A great way to prepare for the future

Transcription

1 A great way to prepare for the future Congratulations! You are eligible to join the Daymon Worldwide Inc. 401(k) Profit Sharing Plan Participating in the Daymon Worldwide Inc. 401(k) Profit Sharing Plan (the Plan ) is an excellent way to help prepare for your financial future while enjoying tax benefits along the way. The sooner you enroll in the Plan, the sooner you can: Take advantage of the convenience of payroll deductions Contributing to the Plan is easy. With automatic payroll deductions, contributions are taken directly from your paychecks. A choice of contribution types Your Plan offers two contribution types: traditional pre-tax contributions and Roth 401(k) after-tax contributions. Depending on the type of contributions you select, you can benefit from certain tax advantages. (See page 2 for more information about the contribution types available through your Plan.) Get paid to contribute You may be eligible for matching and profit sharing contributions to the Plan. (For more information, please see page 3.) Select your investment options Choose your own mix of investments, or consider the Advice Access service. Get started now! It s easy to enroll in the Plan. You just need to decide: 1) How much to contribute 2) How to invest Then contact Merrill Lynch, online or by phone, to enroll. Need help? Benefits OnLine Retirement & Benefits Contact Center Call Merrill Lynch between 8 a.m. and 7 p.m. Eastern on any day the New York Stock Exchange is open. Or, use Benefits OnLine s click to chat feature. Merrill Lynch makes available products and services offered by Merrill Lynch, Pierce, Fenner & Smith Incorporated (MLPF&S) and other subsidiaries of Bank of America Corporation (BofA Corp.). MLPF&S is a registered broker-dealer, member SIPC and a wholly owned subsidiary of BofA Corp. Investment products: Are Not FDIC Insured Are Not Bank Guaranteed May Lose Value

2 Key features of the Plan Eligibility and enrollment You will be immediately eligible to enroll upon your hire date. Enrollment contributions will begin as soon as administratively possible. Once you enroll, information about your account, as well as helpful tools and services, is available virtually 24/7 on Benefits OnLine at and by calling the Retirement & Benefits Contact Center at Please refer to page 9 for more information on accessing your account. Contributions Employee contributions You may contribute from 1% to 75% of your eligible compensation through regular payroll deductions in any combination of pre-tax and Roth 401(k) contributions. Plus, you may have your pre-tax contributions automatically increased by an amount you choose and at a frequency you choose, up to the Plan or IRS limits, whichever is less. Pre-tax contributions Pre-tax contributions reduce your current taxable income and any earnings on those contributions are tax-deferred, but distributions are fully taxable as ordinary income at the time of distribution. Roth 401(k) contributions Roth 401(k) contributions are made after taxes are withheld, but any potential earnings on Roth 401(k) contributions are tax-free if you take a qualified distribution. A qualified withdrawal or distribution is one that is taken at least five tax years after the year of your first Roth 401(k) contribution and after you have attained age 59½ (or upon disability or death). In deciding whether traditional 401(k) contributions or Roth 401(k) contributions are right for you, evaluate whether you expect your tax rate to be lower, the same, or higher when you take distributions. Another important factor is the impact that Roth 401(k) contributions may have on your current take-home pay. Benefits OnLine provides additional information about the Roth 401(k) feature and offers a modeling tool that allows you to create hypothetical scenarios using your personal information. You may change your contribution rate anytime. myfuture Get practical investment guidance and financial tips from this quarterly online newsletter. Contribution limits Your combined pre-tax and Roth 401(k) contributions cannot exceed the IRS limit of $18,000 for 2016 or the annual Plan limit of 75% of compensation, whichever is less. If you are age 50 or older during the calendar year you may be eligible to make an additional catch-up contribution of up to $6,000 for 2016, on a pre-tax or Roth 401(k) basis. Savers Tax Credit If you earn up to $30,750 a year in 2016 ($46,125 for heads of household and $61,500 if married, filing jointly), you may be eligible for a tax credit of 10% to 50% of each $1 you contribute on a pre-tax or Roth 401(k) basis, up to the first $2,000 you put into the Plan (Source: IRS. IR , October 21, 2015). Please consult with your tax advisor. 2

3 Employer contributions Daymon Worldwide Inc. will match a dollar for every dollar you contribute per pay period on a pre-tax and/or Roth 401(k) basis, up to the first 5% of eligible compensation. You will be eligible for the match after one year of service. The match includes a true-up feature to ensure that you receive the maximum company match for which you are eligible, regardless of the timing of your contributions. If your total annual contributions qualify for any match that you didn t receive on a per pay period basis, Daymon Worldwide will match those contributions during the first quarter of the following year. Rollovers You may roll over pre-tax contributions into this Plan from another qualified Plan, including: A previous employer s 401(k) plan A government 457 plan A 403(b) plan A SEP or Rollover IRA Be sure to consider the advantages and disadvantages of a rollover before requesting one. Investment direction You choose how to invest your money among the Plan s investment options. If you do not make an investment selection at enrollment, contributions will be invested in the Janus Balanced Fund, Class I, the Plan s Qualified Default Investment Alternative (QDIA). If your account was established before September 15, 2011, amounts defaulted into the Plan s prior QDIA, the PersonalManager feature of Advice Access, will continue to be invested according to Advice Access recommendations, unless you make an affirmative election to invest those assets in other investment options available under the Plan. You may move your investments out of the Janus Balanced Fund at any time into any other investment option available under the Plan. For more information about these options and all your investment options, please visit Benefits OnLine. Making investment changes You may change the way your future contributions will be invested as frequently as once daily. You may also transfer your accumulated savings from one investment option to another once daily. To make investment changes, go to Benefits OnLine, or call the Retirement & Benefits Contact Center. For details on how to access your account, see page 9. Advice Access Your Plan offers Advice Access, a valuable service that can aid you in making your investment decisions. Through Advice Access, you can get specific investment guidance for your account. Advice Access can monitor your progress toward your retirement goals and can update your investments periodically depending on the implementation method you select. To learn more about Advice Access, please see pages 6 7. Budget & Savings Calculator See how small changes to today s spending habits may really add up for retirement. go.ml.com/calc My Accounts Education Center Browse Articles Explore Videos Financial Calculators Planning Tools Equity Awards Education Education Center > Fincial Calcuiators BUDGET & SAVINGS How much could my account be worth in the future? How much will my investments grow at various rates of return? If I cut spending now, how much could it help me in the future? How much must I invest for how long to reach my goal? Should I take a lump-sum payout or payments over time? How much can I invest, given my spending? PAYCHECK PLANNING Calculate how much more you might have at retirement by spending a little less today. What will it take to save for a vehicle, home etc.? Enter Data View Results Help Current age 30 Age at retirement 62 Rate of Return 0.00 % Your state + federal tax rate % The following are suggestions only. You may use those provided or fill in other ways of reducing spending. waiting to buy a new car eating out buying fewer clothes taking fewer trips going to fewer movies 3

4 Loans You will be permitted to borrow against your vested account balance. The maximum amount you may borrow is the lesser of: (1) $50,000 minus your highest outstanding loan balance from the Plan during the past year, or (2) 50% of your vested account balance. The minimum amount you may borrow is $1,000. You may have one loan outstanding at a time. A non-refundable, loan initiation fee (currently $50) will apply to each loan you take. A loan maintenance fee (currently $50) will be charged annually for your outstanding loan. You can repay your loan by payroll deduction over a five-year period or less. Please carefully consider the advantages and disadvantages of taking a loan before doing so. Withdrawals While the Plan is intended to help you accumulate assets for your retirement, you can withdraw funds prior to your separation from service if you experience an extreme financial hardship provided you satisfy certain conditions, as defined by the Plan and in accordance with IRS regulations. Such a withdrawal would require you to cease making contributions to the Plan for a period of at least six months following receipt of the hardship withdrawal. Distributions You or your beneficiary may receive a distribution of your account balance following your separation from service due to: Retirement Termination of employment Total and permanent disability Death (the benefit goes to your beneficiary) With certain exceptions, a distribution can be directly rolled over from the Plan to an IRA or another employer s plan that accepts rollovers, which can provide for continued deferral of taxes. You have choices for what to do with your 401(k) or other type of plan-sponsored accounts. Depending on your financial circumstances, needs and goals, you may choose to roll over to an IRA or convert to a Roth IRA, roll over a 401(k) from a prior employer to a 401(k) at your new employer, take a distribution, or leave the account where it is. Each choice may offer different investment options and services, fees and expenses, withdrawal options, required minimum distributions, tax treatment, and provide different protection from creditors and legal judgments. These are complex choices and should be considered with care. Have you named your beneficiary? It s important to decide who would receive your 401(k) account in the event of your death. Go to > 401(k) Plan > Current Elections > Beneficiary Designations/Updates to name or change your beneficiary. Or, call your plan s toll-free number for a beneficiary designation form. 4

5 The importance of diversification When choosing your investments, you are encouraged to make the most of an important investment principle called diversification. Diversification refers to the spreading of money across a variety of investment options. investing in several investment options within the Plan, you can help reduce risk and potentially increase your chances of achieving more consistent returns because a decrease in the value of one investment could be offset by an increase in the value of another. The Plan offers a wide range of investment options, providing the opportunity to select a mix of investments to address your financial objectives and tolerance for risk. Diversification does not ensure a profit or protect against loss. How withdrawals and distributions are taxed Here is how your withdrawals and distributions are taxed. If you withdraw your pre-tax contributions and any associated earnings, taxes will be due upon withdrawal. You may also be subject to a 10% additional federal tax if you take a withdrawal before age 59½. Regardless of the contribution type you choose, taxes on company matching contributions and any earnings on these contributions are due upon withdrawal. You may also be subject to a 10% additional federal tax if you take a withdrawal prior to age 59½. Any earnings on Roth 401(k) contributions can generally be withdrawn tax-free if you meet the two requirements for a qualified distribution : 1) At least five years must have elapsed from the year of your initial contribution, and 2) you must have reached age 59½ or become disabled or deceased. If you take a non-qualified withdrawal of your Roth 401(k) contributions, any Roth 401(k) investment returns are subject to regular income taxes, plus a possible 10% additional federal tax if withdrawn before age 59½. ERISA Section 404(c) disclosure The Plan is intended to meet the requirements of Section 404(c) of the Employee Retirement Income Security Act of 1974, as amended ( ERISA ) and section (c)-1 of Title 29 of the Code of Federal Regulations. Fiduciaries of the Plan may be relieved of liability for any losses resulting from investment instructions given by participants or beneficiaries. Benefits OnLine Education Center Make smart, informed financial decisions with the help of articles, videos, calculators and planning tools. Managing your account You will receive an account statement every quarter. The statement shows your account balance as well as any contributions and investment gains or losses credited to your account during the reporting period. For your convenience, account statements and confirmations of the transactions you make in your account are available online. If you d like to eliminate hardcopy mailings, you can do so easily on Benefits OnLine at Once you log in, simply find the Useful Links heading (lower left of the screen) and click on Manage Online Delivery. With online delivery, you will receive an notification with a link to Benefits OnLine whenever a new statement and/or confirmation is available online. 5

6 Advice Access Advice Access is a service that offers professional investment guidance for your retirement planning decisions. The service is easy to use, it s personalized, and it can automate your retirement plan strategy. And, it s available at no additional cost to you. Advice Access helps answer these important questions: Will I have enough for my retirement? Advice Access forecasts the likelihood of reaching your retirement income goal with your current strategy, and recommends the adjustments that may be necessary in seeking to reach your goal. How much should I contribute to the Plan? Based on your personal financial circumstances, Advice Access recommends the percentage of your eligible compensation to contribute to the Plan. You can accept this recommendation or use your own contribution rate. How should I invest my contributions? Advice Access provides personalized recommendations on which of the Plan s investment options you should select, and what percentage of your contributions to invest in each. How Advice Access works Advice Access uses basic information to help determine the investment strategy that may be right for you. This information includes your age, current salary, account balance (if any), contribution rate, the company s matching contribution, projections about your retirement age, and the amount of income you will likely need in retirement. Based upon this information, Advice Access will recommend a strategy that includes a suggested contribution rate, an asset allocation, and specific investments. You have three choices for implementing your Advice Access strategy: PersonalManager, Portfolio Rebalancing or One-Time Implementation. What PersonalManager does In addition to investing your account through a mix of investments appropriate for you (after you accept your suggested strategy), the PersonalManager feature of Advice Access reviews your account approximately every 90 days. Then, based on any updates to your personal or financial information, Advice Access may implement a new investment allocation for your account to help you stay on track in seeking to reach your retirement income goals. If no changes are necessary, your portfolio will be rebalanced to keep it at its intended allocation. In addition, the funds in your account are reviewed on a quarterly basis to help ensure that they re still appropriate for the retirement strategies that Advice Access offers. What Portfolio Rebalancing does Your account will be rebalanced on a quarterly basis to keep your investment mix at its intended allocation. However, your account will not be reviewed for any possible changes to your investments. What One-Time Implementation does It lets you implement your strategy, but will not review or rebalance your account. With Advice Access you can also create your own portfolio and choose Portfolio Rebalancing to have your investment mix rebalanced on a regular basis, or create your own portfolio and have Advice Access implement it through One-Time Implementation. You can always change your implementation method at any time. Or you can stop using Advice Access at any time and make your own selections from the Plan s investment choices. What your retirement income might be When you log in to Benefits OnLine, you ll see a graph displaying your projected retirement income based on Advice Access recommendations. 6

7 The flexibility you need With Advice Access, you can receive a more tailored strategy by providing additional information about your personal and financial situation, such as: A spouse s salary and Social Security information Any IRAs or other investments you or a spouse may hold Expected income from other sources or holdings in another retirement plan Expenses you may be anticipating, such as college educations or elder care The more information you provide, the more tailored your recommendations can be. Any additional information you provide to Merrill Lynch is used only to provide you with investment recommendations tailored to your individual situation. This information is not made available to Daymon Worldwide, Inc. What Advice Access can do for you Recommend a contribution rate Recommend specific investments Consider your personal financial situation Consider changes in your financial situation Consider your savings and other investments outside the Plan Review and reallocate your account on a regular basis Rebalance your account on a regular basis Recommend a strategy for withdrawing your retirement assets Getting started with your strategy To get started, just log on to your Plan account on Benefits OnLine and select Get started now under Your Retirement Income Projection. You can also call Merrill Lynch and speak with a participant service representative. The Advice Access service uses a probabilistic approach to determine the likelihood that you may be able to achieve your stated goal and/or to identify a potential wealth outcome that could be realized. Additionally, the recommendations provided by Advice Access may include a higher level of investment risk than you may be personally comfortable with. You are strongly advised to consider your personal goals, overall risk tolerance, and retirement horizon before accepting any recommendations made by Advice Access. You should carefully review the explanation of the methodology used, including key assumptions and limitations, which is provided in the Advice Access disclosure statement. It can be obtained through Benefits OnLine or through a participant service representative. IMPORTANT: The projections or other information shown in the Advice Access service regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results and are not guarantees of future results. Results may vary with each use and over time. 7

8 Investment menu If you prefer to choose your own investments, here are the individual investment choices available to you in the Plan. Shown with each investment is its Lipper classification and symbol (if available). Investment choice Classification Symbol American New Perspective Fund (R4) Global Large-Cap Growth RNPEX BlackRock Equity Index Fund (I) 1,2 S&P 500 Index Funds N/A BlackRock Inflation Protected Bond Portfolio (I) Inflation Protected Bond Funds BPRIX Eaton Vance Income Fund of Boston (I) High Yield Funds EIBIX Goldman Sachs Small Cap Value Fund (I) Small-Cap Core Funds GSSIX Invesco Diversified Dividend Fund (R5) Multi-Cap Value Funds DDFIX Invesco Real Estate Fund (R5) Real Estate Funds IARIX Janus Balanced Fund (I) Mixed-Asset Target Allocation Moderate Funds JBALX Lazard International Strategic Equity Portfolio Fund (I) International Multi-Cap Growth LISIX Metropolitan West Total Return Bond Fund (I) Core Plus Bond Funds MWTIX MFS Mid Cap Value Fund (R5) Mid-Cap Value Funds MVCKX Oppenheimer Developing Markets Fund (Y) Emerging Markets Funds ODVYX Pioneer Fundamental Growth Fund (Y) Large-Cap Growth Funds FUNYX Prudential Jennison Mid Cap Growth Fund (Z) Mid-Cap Growth Funds PEGZX Prudential Stable Value Fund 2,3 Stable Value 4 N/A SSgA Russell Small Cap Index Collective Investment Fund (D) 1,2 Small-Cap Core Funds N/A Vanguard Intermediate Term Bond Index Fund (Admiral) 1 Core Bond Funds VBILX 1 It is not possible to invest directly in an index. 2 This investment option is not a mutual fund, registered under the Investment Company Act of A prospectus is not available and shares are not publicly traded or listed on exchanges. 3 Although this fund seeks to maintain a stable value, this investment option may experience fluctuations in its net asset value. 4 This is not a Lipper classification. Investing involves risk, including the possible loss of principal. Investments in foreign securities or sector funds, including technology or real estate stocks, are subject to substantial volatility due to adverse political, economic or other developments and may carry additional risk resulting from lack of industry diversification. Funds that invest in small- or mid-capitalization companies experience a greater degree of market volatility than those of large-capitalization stocks and are riskier investments. Bond funds have the same interest rate, inflation, and credit risks associated with the underlying bonds owned by the fund. Generally, the value of bond funds rises when prevailing interest rates fall and falls when interest rates rise. Investing in lowergrade debt securities ( junk bonds) may be subject to greater market fluctuations and risk of loss of income and principal than securities in higher rated categories. There are ongoing fees and expenses associated with investing. Bear in mind that higher return potential is accompanied by higher risk. 8

9 How to access your account Accessing your account is easy, day or night, no matter where you are. You can enroll in the Plan online or by telephone. You can also access information about your account, learn more about the Plan, perform transactions, and get the assistance you need to help plan for your future. Benefits OnLine: Log on to Benefits OnLine at the Plan s secure website for access virtually 24 hours a day, seven days a week. The first time you log on to Benefits OnLine, you will need to create a User ID and Password. You can create these in just a few minutes by clicking the Create your User ID now link and following the instructions. If you have already created your User ID and Password, just enter those in the Login boxes, click the Login button and you ll be taken to the My Accounts Page. Retirement & Benefits Contact Center: Call the Retirement & Benefits Contact Center at The Interactive Voice Response (IVR) system is available virtually 24 hours a day, seven days a week. Representatives are available Monday Friday, 8 a.m. to 7 p.m. Eastern, on all days the New York Stock Exchange is open. You will need a personal identification number (PIN), which will be mailed to you, to access your account by telephone. However, when you create a Password for Benefits OnLine, that Password automatically becomes your new PIN to use when calling the Retirement & Benefits Contact Center. For international calls, call collect at to speak to a participant service representative. For a telecommunications device for the deaf (TDD), call (same hours as above). Benefits OnLine Mobile The mobile-optimized website can keep you connected when you re on the go. It lets you check your account balances and individual investments, see your account s performance data, and receive important alerts and messages. The site is designed to work with most smartphones. Investors should consider the investment objectives, risks, charges and expenses of investment options carefully before investing. This, and additional information about the investment options, can be found in the prospectuses and, if available, the summary prospectuses, which can be obtained on Benefits OnLine at or by calling Merrill Lynch at Investors should read the prospectuses and, if available, the summary prospectuses carefully before investing. This material is only a general outline of the Plan. You are encouraged to read the Summary Plan Description to obtain more detailed information regarding the Plan s operation. This document gives you information you need to make educated decisions about joining the Plan and maintaining a Plan account. If a provision described in this outline differs from the applicable provision of the Plan documents, the Plan documents prevail. Neither Merrill Lynch nor any of its affiliates or financial advisors provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions. Unless otherwise noted, all trademarks and registered trademarks are the property of Bank of America Corporation Bank of America Corporation. All rights reserved. AR3BFKXS /2015