DISTINGUISH AND GROW YOUR PRACTICE WITH TAX-EFFICIENT INVESTING.

Bill Johnstone, Vice President, Sales & Marketing

AGENDA

• Investors are risk-averse

• Corporate Class structure

• Why Corporate Class?

• Investment options

• Tax efficiency with T-Class

• T-Class case study

• T-Class opportunities

INVESTORS ARE RISK-AVERSE

The continued concern about market volatility is causing flows out of equities and into bonds, which has persisted since the credit crisis began in 2007.

Source: Stragegas

INVESTORS ARE STARVING FOR YIELD AND LOOKING FOR ALTERNATIVE SOURCES OF CASH FLOW

Where are we today?

• 5-year GIC 1.63%

• 10-year U.S. Treasury Bill 2.79% • 10-year Government of Canada Bond 2.74%

• Investment-grade corporate bonds 2.7%

Bank of Canada, U.S. Department of the Treasury, Bloomberg, Barron’s economic data, August 2013

TWO TYPES OF FUNDS

WHY CORPORATE CLASS?

• Tax-deferral advantages of an RSP and TFSA (on switching).

• Ability to lock in investment gains without triggering a taxable event and defer tax on investment income and capital gains.

• Increased compound growth over the long term.

• Control when you pay tax on your investment.

• Ability to draw tax-efficient cash flow from your investments with T-Class.

CI CORPORATE CLASS

CI has designed and manages a tax-effective corporate class fund structure with:

• Diversification of asset classes to help offset capital gains and losses.

• A larger weighting of equities to fixed income so that interest income

is better offset by expenses.

• The ability to allocate distributions among all classes of funds.

INVESTMENT OPTIONS

Investment choice with leading portfolio managers

SUSTAINABLE YIELD – THE TAX EFFECTIVE WAY

• Not only can clients access cash flow through our numerous mandates, but they can do so tax-free!

• T-Class can be customized to any monthly amount or percentage between 0.25% and 8% per year.

TAX EFFICIENCY

1 Assumes a marginal tax rate in Ontario of 46.41% as of 2012.

The difference in the after-tax value of $10,000 in income from interest, dividends, capital gains and return of capital1

Investment options

T-CLASS PAYMENT LONGEVITY

$250,000 invested in T-Class 8% (T8), where the client requires $1,000 per month or $12,000 for the year.

Year Return Market Value T8 Payout Requested $ Excess $1 5% $250,500 $20,000 $12,000 $8,0002 12% $268,560 $20,040 $12,000 $8,0403 -17% $210,905 $21,485 $12,000 $9,4854 8% $215,777 $16,872 $12,000 $4,8725 -7% $188,673 $17,262 $12,000 $5,2626 2% $180,446 $15,094 $12,000 $3,0947 15% $195,513 $14,436 $12,000 $2,4368 20% $222,616 $15,641 $12,000 $3,6419 4% $219,520 $17,809 $12,000 $5,809

10 8% $225,082 $17,562 $12,000 $5,56211 -4% $204,079 $18,007 $12,000 $6,00712 11% $214,527 $16,326 $12,000 $4,32613 6% $215,399 $17,162 $12,000 $5,16214 1% $205,553 $17,232 $12,000 $5,23215 -2% $189,442 $16,444 $12,000 $4,44416 9% $194,492 $15,155 $12,000 $3,15517 3% $188,327 $15,559 $12,000 $3,55918 -3% $170,677 $15,066 $12,000 $3,06619 7% $170,624 $13,654 $12,000 $1,65420 10% $175,687 $13,650 $12,000 $1,650

Payments are Made the last Friday of each month

SUSTAINABLE YIELD – THE TAX EFFECTIVE WAY

• T-Class pays out regular monthly distributions of tax-free return of capital (ROC) to clients.

• T-Class is offered in two versions: – T5, provides 5% ROC per year

• As of 2011 it can be customized to any monthly dollars or percentages between 0.25% and 5% per year.

– T8, provides 8% ROC per year• As of 2011 it can be customized to any monthly dollars

or percentages between 0.25% and 8% per year.

T-CLASS CASE STUDY

Clients requiring additional retirement cash flow

– Require supplementary cash flow over and above their registered investments while minimizing the impact on income-tested benefits.

SUPPLEMENT RETIREMENT CASH FLOW

• Great for clients who need additional cash flow over and above their pension, RRSP or TFSA.

• T-Class’ ROC does not affect income-tested benefits like: – Old Age Security– Age Amount Tax Credit– GST/HST Tax Credit

SUPPLEMENT RETIREMENT CASH FLOW

• Assume client is receiving $70,000/year from their pension and RSP accounts.

• Let’s assume the client has $250,000 in their non-registered account.

• They need an additional $12,500 from their non-registered account.

• How does $12,500 from T-Class vs. Corporate Class affect cash flow and income-tested benefits?

SUPPLEMENT RETIREMENT CASH FLOW

• Each year client withdraws 5% in ROC or $12,500

250,000$ 237,500$ 225,000$ 212,500$ 200,000$ 187,500$ 175,000$ 162,500$ 150,000$ 137,500$ 125,000$ 112,500$ 100,000$

87,500$ 75,000$ 62,500$ 50,000$ 37,500$ 25,000$ 12,500$

$01 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Capital Gains

Years

Original Capital

Assumes a constant 5% annual rate of return.

SUPPLEMENT RETIREMENT CASH FLOW

T-Class Corporate Class

T-Class provided $17,287 more cash flow and $7,455 more in

OAS and Age Tax Credit

Over 20 Years

$ 250,000Tax-free Return of

Capital

T-CLASS OPPORTUNITIES

• There are 11,000 open accounts with SWPs / AWDs

– 3,000 of those accounts are Corporate Class funds.

– The average AWD is $1,000/month. • That’s $12,000/ year

– In the previous example at $12,500/year, we added over $20,000 in additional cash flow over 20 years through T-class.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

®CI Investments, the CI Investments design, Cambridge, Synergy Mutual Funds, Harbour Advisors, Harbour Funds are registered trademarks of CI Investments Inc. ™Portfolio Select Series, Portfolio Series, Signature Global Asset Management, Signature Funds are trademarks of CI Investments Inc.

Thank You

FOR ADVISOR USE ONLY