This document discusses various retirement investment options including 401k plans, profit sharing contributions, and defined benefit plans. It also summarizes the differences between 401k safe harbor plans and profit sharing contributions. Additionally, it addresses investment risk and provides tools to assess risk tolerance and plan for retirement savings needs.

1. My Investment

2. • Safe Harbor 401k Plans
• Profit Sharing Contributions
• Traditional 401(k) Plan
• Defined-benefit Plans
• Cash Balance Plans
Lineup

3. SH vs. PSC- What’s the difference?
401k Safe Harbor Plan Safe Harbor 401k Plans (SH):
A Safe Harbor 401(k) Plan is a relatively new type of 401(k) Plan that automatically
meets certain IRS non-discrimination requirements, unlike a traditional 401(k) plan,
if the employer commits to making one of two types of employer contributions.
Profit Sharing Contributions (PSC):
An employer profit sharing contribution is a contribution made by the employer to an
employer sponsored qualified retirement plan. Eligible participants share in this
contribution based on a predetermined formula used to allocate this contribution
amount. The plan need not be a 401(k) plan, but if it is a plan participant need not
enter into a salary deferral arrangement to receive such a contribution. However,
there may be other requirements that an employee must satisfy such as being
employed on the last day of the plan year.

4. What is risk?

5. Risk tolerance is the degree to which you are comfortable with:
•Volatility of annual returns
•Likelihood and size of negative returns
In the long term:
•Higher returns typically come from taking more risk, but
•Need to be able to sleep comfortably at night?
The risk required to achieve your goals:
•What is my investment time horizon?
•What are my retirement income expectations?
•What is the value of additional sources of potential retirement
income?
Determining your risk profile

6. Two different risks need to be manage
1. Volatility of short term performance
•Assess your “risk tolerance”
•Diversify your portfolio to address market risk
and
2. Longevity Risk
•Risk of failing to accumulate sufficient assets to build
desired pension
•Not having sufficient assets to pay your desired pension
for life

7. When to re-evaluate your risk tolerance
Major life events such as:
–Marriage or divorce,
–Children are born, go to university, leave home, (return
home?)
–Debt levels change or net worth changes considerably
–Inheritances
–Death of a spouse
As your investment time horizon to retirement shortens
If your tolerance for risk changes for any other reason

10. Investing in volatile markets
Be patient and don’t panic
•Corrections are a normal part of the market. Markets eventually recapture
losses, reaching and surpassing former levels. This can present opportunities
for long-term investors
Work with your Financial Advisor
•Working with an advisor who is focused on helping you achieve lifetime
security. Consumers with well-balanced, disciplined investment plans, who have
taken the risk of market volatility into account when creating their investment
plans, should have minimal impact on long-term goals
Diversify
•A diversified portfolio with a variety of investments, can carry less risk
•During market volatility, members with proper asset allocation and disciplined
investment plans will be impacted less by short-term events

11. •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
Manager
Style
Sector
Foreign
Markets
Ways you can diversify
Allowed 100% foreign content

13. Investment Manager approaches
Active
Objective is to outperform a
market index based on research
of current market conditions and
company prospects (actively
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

14. 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 stock
will increase in price as others
in the market recognize the
true value of the stock
If the manager is right, the company’s
stock will increase in price as the
company achieves business and
earnings growth

15. Investment styles
GARP
Growth at a reasonable price
- looks for stocks of growth
companies that they can buy
for a reasonable price
Core
Fund manager includes both
growth and value styles
– objective is to
not allow any one style
overweight the other
This is a combination of value
and growth investing
By not allowing one style to
overweight they maintain
a neutral position

16. my money- Investment Risk Profiler
Assess your personal
risk tolerance by
completing the
investment risk profiler:
• online
• paper-based version

17. 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 Retirement Planner is one of many tools that you can use, in planning for your retirement, it
does not take the place of a real financial planner/advisor**
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.

18. Planning Tools
•Withdrawal Calculator
•Capital Gains vs. RRSP Calculator
•Mortgage vs. RRSP Calculator
•RRSP Loan Calculator
•Non Resident Tax Calculator
Retirement Tools
•Annuity Premium Calculator
•Old Age Security Calculator
•Registered Retirement Income Fund (RRIF) Calculator
Additional on-line tools to help

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