unbc retirement savings plan defined contribution pension
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TRANSCRIPT
UNBC Retirement Savings Plan
Defined Contribution Pension Plan (DCPP)
why save? Getting started
my plan Your plan advantage
my investments Investment review Choosing your funds
my account Get involved
Saving for Retirement
How much money do you need for retirement?
Canadians need 65% to 80% pre-retirement income replacement
Retirement income
CPP/OAS
Home
Other Savings
Personal RRSP
UNBC Defined Contribution Pension Plan
primary
Where will your money come from?
supplement
secondary
• Indexing: Your CPP are indexed annually, OAS is indexed quarterly
• CPP payments are based on how much and how long you have contributed
• Request your CPP contributions & benefit statement from: www.hrsdc.gc.ca
• OAS payments are based on your Canadian residency
2008 CPP/QPP OAS
Maximum Monthly
$884.58/mth
($10,615/yr)
$502.31/mth
($6,027.72/yr)
Average
$480.86/mth
($5,770/yr)
$476.37/mth
($5,716/yr)
Government benefits
Benefits of starting early
Assumes a 6% rate of return
Insert Slide Title HereResponsibilities
Sponsor the plan
• Pension Committee• Plan design • Selecting Investment
Managers• Selecting funds• Selecting the
record keeper• Monitoring the plan
UNBC
Record keeping
• Preparing statements• Developing tools• Member education• Tracking your
investments• Tax receipts
Sun Life Financial
InvestmentManagers
Funds
• Performing research• Creating the fund• Selecting the stocks
or bonds• Buying and selling
You/member
Your Account
• Making contributions• Understanding
investments• Choosing investments• Monitoring savings and
investments• Filing personal
information updates• RRSP limits• Paying investment
management fees • Paying
withdrawal fees
Your RRSP limits
Lesser of 18%of previous
years earningsor $20,000
PensionAdjustment
(PA)*
UnusedRRSP
Room (if any)+-
$22,0002010
$21,0002009
$20,0002008
* Pension Adjustment (PA) shown on T4. Applies to DCPP contributions.
Registered Retirement Savings Plan (RRSP)
Where contributions are directed….
UNBC Registered Pension Plan
EmployeeCompulsory
UNBC
• 3% of earnings up to the YMPE• 5% above the YMPE• Additional Voluntary (no match)• Transfers-in allowed
• 8% of earnings up to the YMPE• 10% above the YMPE
YMPE = Yearly Maximum Pensionable Earnings, $44,900.
Registered Retirement Savings Plan (RRSP)
What does this mean to me ?
Assumption:
Mary earns $65,000 annually.
Mary $44,900 x 3% = $1,263.00Mary $ 7,900 x 5% = $ 395.00
UNBC $44,900 x 8% = $3,368.00UNBC $ 7,900 x 10% = $ 790.00
Total Benefit = $5,816.00
Registered Retirement Savings Plan (RRSP)
When do I own the funds?
Mary $44,900 x 3% = $1,263.00Mary $ 7,900 x 5% = $ 395.00
UNBC $44,900 x 8% = $3,368.00UNBC $ 7,900 x 10% = $ 790.00
Total Benefit = $5,816.00
Vesting
• Vesting refers to when you own the University contributions. You are vested after 2 years of continuous service with the University.• If you leave UNBC prior to 2 years of continuous service, contributions are not yours to take with you.• You always own your contributions.
Locking in
• Once you have been contributing into the DCPP for 2 years, the funds become locked in which means they are not available for you to use until you retire.
What happens if you…
Leave UNBC• Transfer your DCPP to:
• Locked in account with Sun Life Financial - CHOICES
• Locked in account at another financial institution
• A new employer (if permitted)
Retire from UNBC• Transfer your DCPP to:
• A LIF (Life Income Fund) with Sun Life Financial - CHOICES
• A LIF at another financial institution
• Purchase an annuity
What happens if you….What happens if you….
Understanding Fees
Fees in your plan range
High
1.32 %
Low
0.42%
Fund Management Fee(expressed as a % of fund assets you hold)
To view your specific management fees visit www.sunlife.ca/member
Annual Fees
$70.00
Fund Management %
0.70%$10,000
Example
Fund Management Fees at Dec. 31, 2007
Fund Name Total Fund Management
Fee
PH&N Balanced Pension Fund 0.70%
Beutel Goodman Balanced Fund 0.76%
McLean Budden Balanced Growth Fund 0.69%
McLean Budden Canadian Equity Fund 0.69%
Beutel Goodman Canadian Equity Fund 0.76%
Beutel Goodman Small Cap Fund 0.76%
McLean Budden Canadian Equity Growth Fund 0.68%
BGI S&P/TSX Composite Index Fund 0.48%
PH&N Bond Fund 0.69%
Fund Management Fees at Dec. 31, 2007
Fund Name Total Fund Management
Fee
CI American Value Fund 1.32%
BGI US Equity Index Fund 0.48%
McLean Budden US Equity Fund 0.74%
McLean Budden Global Equity Fund 0.70%
Sun Life Financial Money Market Fund 0.42%
SLA 1 YR Guaranteed Fund N/A
SLA 3 YR Guaranteed Fund N/A
SLA 5 YR Guaranteed Fund N/A
* Assumes a 5.75% real rate of return
Investment management
fee
Annual contributions
Years of contributions
2% $5,000 20
1.5% $5,000 20
1% $5,000 20
1.5%$157,752
1%$167,568
Total contribution: $100,000
2%$148,588
Ending balance
Low Fund Management Fees (FMF) make a difference
You get it all when you save through your company plan
Your piggy bank
Your savings account
Your personal RRSPs
UNBC
Lower investment management fees
Access to institutional fund managers
University contributions
Regular payroll contributions
Tax deductible & tax sheltered investment earnings
Immediate tax relief on your contributions
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Your steps to investing
1. Understand the basics•types of funds•risk vs. returns•importance of diversification
2. Determine what type of investor you are
3. Choose your funds •refer to the Investment Reports section through your online account
Understand risk vs. return
Bonds• Promise to repay debt
• Receives interest
• Various terms to maturity
• Government and corporate
Money market• Federal government debt
• Short term, less than 1 year
Balanced• Mix of cash, bond and equities
• Automatic diversification
Equities• Ownership in company
• Share in company profits
• Canadian or foreign
Growth of $100From Jan 1998 to Dec 2007
$247
$146
$184
$124
Source: Morningstar Research Inc.
$50.00
$100.00
$150.00
$200.00
$250.00
$300.00
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Consumer Price Index DEX 91-Day T-Bill Index
DEX Universe Bond Index S&P/TSX Composite Index
• Diversification: holding different types of investments in your portfolio• Lower your overall risk by: not putting all of your eggs in one basket
Diversify your investments
Asset Class
ManagerStyle
Sector
ForeignMarkets
Ways you can diversify
Think about investing outside of Canada
• Canada Revenue Agency now allows 100 % foreign content in your registered accounts
• Canada represents only 2-3% of the world stock market
• Some foreign markets have historically outperformed Canada over the long-term
• Consider investing outside of Canada as one way to diversify
Investment Manager approaches
Active
Objective is to outperform a market index based on research of current market conditions and
company prospectsActively buys and sells securities
in individual funds
Passive/Index
Simply buys and sells assets to match characteristics of an index, fund
performance should be similar to the index, i.e. S&P TSX
Fund Manager applies an Investment “style” to their approach
Fund Management Fees tend to be lower than an Active Fund Manager
Investment styles
Value
Focuses on stocks that a fund manager thinks are currently
undervalued in price and will eventually have their worth recognized by the market
Growth
Believes that the single most important thing driving stock prices
is rapidly rising corporate earnings -- and that's what they
look for
If the manager is right, the stockwill increase in price as others
in the market recognize the true value of the stock
If the manager is right, the company’sstock will increase in price as thecompany achieves business and
earnings growth
Investment styles
Garp
Growth at a reasonable price- looks for stocks of growth
companies that they can buy for a reasonable price
This is a combination of value and growth investing
Dollar cost averaging
Month Amount Price Units purchased
1 $250 $10 25
2 $250 $10 25
3 $250 $11 22.72
4 $250 $12 20.83
5 $250 $11 22.72
6 $250 $13 19.23
7 $250 $14 17.86
8 $250 $13 19.23
9 $250 $14 17.86
10 $250 $12 20.83
11 $250 $10 25
12 $250 $14 17.86
Total $3,000 Avg. price = $11.80 254.14
Market Value = $3,557.96Rate of Return = 18.59%
Dollar cost averaging
Your guide to choosing funds
• Complete the questionnaire in the Investment Risk Profiler online• www.sunlife.ca/member
• Review your fund choices
online through Morningstar®
• Select your funds according to your
risk tolerance
my money Investment Risk Profiler
Your investment fund choices
Asset Class Fund Name RiskFund
Management Style
Money Market/
Guaranteed
• Sun Life Financial 1, 3 & 5 Year Guaranteed• Sun Life Financial Money Market Fund
Low
Low
N/A
N/A
Fixed Income/Bond
• PH&N Bond Fund Low Moderate Active/GARP
Balanced • PH&N Balanced Pension Fund• McLean Budden Balanced Growth Fund• Beutel Goodman Balanced Fund
Moderate
Moderate
Moderate
Active/GARP
Active/Growth
Active/Value
Canadian Equities • Beutel Goodman Small Cap Fund• Beutel Goodman Canadian Equity Fund• BGI S&P/TSX Composite Index Fund• McLean Budden Canadian Equity Growth Fund• McLean Budden Canadian Equity Fund
High
Moderate High
Moderate High
Moderate High
Moderate High
Active/Value
Active/Value
Passive
Active/Growth
Active/GARP
US Equities • BGI US Equity Index Fund• McLean Budden US Equity Fund• CI American Value Fund
Moderate High
Moderate High
Moderate High
Passive
Active/Growth
Active/Value
Foreign
Equities
• McLean Budden Global Equity Moderate High Active/GARP
Investment
Type
Investment Option
15% U.S. Equity • BGI US Equity Index Fund• McLean Budden US Equity Fund• CI American Value Fund
15% International Equity • McLean Budden Global Equity
20% Canadian Equity • Beutel Goodman Small Cap Fund• Beutel Goodman Canadian Equity Fund• BGI S&P/TSX Composite Index Fund• McLean Budden Canadian Equity Growth Fund• McLean Budden Canadian Equity Fund
40% Bond/
Fixed Income
• PH&N Bond Fund
10% Guaranteed/
Money Market
• Sun Life Financial Money Market Fund • Sun Life Financial 1,3 & 5 year Guaranteed Fund
Example: A score of 36 to 85 points - Moderate
15%U.S. Equity
20%CDN. Equity
40%Fixed Income
10%Money Market
15%Intl. Equity
Building your own asset mix
Rebalance often to match your risk tolerance
10%
International Equity
Canadian Equity
Bonds
45%Bonds 45%
Stocks
45% 45%
10%
35%Bonds
45%
Starting point5%
35% 60%
1 year later
Transfer:10% Cdn Equity to Bonds
5% Cdn Equity to International Equity
60%Stocks
5%
45%
10%
Starting point
45%
Fund 2007 2006 2005 2004 2003
Sun Life Money Market Fund
DEX 91 Day Cda Tbill
4.52%
4.43%
4.02%
3.98%
2.62%
2.58%
2.19%
2.30%
2.97%
2.91%
PH&N Bond Fund Fund
DEX Universe Bond
3.18%
3.68%
4.40%
4.06%
7.00%
6.46%
7.32%
7.15%
7.32%
6.69%
Beutel Goodman Balanced Fund
Beutel Balanced Benchmark
0.54%
2.61%
13.63%
12.23%
10.05%
11.24%
10.90%
9.34%
16.15%
14.65%
McLean Budden Balanced Growth Fund
McLean Budden Balanced Benchmark
2.09%
2.55%
13.63%
12.50%
11.36%
12.02%
8.45%
9.47%
14.43%
13.68%
PH&N Balanced Pension Fund
PH&N Balanced Pension Trust Benchmark
0.25%
3.42%
12.39%
12.56%
10.00%
12.27%
10.16%
9.30%
14.54%
13.82%
Beutel Goodman Canadian Equity Fund
S&P/TSX Composite
6.28%
9.83%
16.58%
17.26%
17.67%
24.13%
14.32%
14.48%
28.30%
26.72%
BGI S&P/TSX Composite Index Fund
S&P/TSX Capped Composite (BGI)
9.92%
9.83%
17.40%
17.26%
24.02%
24.13%
14.58%
14.48%
26.66%
26.72%
Fund Performance
Data through 31 Dec 2007
Fund 2007 2006 2005 2004 2003
McLean Budden Canadian Equity Fund
BMO/TSX Composite Capped 10%
8.34%
9.83%
18.26%
17.26%
21.19%
24.12%
12.15%
14.48%
25.30%
26.72%
McLean Budden Canadian Equity Growth Fund
BMO/TSX Composite Capped 10%
11.62%
9.83%
21.31%
17.26%
22.90%
24.12%
11.86%
14.48%
30.75%
26.72%
Beutel Goodman Small Cap Fund
BMO Small Cap Blended (Weighted)
2.97%
2.01%
22.33%
16.64%
11.16%
19.68%
14.69%
14.12%
38.19%
42.74%
BGI US Equity Index Fund
S&P 500 Index ( Cdn $)
-10.77%
-10.53%
15.06%
15.33%
1.97%
2.29%
2.52%
2.80%
4.38%
5.26%
CI American Value Fund
S&P 500 C$- Bank of Canada
-1.60%
-10.55%
18.68%
15.74%
5.24%
1.62%
12.15%
3.26%
4.76%
5.29%
McLean Budden US Equity Fund
S&P 500 C$- Bank of Canada
-4.80%
-10.55%
14.85%15.74%
2.95% 1.62%
3.90%
3.26%
7.41%
5.29%
McLean Budden Global Equity Fund
MSCI World C$
-7.85%
-7.08%
19.62%
20.19%
5.67%
7.27%
5.46%
6.85%
8.38%
9.41%
Fund Performance
Data through 31 Dec 2007
Dec. 31st 2007 Balances
% of Investment
Dec. 31st 2006 Balances
% of Investment
Balanced $12,358,144.03 30.75% $11,596,625.91 31.19%
B.G. Balanced Fund
MB Balanced Growth Fund
PH&N balanced Pension Fund
815,189.49
1,234,922.29
10,308,032.25
2.03%
3.07%
25.65%
478,042.37
855,795.05
10,262,788.49
1.29%
2.30%
27.61%
Canadian Equity $15,545,558.23 38.68% $11,596,625.91 38.11%
B.G. Canadian Equity Fund
B.G. Small Cap Fund
BGI S&P/TSX Composite Index Fund
MB Canadian Equity Fund
MC Canadian Equity Growth Fund
PH&N Canadian Equity Plus Pension Fund
1,002,926.87
2,304,544.48
1,781,376.34
8,534,858.68
1,921,851.86
n/a
2.5%
5.73%
4.43%
21.24%
4.78%
n/a
699,495.43
2,068,019.58
1,267,602.16
768,961.53
n/a
9,365,184.33
1.88%
5.56%
3.41%
2.07%
n/a
25.19%
Fixed Income $ 3,472,371.60 8.64% 3,008,464.95 8.09%
PH&N Bond Fund 3,472,371.60 8.64% 3,008,464.95 8.09%
Fund Asset Mix
Dec. 31st 2007 Balances
% of Investment
Dec. 31st 2006 Balances
% of Investment
Foreign Equity $ 3,572,203.81 8.89% $ 3,547,279.63 9.54%
BGI US Equity Index Fund
CI American Value Fund
MB Global Equity Fund
MB US Equity Fund
308,862.97
746,955.02
2,430,889.57
85,496.25
0.77%
1.86%
6.05%
0.21%
304,685.44
676,244.32
2,523,513.46
42,836.41
0.82%
1.82%
6.79%
0.12%
Guaranteed/Money Market $ 5,241,977.12 13.04% $ 4,853,648.21 13.06%
SLA 1 YR Guaranteed Fund
SLA 3 YR Guaranteed Fund
SLA 5 YR Guaranteed Fund
Sun Life Money Market Fund
375,439.68
494,678.12
766,575.20
3,605,284.12
0.93%
1.23%
1.91%
8.97%
311,296.45
535,513.10
826,819.01
3,180,019.65
0.84%
1.44%
2.22%
8.55%
Total $40,190,254.79 100.00 % $ 37,175,281.73 100.00 %
Fund Asset Mix
Saving for retirement
Select Resource Centre
Click on My Money Tools
Getting Started
Sign in to www.sunlife.ca/member
my information•This is the first screen of the retirement planner
•Some of the information on this screen is pre-populated
my money retirement planner
Your personal action plan
my money Retirement Planner
Keeping you involved
Read your personal statements
• Quarterly member statements
• Personal rates of return
• Transaction history
• Plan information
• Bulletin board
Keeping you involved
Education
Internetwww.sunlife.ca/member
Account Access Morningstar
• Investment Risk Profiler• Retirement Planner • Edu-cast• New personal financial
planning tools
• Account balances• Transfer between funds• Secure e-mail• RRSP receipts• On-line statements
• Investment reports
Manage your money on-line
Keeping you involved
Call 1-866-733-8612 for access to your account or help understanding your plan
Automated Telephone System
Phone
1-866-733-8612
Customer CareCentre
• Account balances• Rates of return• Market information• Enrolment assistance• Transfer between funds• Change investment allocation
Help is available in 150 languages
Investment Information• Capital market performance• Individual fund performance• Investment style, fund and manager updates
Portfolio X-Ray• Analyze different combinations of funds as a single portfolio; including the
effect of asset allocation changes to the portfolio
Fund Compare• Compare and analyze funds in your plan with the full list of available funds
Performance Reports• Generate investment performance reports for your plan’s funds
Getting information about your funds (Morningstar®)
Keeping you involved
Withdrawal calculator
Capital Gains vs.RRSP calculator
Mortgage vs. RRSP calculator
RRSP Loancalculator
Do your financial planning online
Keeping you involved
Do your financial planning online
OAS claw-backcalculator
RRIF calculator
Annuity calculator
Your action plan
1. Use the Investment risk profiler to determine your recommended portfolio allocation
2. Use the Retirement planner to evaluate if your current contributions will meet your retirement goals
3. Review your current portfolio
4. Update your future investment instructions as required
5. Update your existing portfolio as required
6. Update any personal information that is out of date (ie. Beneficiary)
Thank you
Questions?