and how to make it grow Northern British Pension Plan

Transcription

1 my money* * and how to make it grow University of Northern British Columbia Defined Contribution Defined Contribution Pension Plan

2 Agenda Sun Life Financial update Your plan Plan member activity Investments and fees Paying attention

3 Sun Life Financial Leads the capital accumulation plan business in Canada One-third market share About $40 billion under administration 966,000 plan members Canadian Business Magazine s Top 20 Most Reputable Companies Global 100 Most Sustainable Corporations in the world

4 Financial strength important for GICs Financial strength ratings among the highest of insurers in North America Based on balanced portfolio and diversified businesses Ratings as at December 31, 2010

5 What s new? mysunlife.ca Change Investments wizard Change your existing balance and future contributions at the same time -friendly sign-on option Change user ID to address Fund name change McLean Budden Responsible Balanced Fund

6 Responsibilities University of Sun Life Investment You Northern BC Financial Managers Sponsor the plan Record keeping Funds Your Account Plan design Selecting Investment Managers Selecting funds Selecting the record keeper and other suppliers Monitoring the plan Member education Ongoing member information & communication Preparing statements Developing saving and investment tools Provide member information sessions Assist with compliance Performing research Creating the fund Selecting the stocks or bonds Buying and selling securities Making contributions Understanding investments Choosing investments Monitoring savings and investments Filing personal information updates Paying fees

7 UNBC DC Plan 2011 contributions UNBC Registered Registered Retirement Savings Plan Pension (RRSP) Plan Employee Compulsory 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 2011 YMPE = Yearly Maximum Pensionable Earnings = $48,300

8 Doing the math Assumption: Mary Registered earns Retirement $65,000 Savings Plan annually (RRSP) Mary $48,300 x 3% = $1, Mary $16,700 x 5% = $ UNBC $48,300 x 8% = $3, UNBC $16,700 x 10% = $1, Total Benefit = $7,818.00

9 When is it your money? Vesting Vesting Registered refers Retirement to Savings when you Plan (RRSP) 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 Mary are $44,900 not yours x 3% to take with = you. $1, You Mary always own $ 7,900 your x contributions. 5% = $ Locking UNBC in $44,900 x 8% = $3, Once UNBC you have $ been 7,900 contributing x 10% into = the $ DCPP for 2 years, the funds become locked in which means they are not Total available Benefit for you to use until = you $5, retire.

10 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

11 UNBC DC Plan investments Member Count: 679 Member Count: 680 Assets: $44,162,830 Assets: $50,559,339 Foreign Equity 11.50% Fixed Income 8.43% Balanced 26.89% Foreign Equity 7.66% Fixed Income 11.98% Balanced 26.58% Canadian Equity 35.66% Guaranteed/ Money Market 17.52% Canadian Equity 38.60% Guaranteed/ Money Market 15.18%

12 MB US Equity rican Value Fund MB Global Equity dn Equity Growth BLK U K US Equity Index CI Americ MB Canadian Equity MB Cdn E Where are you investing? $10,000,000 $9,000,000 $8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 SLA 1 Year Guaranteed SLA 3 Year Guaranteed SLA 5 Year Guaranteed SLF Money Market BLK Bond Index PH&N Bond Fund BG Balanced Fund BonaV navista Balanced MB Balanced Growth MB Respon onsible Balanced BG Canadian Equity BG Small Cap Fund BLK S&P/ TSX Composite As at December 31, 2010

13 How many funds? Num mber of Members Number of Funds 2 As at December 31, 2010

14 Investments Risk vs. Return Canadian, US, & Foreign Equities Balanced Funds Bonds Guaranteed Guaranteed interest during fixed term Less long-term growth potential Money Market Government treasury bills (T-Bills) Less long-term growth potential Bonds (Fixed Income) Promise to repay debt Pays a rate of interest Government and corporate Equities (Stocks) Share in company profits Canadian, U.S. or Foreign Greater long-term growth potential Low Money Market Guaranteed Funds Balanced Funds One-stop shopping Automatic diversification Low Risk High

15 Growth of $10,000 $45,000 $40,000 $35,000 $30,000 Dot Com Crisis starts Credit Crisis $ 39,372 $ 27,370 $25,000 $20,000 9/11 $ 16,579 $15,000 $ 13,398 $10,000 $5,000 Dec 95Dec 96Dec 97Dec 98Dec 99Dec 00Dec 01Dec 02Dec 03Dec 04Dec 05Dec 06Dec 07Dec 08Dec 09Dec 10 Consumer Price Index TSX DEX Universe Bond Index TSX 91-day T-Bill Index S&P/TSX Composite Index

16 Year by year returns Fund Sun Life Money Market BlackRock Bond Index PH&N Bond Beutel Goodman Balanced BonaVista Balanced McLean Budden Balanced Growth McLean Budden Responsible Balanced BlackRock S&P/TSX Composite Index Beutel Goodman Canadian Equity McLean Budden Canadian Equity McLean Budden Cdn Equity Growth Beutel Goodman Small Cap BlackRock US Equity CI American Value McLean Budden US Equity McLean Budden Global Equity

17 my money Investment Risk Profiler Complete the on-line questionnaire at mysunlife.ca Review your fund choices online through Morningstar Select your funds according to your risk tolerance

18 Your investment options Asset Class Fund Name Risk Fees Money Market/ Guaranteed Sun Life Assurance 1, 3 & 5 Year Guaranteed Sun Life Financial Money Market Low Low None.39% Fixed Income/Bond BlackRock Bond Index PH&N Bond Fund Low Moderate Low Moderate.44%.66% Balanced Beutel Goodman Balanced BonaVista Balanced Moderate Moderate.73% 1.54% McLean Budden Balanced Growth McLean Budden Responsible Balanced Moderate Moderate.64%.71% Canadian Equities BlackRock S&P/TSX Composite Index Beutel Goodman Canadian Equity Moderate High Moderate High.44%.73% McLean Budden Canadian Equity McLean Budden Canadian Equity Growth Beutel Goodman Small Cap Moderate High Moderate High High.65%.64%.73% US Equities BlackRock US Equity Index Moderate High.45% CI American Value McLean Budden US Equity Moderate High Moderate High 1.25%.71% Foreign Equities McLean Budden Global Equity Moderate High.67%

19 Build your own asset mix Example: A score of 36 to 85 points - Moderate 15% Intl. Equity 10% Money Market Investment Investment Option Type 15% U.S. Equity BlackRock US Equity Index 15% U.S. Equity 40% Fixed Income 15% International Equity McLean Budden Global Equity 20% Canadian Equity Beutel Goodman Canadian Equity 20% CDN. Equity 40% Bond/ BlackRock Bond Index Fixed Income PH&N Bond 10% Guaranteed/ Money Market SLF Money Market

20 Rebalance often to match your risk tolerance Starting point 1 year later Starting point 10% 10% 5% 5% 10% 45% 45% 45% Bonds 45% Stocks 35% 60% 35% Bonds 45% 45% 60% 45% Stocks Transfer: 10% Cdn Equity to Bonds 5% Cdn Equity to U.S. Equity U.S. Equity Canadian Equity Bonds

21 Lower fees make a BIG difference FMF (Fund Management Fee) Your fee range 0.39% to 1.54% Average Canadian Retail Fees (2010)* (by asset category) Canadian Money Market: 0.72% Canadian Fixed Income: 1.70% Canadian Equity: 2.42% U.S. Equity: 2.50% International Equity: 2.45% Global Equity: 2.69% Assumes a 5.75% total rate of return *Source: Globefund.com

22 Accessing your account

23 Online services Online Advantage Informational Transactional Educational

24 Fund information from Morningstar Morningstar can be accessed by selecting Investment Performance from the Accounts menu

25 Investment Information

26 my money Retirement Planner If you re not sure how much money you need to set aside for your desired lifestyle in retirement, the my money Retirement Planner can help The planner lets you determine: How much you need to save now to provide you with your desired income level in retirement You can adjust a number of variables as they change over time by updating your calculations in the retirement planner

27 my money Retirement Planner Select Resource Centre Click on My Money Tools

28 my money Retirement Planner my information This is the first screen of the retirement planner Some of the information on this screen is pre-populated

29 my money Retirement Planner my assets Enter any additional assets or income you have You can include pensions from previous employers

30 my money Retirement Planner my lifestyle A lifestyle is suggested based on your personal information You can view information on other lifestyles Select your lifestyle and receive Select your lifestyle and receive your personal action plan

31 my money Retirement Planner Your personal action plan

32 More on-line tools Planning Tools Withdrawal calculator Capital gains vs. RRSP calculator Mortgage vs. RRSP calculator RRSP loan calculator Tax calculator for non-residents Retirement Tools Annuity premium calculator Old Age Security clawback calculator Registered Retirement Income Fund (RRIF) Calculator

33 Keeping you involved Read your personal statements Quarterly online Easy to read Personal rates of return Summary of all plans Transaction history Plan information Bulletin board

34 HST affecting your fees Harmonized sales tax (HST) update Went live in BC on July 1, 2010 HST charged on asset based fees To plan member based on address Because of differences in provincial rates, GST/HST no longer part of fee disclosure

35 Newsletters my money At a Glance Lessons from the market downturn (Oct 2010) Sorting out the retirement savings superhighway (Nov 2010) Fend off risks to your retirement (Dec 2010) Receive RSS update notifications for At a Glance

36 Retiring Soon? Newsletter my health: Combining conventional medicine with natural treatments my wealth: Adjusting to your retirement income my leisure: Travel South America

37 Sun Life Financial is here to help! Customer Care Centre Internet 24 hour automated phone account access Representatives available every business day (6 am to 6 pm ) Account updates 150 languages supported Receive up-to-date account balances View transaction history Make investment changes Link directly to investment reports View online member statements Call for enrolment assistance or web shadowing Are you on track for the retirement you want? Try out our retirement income planner.

38 Questions?? Thank you!