monitor money Strategic approach: Investing for the future Have enough money when you retire Three smart considerations In this issue

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1 Newsletter for Canada Life s segregated fund investors Winter 2012 monitor money Strategic approach: Investing for the future You invest to accumulate wealth for many different reasons. As you move closer to retirement you may have less time to recover from market volatility. Accumulating wealth is no longer enough protecting that wealth from market loss and tax exposure is equally important. Your advisor can provide you with many solutions to help you meet your savings goals and reduce taxes you pay. In this issue > Diversify with the Canada Life Real Estate Fund > Dividend investing makes sense even in current market conditions > Segregated fund rates of return > Guarantee your income for life Lifetime income benefit > Money Monitor notes Have enough money when you retire Providing the potential for growth on a tax-deferred basis is an advantage of registered retirement saving plans (RRSPs) over non-registered savings. Contributing early and often in an RRSP can help grow your wealth considerably more than in a tax-exposed investment. Despite understanding the advantages of an RRSP, many Canadians are not using RRSPs to their benefit. Three smart considerations Your retirement goal should be to save enough money to afford the lifestyle you want, when you want. This takes careful planning. Regardless of where you are in your retirement preparation, we have solutions to fit your needs. Continued on next page The Canada Life Assurance Company Newsletter for segregated fund investors: Winter 2012

2 Continued from front page Which option is best for you? 1. Start now it pays to invest early You can start contributing to your RRSP as soon as you start earning income. Because of the power of compound interest, smaller contributions for a longer period of time accumulate more than larger contributions for a shorter period. Consider Tim Start saving at age 25 Start saving at age 45 Tim invests $5,000 each year Continues to invest $5,000 a year for 40 years (until age 65) Tim contributes a total out-of-pocket amount of $200,000 over 40 years. Tim invests $10,000 each year (Doubles his annual contributions compared to the first example) Continues to invest $10,000 a year for 20 years (until age 65) Tim contributes a total out-ofpocket amount of $200,000 over 20 years. Results: Value of the RRSP at 65: Age 25 start: $820,238 Age 45 start: $389,927 By starting to save at age 25, assuming an annual growth rate of six per cent, by age 65, Tim accumulates 110 per cent more. The above example is for illustrative purposes only. Situations will vary according to specific circumstances. 2. Catch-up on saving RRSP loans can build retirement funds faster Since 1991, unused RRSP contribution has carried forward. This means your RRSP contribution limit for this year may be more than the annual maximum. With an RRSP catch-up loan, you borrow the amount up to your unused contribution room and structure your loan repayment to suit your budget. You ll receive a tax deduction for the RRSP contribution, which provides immediate tax savings. Plus, it can get you back on track to achieving your retirement goals and help you stick to your savings plan. Never underestimate the power of compounding. If you fundamentally believe the market will go up, wouldn t you rather contribute as much as possible today? Through your advisor, you have the choice between two RRSP loan providers when borrowing to invest in Canada Life segregated funds policies: National Bank of Canada and B2B Trust. B2B TRUST is a registered trade-mark of B2B Trust. B2B Trust is a wholly-owned subsidiary of Laurentian Bank of Canada. Loans are subject to credit approval. 3. Save taxes with a TFSA Most Canadians view their RRSP as the primary vehicle for long-term retirement savings but a tax-free savings account (TFSA) can also help, depending on your personal circumstances. A TFSA currently allows you to invest $5,000 a year without being taxed on the potential growth. While tax diminishes the future growth potential of your investments, a TFSA allows you to keep more money invested and working for your future. These tax savings, along with the flexibility of the TFSA account can enhance your savings strategy. Compare investment options Whether you contribute to a TFSA, RRSP or a nonregistered account depends on a number of factors. It s not that one is better than the other; rather they have different features and benefits. Your personal savings needs will help you and your advisor determine which type of investment is right for you. Income tax refund tips One of the easiest ways to maximize your RRSP contribution is to take any tax refund you may receive and use it towards your next year s RRSP contributions. If you ve taken a loan to make a lump-sum contribution, use your tax refund to pay down the loan. The Canada Life Assurance Company Newsletter for segregated fund investors: Winter 2012

3 Diversify with the Canada Life Real Estate Fund The Canada Life Real Estate Fund gives you access to the investment performance of large real estate properties, an alternative investment class that is not generally accessible to the average investor. Most people don t have the capacity to build a portfolio of large residential and commercial properties on their own. It s a segregated fund that invests in a diverse selection of income-producing Canadian real estate properties, and is made up of high-quality commercial and multi-family residential properties, diversified by type and located in Canada s major cities. This fund works as part of a well-diversified portfolio for these reasons: It is a unique diversifier for your investment portfolio Historically, returns have been stable Long-term income from properties contributes to returns It s professionally managed If you d like more information about this unique investment opportunity, contact your advisor. Dividend investing makes sense even in current market conditions A combination of bonds and equities helps investors increase the income component of their investment portfolio to help meet long-term investment goals. Historically, dividend funds have answered the call of many investors who were attracted to their solid returns, and who wanted relatively low volatility compared with other equity funds. These typical characteristics have made dividend funds a conservative equity choice for more risk-averse investors. But even dividend funds couldn t completely escape the stock market correction of 2008, or the effects of market volatility in Does this mean it s time to give up on this strategy? We don t think so. Even in the face of a challenging investment environment, very compelling arguments remain for dividend funds. Dividend equity investing an attractive opportunity in today s low-yield environment Bonds have traditionally been considered a main alternative to equities. However, in an environment where bond yields have dropped to very low levels, it s stock dividends that have rarely looked so attractive on a relative basis. As of Sept. 30, 2011, 10-year Government of Canada bonds were yielding 2.15 per cent. Compare this to the dividend yield on the S&P/TSX composite index of 2.9 per cent or to a dividend fund that aims to provide an even higher yield. A consistent income cushion from dividend-paying equities can help dampen market volatility. Does this mean there are no risks to a dividend strategy in today s environment? Certainly not. Companies are facing an uncertain environment and some companies are better positioned to weather this than others. In short, not all dividend-paying companies are equal. In this environment, discerning stock selection is more important than ever. It s during times like these the merits of professional portfolio management with disciplined investment processes shine through. Did you know? Dividends continue to account for a significant portion of equity market gains in Canada. Over the five years from Sept. 30, 2006 to Sept. 30, 2011, almost 40 per cent of the S&P/TSX composite index s total return came from reinvested dividends. Dividends can give quite a boost to equity market returns. (Source: Bloomberg) The views expressed in this commentary are those of GLC Asset Management Group Ltd. (GLC) as at the date of publication and are subject to change without notice. This commentary is presented only as a general source of information and is not intended as a solicitation to buy or sell specific investments, nor is it intended to provide tax or legal advice. Prospective investors should review the offering documents relating to any investment carefully before making an investment decision and should ask their advisor for advice based on their specific circumstances. GLC Asset Management Group Ltd. is a $30-billion investment manager offering a broad range of traditional and specialty investment mandates through three distinct investment management divisions GWL Investment Management, London Capital Management and Laketon Investment Management. Each division pursues its own unique investment style, process and philosophy. Learn more about GLC at

4 75/75 guarantee policy segregated funds rates of return At Nov. 30, 2011 Fund Number Unit value ($) Inception date 1-month 3-month YTD Compounded annual rates of return as of month-end 1-year 2-year 3-year 5-year 10-year From Inception Asset allocation funds Conservative Allocation S Oct n/a n/a n/a 3.05 Moderate Allocation S Oct n/a n/a n/a 3.05 Balanced Allocation S Oct n/a n/a n/a 4.15 Advanced Allocation S Oct n/a n/a n/a 4.68 Aggressive Allocation S Oct n/a n/a n/a 5.11 Income allocation funds Income Focus S Oct n/a n/a n/a 3.81 Income Growth S Oct n/a n/a n/a 4.19 Income Growth Plus S Oct n/a n/a n/a 4.50 Managed fund solutions Core Conservative Growth S Oct n/a n/a n/a 4.50 Fidelity Moderate Income S Oct n/a n/a n/a 3.83 Franklin Templeton Moderate Income S Oct n/a n/a n/a 3.68 Mackenzie Moderate Income S Oct n/a n/a n/a 4.32 Core Moderate S Oct n/a n/a n/a 4.37 Franklin Templeton Moderate Growth S Oct n/a n/a n/a 3.67 Mackenzie Moderate Growth S Oct n/a n/a n/a 4.04 Core Moderate Growth Plus S Oct n/a n/a n/a 4.37 Fidelity Moderate Growth Plus S Oct n/a n/a n/a 3.29 CI Balanced Income S Oct n/a n/a n/a 3.03 Franklin Templeton Balanced Income S Oct n/a n/a n/a 3.63 Mackenzie Balanced Income S Oct n/a n/a n/a 3.78 Core Balanced S Oct n/a n/a n/a 4.42 Fidelity Balanced S Oct n/a n/a n/a 3.00 Mackenzie Balanced S Oct n/a n/a n/a 3.54 Core Balanced Growth Plus S Oct n/a n/a n/a 4.26 Fixed income funds Money Market Fund (Laketon) S Oct n/a n/a n/a 0.13 Government Bond (GWLIM) S Oct n/a n/a n/a 2.10 Fixed Income (Laketon) S Oct n/a n/a n/a 4.34 International Bond (Laketon) 2 S Oct n/a n/a n/a 1.31 Income Opportunity (London Capital) S Oct n/a n/a n/a 5.18 Indexed Canadian Bond (TDAM) S Oct n/a n/a n/a 4.38 Balanced funds Canadian Growth & Income (AGF) S Oct n/a n/a n/a 0.34 Balanced (Bissett) S Oct n/a n/a n/a 4.52 Harbour Growth & Income (CI) S Oct n/a n/a n/a 1.38 Canadian Asset Allocation (Fidelity) S Oct n/a n/a n/a 3.23 Managed (Laketon) S Oct n/a n/a n/a 2.28 Balanced (Invesco Trimark) S Oct n/a n/a n/a 1.73 Balanced (Greystone) S Oct n/a n/a n/a 2.21 Maxxum Canadian Balanced (Mackenzie) 1 S Dec-10 n/a n/a n/a n/a n/a n/a n/a n/a n/a Saxon Balanced (Mackenzie) 1 S Dec-10 n/a n/a n/a n/a n/a n/a n/a n/a n/a Sentinel Income (Mackenzie) 1 S Dec-10 n/a n/a n/a n/a n/a n/a n/a n/a n/a Global Balanced (Mackenzie) S Oct n/a n/a n/a 3.91 Canadian equity funds Canadian Growth (Invesco Trimark) S Oct n/a n/a n/a 2.09 Canadian Equity (Bissett) S Oct n/a n/a n/a 6.01 Small Cap Equity (Bissett) S Oct n/a n/a n/a 7.10 Harbour Canadian (CI) S Oct n/a n/a n/a 2.39 Canada Life Fidelity True North S Oct n/a n/a n/a 4.07 Mid Cap Canada (GWLIM) S Oct n/a n/a n/a Canadian Equity (Howson Tattersall) S Oct n/a n/a n/a 2.08 Enhanced Dividend (Laketon) S Oct n/a n/a n/a 7.26

5 75/75 guarantee policy segregated funds rates of return At Nov. 30, 2011 Fund Number Unit value ($) Inception date 1-month 3-month YTD Compounded annual rates of return as of month-end 1-year 2-year 3-year 5-year 10-year From Inception Canadian equity funds Canadian Equity (Laketon) S Oct n/a n/a n/a 2.75 Canadian Equity Value (Laketon) S Oct n/a n/a n/a Dividend (London Capital) S Oct n/a n/a n/a 7.18 Canadian Equity (London Capital) S Oct n/a n/a n/a 0.86 Canadian Equity Growth (Mackenzie) S Oct n/a n/a n/a 3.46 Canadian Equity (Invesco Trimark) S Oct n/a n/a n/a 3.24 Canadian specialty funds Canadian Equity (AGF) S Oct n/a n/a n/a 5.32 Real Estate (GWLRA) S Oct n/a n/a n/a 5.83 Canadian Resource (Mackenzie) S Oct n/a n/a n/a Foreign equity funds American Growth (AGF) S Oct n/a n/a n/a 8.11 International Equity (CI) S Oct n/a n/a n/a Global Equity (Fidelity) S Oct n/a n/a n/a 0.03 Canada Life Fidelity American Disciplined Equity S Oct n/a n/a n/a 3.19 U.S. Value (London Capital) S Oct n/a n/a n/a 5.59 U.S. Growth Leaders (Mackenzie) S Oct n/a n/a n/a 6.50 Global Future (Mackenzie) S Oct n/a n/a n/a 1.81 Global Equity (Setanta) S Oct n/a n/a n/a 1.65 International Equity (Templeton) S Oct n/a n/a n/a Global Equity (Invesco Trimark) S Oct n/a n/a n/a 4.88 Cundill Global Value (Mackenzie) S Oct n/a n/a n/a Foreign specialty funds Canada Life Fidelity NorthStar S Oct n/a n/a n/a 1.98 Far East Equity (Mackenzie) S Oct n/a n/a n/a European Equity (Setanta) S Oct n/a n/a n/a Global Infrastructure Equity (London Capital) S Oct n/a n/a n/a Any amount that is allocated to a segregated fund is invested at the risk of the policyowner and may increase or decrease in value. A description of the key features of Canada Life s individual variable insurance contract is contained in the information folder, available from your advisor. The indicated rates of return for one, two, three, five and 10 years columns, as well as the From inception column, are annual compounded returns for the period ending Nov. 30, 2011, including changes in the unit values but does not take into account redemption fees or other applicable charges payable by the policyowner. The stated returns are net of the segregated fund management fees and operating expenses, but does not reflect redemption fees or other charges. Therefore actual returns will be less than illustrated. Please note unit values and investment returns will fluctuate and past performance is not necessarily indicative of future performance. Canada Life is currently waiving fees for direct expenses and/or a portion of the investment management fee for the Canada Life Money Market (Laketon) Fund. Returns of the fund would be negative without the waiver of these fees. We anticipate negative returns will continue for the foreseeable future. Canada Life is not obligated to continue waiving these fees and it may cease to do so at any time without notice. The amount of the waiver is disclosed every month at approximately mid-month and will be disclosed directly below once available. The annualized current yield and effective yield for the Canada Life Money Market (Laketon) Fund for the seven day period ending Nov. 30, 2011, are and per cent respectively. These are annualized historical yields based on the seven day period ending on Nov. 30, 2011, and does not represent an actual one year return. 1 New funds - cannot show performance data until fund is one year old. 2 Effective July 2011, Canada Life Asset Management Limited assumed portfolio management responsibilities for the segregated fund from GLC Asset Management Group Ltd. Canada Life Asset Management Limited is a subsidiary of Canada Life based in London, England. Canada Life and design and Canada Life Generations are trademarks of The Canada Life Assurance Company.

6 Guarantee your income for life Lifetime income benefit An innovative way to transition your hard-earned savings into income when you approach retirement is to consider a lifetime income benefit option. For years your focus has been to save for retirement. Now you need to move your savings into income that will last your lifetime. Protect your savings against retirement risks Longevity risk: You might outlive your money. The risk that you or your spouse might outlive your assets is something to consider during retirement planning. The lifetime income benefit can help provide predictable, guaranteed income, no matter how long you or your spouse lives. Joint-life income can protect couples from the risk of reduced income when a spouse dies. Market return risk: You could experience poor market returns in the early retirement years, increasing the chances you ll use all your savings sooner than you planned. The lifetime income benefit helps get you through this risk by guaranteeing the starting value on which your lifetime income will be based. You can increase your income amount by deferral bonuses earned in every year you defer making a withdrawal prior to taking an income. The lifetime income benefit puts you in control of your retirement savings and income by guaranteeing your income for life. By paying a small monthly premium, you protect retirement savings from potential risk. Consider it like having insurance associated with the investment. Your income won t decrease 1 regardless of how the segregated funds perform, which provides you with protection against the risks of longevity, market returns and volatility. The lifetime income benefit helps you manage these risks in retirement and protect your savings. The lifetime income benefit can help provide: Predictable, guaranteed income for life, beginning as early as age 50 Potential for increasing income Safe transition from savings to income Guaranteed income for life for you and your spouse The lifetime income benefit is most appropriate for people 10 to 15 years from retirement. Talk to your advisor today if you could benefit from guaranteed income for life. 1 Excess withdrawals will decrease the lifetime income amount and you will no longer be eligible for any future bonuses. An excess withdrawal is a withdrawal that exceeds the annual guaranteed income amount. Money Monitor notes RRSP contribution deadline Feb. 29, 2012 Your 2011 registered retirement savings plan (RRSP) contributions are due Feb. 29, Contributions dated after Feb. 29, 2012 will result in tax receipts for 2012 and not the 2011 tax year. Published rates of return uses the most current rates of return available at the time of publishing. For up-to-date rates of return on all Canada Life segregated funds, please visit A description of the key features of the segregated fund policy is contained in the information folder. Any amount that is allocated to a segregated fund is invested at the risk of the policyowner and may increase or decrease in value. In Quebec, advisor refers to a financial security advisor for individual insurance and segregated fund policies; and to an advisor in group insurance/annuity plans for group products. For more information about Canada Life and its products, visit or talk to your advisor. The Canada Life Assurance Company, 330 University Avenue, Toronto, ON M5G 1R8 Helping people achieve more Canada Life and design, Helping people achieve more and Canada Life Generations are trademarks of The Canada Life Assurance Company B-12/11