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Plan for life Create a presentation 1 To create your presentation, please select the plan type, whether or not TFSA is included, the enrolment type, and.

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Presentation on theme: "Plan for life Create a presentation 1 To create your presentation, please select the plan type, whether or not TFSA is included, the enrolment type, and."— Presentation transcript:

1 Plan for life Create a presentation 1 To create your presentation, please select the plan type, whether or not TFSA is included, the enrolment type, and the investment solution:

2 Enrolling in your group program Plan for life

3 Company name Broker/Advisor and Logo Date

4 Plan for life Broker/advisor name xxxxxxxxxxxxxxxxxxx Xxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxx 4

5 Plan for life Key topics Enrolling today Contributions Investments Guidance Questions and answers 5

6 Plan for life How do you feel about your retirement? 6

7 Plan for life Did you know? 7 70% of employees approaching retirement are concerned with having enough income to cover essential expenses (home, food and other basic needs) throughout their retirement Source: Crunch Research Insights & Advice conducted for The Standard Life Assurance Company of Canada, Retirement transition needs, August 2012

8 Plan for life A dollar a day 8 $3,351 $8,810 $17,701 *The calculations are based on 5% rate. $20,000 $15,000 $10,000 $5,000 $0

9 Plan for life How much do I need? 9 Experts suggest you will need to replace 70% of your salary. Keep in mind, your income will come from three sources: Government programs (Old Age Security, Canada or Quebec pension Plan) Your group savings and retirement program Your personal savings (real estate, other savings plans or income)

10 Plan for life Advantages of payroll deductions In the example below, saving $50 really only costs you $30 on your take home pay. And you pay less in tax. 10 5% = $50

11 Plan for life How much am I allowed to contribute? 11 Limit set by Canada Revenue Agency (CRA) 18% of your current year’s earned income* or the dollar maximum stipulated for the current year** - Your Pension Adjustment (PA) + Unused contribution room Note: It is your responsibility to monitor your limits Check your Notice of Assessment * For RRSP, it’s the previous year’s earned income ** The yearly limit can be found via the following website:

12 Plan for life Start now, save more. Regular contributions. 12 Same amount of money ($48,000), same investment return (5%), longer period of time… the savings almost double! You simply earn more by putting aside smaller amounts of money over a longer period of time. $100/month over 40 years $200/month over 20 years $148,856 $81,492

13 Plan for life Pay yourself first. 13 $600 $400 $510 $340 $150

14 Plan for life Your group program 14 Group retirement plan Registered Retirement Savings plan (RRSP) Employee contributions Employer contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information..

15 Plan for life Your retirement program 15 Group retirement plan Registered Retirement Savings plan (RRSP) Employee voluntary contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information.

16 Plan for life Your retirement program 16 Group retirement plan Deferred Profit Sharing Plan (DPSP) Employer Contributions No employee Contributions allowed Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information.

17 Plan for life Your retirement program 17 Group retirement plan Defined contributions registered pension plan (DC – RPP) Employer contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information. Employee Contributions (if applicable)

18 Plan for life Your retirement program 18 Group retirement plan Simplified Pension Plan (SPP) Employer contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information. Employee Contributions (if applicable)

19 Plan for life Your retirement program 19 Group retirement plan Deferred Profit Sharing Plan (DPSP) Registered Retirement Savings Plan (RRSP) Employer contributions Employee contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information.

20 Plan for life Your retirement program 20 Group retirement plan Defined contributions registered pension plan (DC – RPP) Registered Retirement Savings Plan (RRSP) Employer Contributions Employee Contributions (if applicable) Employee Contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information.

21 Plan for life Your retirement program 21 Group retirement plan Simplified Pension Plan (SPP) Registered Retirement Savings Plan (RRSP) Employer Contributions Employee Contributions (if applicable) Employee Contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information.

22 Plan for life A simple, flexible arrangement whereby your employer pays contributions, which amounts are based on the company’s profits. You are not allowed to contribute to the plan. Group buying power – favourable interest rates and lower investment management fees. Tax deferred compensation. Flexibility at termination and retirement – vesting to occur no later than 24 months after participation began. No locking-in rules. What is a DPSP?

23 Plan for life Termination or retirement (DPSP) At termination or retirement assets can be: –transferred to a RRSP –cashed out (minus the applicable taxes) –transferred to another DPSP or a Pension Plan (if permitted) –converted into an annuity, or a RRIF

24 Plan for life What is a DC-RPP? Contributions made by the employer, and in certain cases, the employee as well You are responsible for making the investment decisions within the plan Account value used to provide retirement income Amount of income you can expect is directly related to the amount of assets in your account at the time of retirement.

25 Plan for life What is a DC-RPP? Contributions made in accordance to a pre-defined formula specified in the plan rules Employee contributions are deducted from pay before income tax Employer contributions don’t constitute a taxable benefit for you until benefit payment Employer and employee contributions are generally locked-in, meaning that the assets can only be used to provided for a retirement income. Under certain conditions, the assets can be non locked-in. Vesting rules may apply 25

26 Plan for life Termination or retirement (DC-RPP) No withdrawals allowed during employment. At termination or retirement, vested contributions can be: –transferred to another Pension Plan (if that plan permits) –for locked-in assets: - transferred to a locked-in RRSP or LIRA - used to generate a retirement income through a LIF* –for non locked-in assets: - transferred to a RRSP - cashed out (minus applicable taxes) - used to generate a retirement income through a RRIF –converted into an annuity 26 *or other similar prescribed plans

27 Plan for life What is a SPP? Participation is voluntary or compulsory, as per plan rules Contributions made by the employer, and in certain cases, the employee as well Contributions made in accordance with a pre-defined formula specified in the plan rules Employee contributions are deducted from pay before income tax Employer contributions don’t constitute a taxable benefit for you until benefit payment Employer contributions are locked-in In Manitoba, employee contributions are locked-in. In Quebec, they are generally not locked-in unless specified in the plan rules. Immediate vesting 27

28 Plan for life Termination or retirement (SPP) At termination or retirement assets can be: –transferred to another Pension Plan (if that plan permits) –for locked-in assets: - transferred to LIRA - used to generate a retirement income through a LIF* –for non locked-in assets: - transferred to a RRSP - cashed out (minus applicable taxes) - used to generate a retirement income through a RRIF –converted into an annuity 28 * or other similar prescribed plans

29 Plan for life What is a Group RRSP? The advantages of a Group RRSP: A convenient, disciplined savings program through payroll deduction Immediate tax reductions Dollar cost averaging reduces investment risk Group buying power – favorable interest rates and lower investment management fees Income-splitting opportunities* 29 *If spousal account available under your program

30 Plan for life Termination or retirement (Group RRSP) At termination or retirement assets can be: –transferred to another RRSP –cashed out (minus the applicable taxes) –converted into an annuity, or a RRIF 30

31 Plan for life Your contributions Your tax deduction Account in your name Your contributions Your tax deduction Account in spouse’s name Employee account Spousal RRSP account Spousal account Group RRSP

32 Plan for life Comparison of splitting retirement income RRSPIncomeTaxes paid*Money kept Spouse #1$50,000$15,073$34,927 Spouse #2000 Income splitting Spouse #1$25,000$5,096$19,904 Spouse #2$25,000$5,096$19,904 Total$50,000$10,192$39,808 Spousal RRSP account * We assume that the hypothetical tax rates are % and %.

33 Plan for life Your group program - savings 33 Group savings plan Tax-Free Savings Account (TFSA) Employee voluntary contributions Review the document in your enrolment kit that states the main provisions of your program for more plan details and other important information.

34 What is a TFSA? Capital gains and other investment income earned will not be taxed – even when withdrawn! Started January 1, 2009 with a contribution limit of $5,000 per year, indexed to inflation and rounded to the nearest $500 on a yearly basis TFSA withdrawals do not affect your eligibility and/or calculations for federal income- tested benefits and credits Carry forward unused contribution room for an indefinite period Choose from a variety of investment options much like those in your group retirement program TFSA assets can be transferred to a spouse upon death Effective savings vehicle for both short term and long term goals

35 Plan for life Investments Market-related funds Investments are not guaranteed Invest in a variety of securities Fixed Income Funds Balanced Funds Equity Funds Compound Interest Accumulator (CIA) Daily Interest Account (DIA) Guaranteed funds Little or no risk Lower rate of return over the long-term 35

36 Plan for life Fixed Income Funds -Invest in interest generating investments -Treasury bills, bonds, mortgages Equity Funds -Invest in equity or shares of corporations -Canadian equity, American, International Balanced Funds -Invest in a mixture of stocks and bonds -Portfolio changes as market conditions change Investments 36

37 Plan for life Your investor profile 37

38 Plan for life 38 Avenue Portfolios Investor profile Investment period Conservative >25 years Conservative years Conservative years Conservative 10 – 15 years Conservative 5 – 10 years Moderate >25 years Moderate years Moderate years Moderate years Moderate years Aggressive >25 years Aggressive years Aggressive years Aggressive years Aggressive years Moderate <5 years Aggressive <5 years Conservative <5 years Example: 24% Canadian equity funds 13% International equity funds 13% U.S. equity funds 50% Fixed income funds

39 Plan for life 39 Systematic Asset Rebalancing Rebalances your portfolio to ensure your level of risk always remains aligned to your investor profile. Activated when you pick an Avenue Portfolio but you can deactivate it at any time.

40 Plan for life 40 Lifecycle Movement Ensures that your investment mix remains appropriate as your investment period shortens Activated when you pick an Avenue Portfolio but you can deactivate it at any time More than years years 5-10 year year Less than 5

41 Plan for life Target Date Funds (TDF) 41 Series of funds based on anticipated retirement date Automatically risk- adjusted as you age Anticipated retirement date Retirement Fund TDF 2015 TDF 2020 TDF 2025 TDF 2030 TDF 2035 TDF 2040 TDF 2045 TDF 2050 TDF 2055

42 Plan for life Automatic risk adjustment 42 Sample illustration to show the general trend

43 Plan for life Yes if : You are not interested in selecting investment funds yourself You have little knowledge about investing You want the risk of your portfolio to decrease automatically as you approach retirement Is a TDF the right investment for you? 43

44 Plan for life Your investor profile 44

45 Plan for life Picking your own investments 45

46 Plan for life To find out more… Consult the back of your enrolment form for a complete list of fund options The “rates of return” and “fund summaries” can provide useful information to compare investment performance and any fees charged by the investment manager Your Investment options 46

47 Plan for life To find out more… Consult the back of your enrolment form for a complete list of fund options The “rates of return” and “fund summaries” can provide useful information to compare investment performance and any fees charged by the investment manager Your Investment options 47

48 Plan for life One page fund summaries Information on fund manager Objective, style of fund Top 10 holdings Portfolio composition Gross rates of return Fund summaries 48

49 Plan for life Your VIP Room and Retirement Calculator 49

50 Education Centre 50 Plan for life

51 Know your rights and responsibilities 51 It’s your right to receive information about: the features of your group program the investment options available to you the tools and services we offer It’s your responsibility to: use the information and tools provided by your employer and Standard Life seek information about the rules and features of your plan(s) choose contribution amounts and investments when and where applicable seek financial and legal advice

52 Plan for life 52 Key sections of your form – Personal information

53 Plan for life 53 Key sections of your form - Beneficiary designation

54 Plan for life 54 Key sections of your form – Payroll deduction

55 Plan for life 55 Key sections of your form – Sign and date

56 Plan for life 56 Key sections of your form – Investment instructions Sample illustration your form may look slightly different

57 Plan for life 57 Key sections of your form - Signature

58 Plan for life 58 Key sections of your form – Investment instructions Sample illustration your form may look slightly different

59 Plan for life 59 Key sections of your form - Signature

60 Plan for life Online enrolment 60

61 Plan for life Online enrolment 61

62 Plan for life Online enrolment 62

63 Plan for life Online enrolment 63

64 Plan for life Online enrolment 64

65 Plan for life Online enrolment 65

66 Plan for life Online enrolment 66

67 Plan for life 67 Online enrolment

68 Plan for life Online enrolment 68

69 Plan for life Account statements Summary of your account, detailed information about your plans Includes your Retirement checkup Sent directly to your home or available online in your VIP Room 69

70 Plan for life What you need to do? Read through the enrolment material provided Complete the investor profile questionnaire Choose an Avenue Portfolio or pick your own “à la carte” funds Complete the enrolment form(s) by the date set by your employer, who will then take care of forwarding the form(s) to Standard Life. 70

71 Plan for life What you need to do? Read through the enrolment material provided Complete the investor profile questionnaire Choose a target date fund or pick your own “à la carte” funds Complete the enrolment form(s) by the date set by your employer, who will then take care of forwarding the form(s) to Standard Life. 71

72 Plan for life What you need to do? Read through the enrolment material provided Complete the investor profile questionnaire Choose an Avenue Portfolio or pick your own “à la carte” funds Complete the online enrolment and return the beneficiary designation form(s) to Standard Life 72

73 Plan for life What you need to do? Read through the enrolment material provided Complete the investor profile questionnaire Choose a target date fund or pick your own “à la carte” funds Complete the online enrolment and return the beneficiary designation form(s) to Standard Life 73

74 Plan for life What you need to do? Read through the enrolment material provided Complete the investor profile questionnaire Choose an Avenue Portfolio or pick your own “à la carte” funds Complete the enrolment form(s) or the online enrolment, as well as the beneficiary designation form(s), by the date set by your employer. 74

75 Plan for life What you need to do? Read through the enrolment material provided Complete the investor profile questionnaire Choose a target date fund or pick your own “à la carte” funds Complete the enrolment form(s) or the online enrolment, as well as the beneficiary designation form(s), by the date set by your employer. 75

76 Plan for life Questions?

77 Plan for life 77 All digital assets such as images, sounds, footage and fonts contained in which were created by, licensed to or owned by Standard Life Canada and its affiliates are subject to license restrictions. Use of these assets outside of their original authorized purpose is prohibited without the written consent of the GDS, and may involve the disbursement of additional licensing fees. Failure to obtain this approval may result in legal action. Any additional usage of the asset from what was disclosed should be discussed with GDS to assure that the asset rights permit this use. GDS must be advised before transferring assets such as images, sounds, footage and fonts to a third party regardless of if they are original to Standard Life or purchased from an online bank. Questions?


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