3.0% 5.0% 7.0% Projected Account Balance $2,268,000 $2,317,999 $2,366,000 Change vs. Stay the Course

$49,000

$98,000 Projected Income Replacement Ratio 62.4% 63.7% 64.8% Change vs. Stay the Course

1.3%

2.4%

Participant 2 Scenario:

58 years old Saving horizon 33 years (joined RPB at 34; retires at 67) $1.2 million RPB balance* Contributions: 15% employer / 3% employee

*as of 8/30/18

SLIDE 32

Stay the Course Increase Contribution 2% Increase Contribution 4% Delay Retirement 1 Yr. Retirement Age 67 67 67 68 Employee Contribution % 3.0% 5.0% 7.0% 3.0% Projected Account Balance $2,268,000 $2,317,999 $2,366,000 $2,447,000 Change vs. Stay the Course

$49,000

$98,000 $179,000 Projected Income Replacement Ratio 62.4% 63.7% 64.8% 67.0% Change vs. Stay the Course

1.3%

2.4% 4.6%

Participant 2 Scenario:

58 years old Saving horizon 33 years (joined RPB at 34; retires at 67) $1.2 million RPB balance* Contributions: 15% employer / 3% employee

*as of 8/30/18

SLIDE 33

Stay the Course Increase Contribution 2% Increase Contribution 4% Delay Retirement 1 Yr. Delay Retirement 3 Yrs. Retirement Age 67 67 67 68 70 Employee Contribution % 3.0% 5.0% 7.0% 3.0% 3.0% Projected Account Balance $2,268,000 $2,317,999 $2,366,000 $2,447,000 $2,854,000 Change vs. Stay the Course

$49,000

$98,000 $179,000 $586,000 Projected Income Replacement Ratio 62.4% 63.7% 64.8% 67.0% 77.2% Change vs. Stay the Course

1.3%

2.4% 4.6% 14.8%

Participant 2 Scenario:

58 years old Saving horizon 33 years (joined RPB at 34; retires at 67) $1.2 million RPB balance* Contributions: 15% employer / 3% employee

*as of 8/30/18

SLIDE 34

Stay the Course Increase Contribution 2% Increase Contribution 4% Delay Retirement 1 Yr. Delay Retirement 3 Yrs.

Incr. Contrib.

4% & Delay

Retire. 3 Yr.

Retirement Age 67 67 67 68 70 70 Employee Contribution % 3.0% 5.0% 7.0% 3.0% 3.0% 7.0% Projected Account Balance $2,268,000 $2,317,999 $2,366,000 $2,447,000 $2,854,000 $3,007,000 Change vs. Stay the Course

$49,000

$98,000 $179,000 $586,000 $739,000 Projected Income Replacement Ratio 62.4% 63.7% 64.8% 67.0% 77.2% 80.1% Change vs. Stay the Course

1.3%

2.4% 4.6% 14.8% 17.7%

Participant 2 Scenario:

58 years old Saving horizon 33 years (joined RPB at 34; retires at 67) $1.2 million RPB balance* Contributions: 15% employer / 3% employee

*as of 8/30/18

SLIDE 35

Stay the Course Retirement Age 67 Employee Contribution % 0.0% Projected Account Balance $1,792,000 Change vs. Stay the Course

Projected Income

Replacement Ratio 61.0% Change vs. Stay the Course

Participant 3 Scenario:

64 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $1.4 million RPB balance* Contributions: 13.4% employer / 0% employee

*as of 8/30/18

SLIDE 36

Stay the Course Increase Contribution 4% Retirement Age 67 67 Employee Contribution % 0.0% 4.0% Projected Account Balance $1,792,000 $1,820,000 Change vs. Stay the Course

$28,000

Projected Income Replacement Ratio 61.0% 61.8% Change vs. Stay the Course

0.8%

Participant 3 Scenario:

64 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $1.4 million RPB balance* Contributions: 13.4% employer / 0% employee

*as of 8/30/18

SLIDE 37

Stay the Course Increase Contribution 4% Delay Retirement 1 Yr. Retirement Age 67 67 68 Employee Contribution % 0.0% 4.0% 0.0% Projected Account Balance $1,792,000 $1,820,000 $1,925,000 Change vs. Stay the Course

$28,000

$133,000 Projected Income Replacement Ratio 61.0% 61.8% 64.6% Change vs. Stay the Course

0.8%

3.6%

Participant 3 Scenario:

64 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $1.4 million RPB balance* Contributions: 13.4% employer / 0% employee

*as of 8/30/18

SLIDE 38

Stay the Course Increase Contribution 4% Delay Retirement 1 Yr. Delay Retirement 3 Yrs. Retirement Age 67 67 68 69 Employee Contribution % 0.0% 4.0% 0.0% 0.0% Projected Account Balance $1,792,000 $1,820,000 $1,925,000 $2,216.000 Change vs. Stay the Course

$28,000

$133,000 $424,000 Projected Income Replacement Ratio 61.0% 61.8% 64.6% 73.4% Change vs. Stay the Course

0.8%

3.6% 12.4%

Participant 3 Scenario:

64 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $1.4 million RPB balance* Contributions: 13.4% employer / 0% employee

*as of 8/30/18

SLIDE 39

Stay the Course Increase Contribution 4% Delay Retirement 1 Yr. Delay Retirement 3 Yrs.

Incr. Contrib.

4% & Delay

Retire. 3 Yrs.

Retirement Age 67 67 68 69 70 Employee Contribution % 0.0% 4.0% 0.0% 0.0% 4.0% Projected Account Balance $1,792,000 $1,820,000 $1,925,000 $2,216.000 $2,279,000 Change vs. Stay the Course

$28,000

$133,000 $424,000 $487,000 Projected Income Replacement Ratio 61.0% 61.8% 64.6% 73.4% 75.1% Change vs. Stay the Course

0.8%

3.6% 12.4% 14.1%

Participant 3 Scenario:

64 years old Saving horizon 37 years (joined RPB at 30; retires at 67) $1.4 million RPB balance* Contributions: 13.4% employer / 0% employee

*as of 8/30/18

SLIDE 40

Scenarios Summary

Increasing contributions has greater impact the earlier you do it Delaying retirement and/or lowering income needs most effective for those nearing retirement (ages 56–65)

Age Stay the Course Increase Contrib. 2% Increase Contrib. 4% Delay Retirement 1 Year Delay Retirement 2 or 3 Years Maximize Income Replacement Ratio Result

45 64% 68% 72% 68% 73% (2 yrs) 77% (Increase cont. 4%, Delay 1 yr) 13% better 58 62% 64% 65% 67% 77% (3 yrs) 80% (Increase cont. 4%, Delay 3 yrs) 18% better 64 61% Negligible 62% 65% 73% (3 yrs) 75% (Increase cont. 4%, Delay 3 yrs) 14% better

Actions Outcomes

SLIDE 41

Actions You Can Take

Active Retired

1. Increase contributions

x

2. Delay retirement

x

3. Delay social security

x

4. Reduce retirement spending

(lower income replacement ratio) x x

5. Reduce debt

x x

6. Review asset allocation/rebalance

x x

After you calculate your retirement budget and estimate your gap, you can take action:

KEEP IN MIND:

Regardless of employer contributions, contribute as much as affordable up to IRS limits.

SLIDE 42

Active and Retired Participant Feedback

65% of active participants are confident that they’re saving enough and investing appropriately to achieve their retirement savings goal. 87% of retired participants feel that they have saved enough and invested appropriately. 91% of retirees said they’re able to live the retirement lifestyle they expected.

SLIDE 43

Summary

RESOURCES:

RPB Annual Retirement Planning Seminar

May 19-21, 2019 San Francisco

Retirement planning calculators: rpb.org/calculators
LifeWorks: 800-533-5690

SLIDE 44

Q&A

SLIDE 45

Retirement Readiness Assumptions

The returns presented were applied to each participant’s current account balance and asset allocation.
Returns based on asset allocation policy of each RPB fund and Summit’s asset class-specific return assumption over the three periods.