Investment Series Part 2: Managing Your Portfolio and Using Your Account Presented by: Debbie Rochester
Today s Agenda Understand Why We Invest Locate Investment Information Create and Review Your Plan Make Changes to Your Investments Learn Contribution and Tax Considerations Build a Withdrawal Strategy MERS of Michigan 3
Understand Why We Invest
Reach a Goal Like most things that grow, investments need regular care and attention. MERS of Michigan 5
Reach Retirement MERS of Michigan 6
Stay on Track Retirement MERS of Michigan 7
Locate Investment Information
General Investment Information MERS of Michigan 9
MERS Investment Menu Summary MERS of Michigan 10
MERS Individual Fund Sheets MERS of Michigan 11
Your mymers Account MERS of Michigan 12
Your Account Overview $44,776.48 2.78% 3.74% 0 $0.00 MERS of Michigan 13
Your Quarterly Statement - Overview MERS of Michigan 14
Your Quarterly Statement - Investments MERS of Michigan 15
Evaluate Your Asset Allocation MERS of Michigan 16 $44,776.48 3,471.0449 12.900 100.00%
Evaluate Your Asset Allocation, cont d Short-Term Investment Gains Contributions Long-Term $40,580.64 $2,625.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $1,570.84 $44,776.48 Contributions Investment Gains MERS of Michigan 17
Evaluate Your Fund Performance Available through 4/30/2018 2018 2018 April 30 3.74% These returns are calculated from 01/01/2018 thru 4/30/2018 2.78% 3.07% 3.74% 14.18% MERS of Michigan 18
Personal Fund Performance Factors used to calculate your personal rate of return. % MERS of Michigan 19
Create and Review Your Plan
Meet Mary & John Mary s Profile Current Age 30 Retirement Age 62 Income $46,000 Savings $42,500 Contribution Rate 10% Employer Match Up to 5% Risk Profile Conservative John s Profile Current Age 33 Retirement Age 65 Income $38,000 Savings $11,000 Contribution Rate 3% Employer Match Up to 5% Risk Profile Aggressive MERS of Michigan 21
Full Picture Report Builder MERS of Michigan 22
Enter Your Information Full Picture Report Builder Information already entered: Age Income MERS Benefits Information you may add: Spouse s Information Outside Accounts Other Contributions MERS of Michigan 23
Investment Approach Choose the investment approach that best fits how involved you want to be with your investments. MERS of Michigan 24
Risk Tolerance Assessment Determine how much risk you are willing to take MERS of Michigan 25
Sample Question MERS of Michigan 26
Suggested Investments Learn the investment strategy the Full Picture report builder creates for you. Mary s Current Strategy Mary s Suggested Strategy MERS of Michigan 27
Suggested Investments, cont d MERS of Michigan 28
Make Changes to Your Investments
Types of Investment Changes MERS of Michigan 30
Investment Changes Explained Current Account Balance: $44,776 ($22,388 for 50%) Future Contributions: $266.38 per pay MERS of Michigan 31
Rebalancing We ll do it all for you! 30% Bonds 50% Bonds 50% Stocks 70% Stocks MERS of Michigan 32
Learn Contribution & Tax Considerations
Contributions, Withdrawals and Taxes MERS of Michigan 34
Pre-Tax Contributions Taxes Withdrawal Money MERS of Michigan 35
Roth (After-Tax) Contributions Taxes Withdrawal Money MERS of Michigan 36
Tax-Free Contributions Withdrawal Money MERS of Michigan 37
Build a Withdrawal Strategy
Distribution Options Lump Sum Equal Payments As Needed MERS of Michigan 39
Withdrawal Factors Longevity Inflation Investments MERS of Michigan 40
Longevity 65-year-old Male 65-year-old Female 65-year-old Couple Life Expectancy 86 years 88 years 92 years Target Age to Save For 92 years 94 years 96 years Source: Society of Actuaries RP-2014 Mortality Tables. Life Expectancy is 50% of living to this age. Target Age to Save For is 25% of living to this age. MERS of Michigan 41
Inflation Expenses at Age 60 Impact of Inflation $7,136 $1,720 $4,031 $5,000 $5,000 $5,000 $5,000 60 70 80 90 Example shows the impact of inflation at 3% a year. MERS of Michigan 42
Investments Continue to reduce risk on your accumulated balance MERS of Michigan 43
Investments Should I move all of my retirement savings into the lowest risk investment? How Long Would Monthly Payments Last? 95 Years Old 86 Years Old 3.0% Return 5.5% Return Example: Participant retires at age 60, and draws down a $500,000 account balance by taking a $2,000 monthly payment, adjusting it upward with inflation at 3.0% each year. MERS of Michigan 44
Please Complete a Session Survey! Step 1: Locate and access the Schedule Icon Step 2: Select the session you just attended (look for correct date and time) Step 3: Scroll down and click Breakout Session Survey to complete the survey MERS of Michigan 46