JANUARY 2012 RRSP planning – Information you need to make the right RRSP decisions

2 What is a Registered Retirement Savings Plan? A Registered Retirement Savings Plan (RRSP) is a registered account that allows you to defer taxes on the growth of your investment. It is available to Canadians who have qualified earned income.

3 What are the benefits of an RRSP? Contributions are tax-deductible. The income earned and growth generated by the investments in your RRSP is tax sheltered until withdrawn. At age 71, you can transfer your accumulated RRSP into a variety of RRSP maturity options.

4 RRSP (registered) vs. non-registered Source: Mackenzie Investments RRSP Calculator. Assumes a rate of 8% compounded annually. Marginal Tax Rate 40%. RRSP versus non-RRSP 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90, , , Final Value in $ YEARS TO RETIREMENT RRSP Non-RRSP For illustration purposes only.

5 When should I start? The earlier you start the better. The longer your savings grow within a tax-sheltered structure like an RRSP account, the more you benefit from the effects of compound investment returns. Contributions may be deducted in the calendar year that they are received. Contributions made during the first 60 days of the calendar year may be claimed in the year made or previous calendar year.

6 The benefit of compound interest COMPOUND INTEREST MAY NOT SEEM LIKE A GREAT BENEFIT OVER ONE OR TWO YEARS, BUT IT ADDS UP OVER THE LONG TERM Source: Fidelity Management & Research Company. This represents a hypothetical illustration of compound growth. Compound growth calculations are used only for the purpose of illustrating the effects of compound growth and are not intended to reflect future values of any investment or return on investment. The power of compounding JohnSusan Years contributed10 Years invested2010 Total amount contributed$50,000$100,000 Total amount at the end of the period$169,198$152,455 This example assumes an 8% annual return during years invested. For illustration purposes only.

7 How much should I contribute? How much you need to save depends on Your lifestyle Goals Target age for retirement

8 How much can I contribute? The current maximum contribution to an RRSP is: The lesser of the maximum annual RRSP contribution limit $22,450for 2011 $22,970for 2012, thereafter adjusted for inflation or 18% of your previous year’s earned income, minus any Pension Adjustment If, for a given tax year, you do not make your maximum RRSP contribution, you will have unused contribution room that you can use in subsequent tax years.

9 How much can I contribute? You are allowed to over contribute up to a lifetime maximum of $2,000, without penalty. An excess contribution is calculated as the total of all of your undeducted RRSP contributions, minus your current RRSP deduction limit and minus the allowable over- contribution of $2,000. Excess contributions are subject to a 1% per month penalty until they are withdrawn. Information about your unused contribution room appears in the RRSP Deduction Limit Statement section of the Notice of Assessment that you receive every year from the Canada Revenue Agency.

10 Dollar Cost Averaging A Pre-Authorized Purchase Plan (PAC) can help make regular RRSP contributions easier and may help you benefit from market volatility through dollar cost averaging. With consistent regular contributions, you purchase more units when prices are low and less units when prices are high. This may result in a lower average price and higher capital gain.

11 What should I consider when choosing my RRSP investments? Some of the criteria to consider are: Investment time horizon Risk tolerance Performance objectives Diversification

12 What type of investment can I purchase in an RRSP? There are certain restrictions and limits on the types of investments you can put within your RRSP; however, generally segregated funds offered by life insurers and mutual funds offered by fund companies are eligible.

13 What RRSP products are available? Transamerica Life Canada offers various investment solutions to help you achieve your investment goals: Transamerica Guaranteed Investment Funds Segregated fund contract Five for Life™ Guaranteed Lifetime Withdrawal Benefit segregated fund contract Transamerica Guaranteed Interest Account Guaranteed Interest Account Speak to your advisor about the impact of withdrawals specific to segregated fund policies and GIAs to understand the impact to your guarantees.

14 How many RRSP accounts and investments can I have? You may have as many RRSP investment vehicles and accounts as you like as long as you do not exceed your maximum contribution. However, be aware of administration fees and other opening or closing charges.

15 Should I borrow to contribute? You might consider speaking with your advisor to determine whether borrowing to either maximize your RRSP contribution or to play “catch up” on any unused contribution room is suitable for you. Transamerica Life Canada has a relationship with financial institutions that can offer you an RRSP loan.

16 Individual RRSP Associated with a single individual who is also the contributor What type of RRSP accounts are available? Spousal RRSP An RRSP in which the plan holder's spouse makes contributions on behalf of the plan holder

17 What happens when I turn 71? By the end of the year in which you turn 71, you are required by law to convert your RRSP into regular retirement income. At that stage, you may pursue one or a combination of options: Withdraw RRSP funds Purchase an annuity Roll RRSP funds into an RRIF

18 Special programs to withdraw RRSP funds Canadians can borrow tax-free up to $25,000 from their RRSP to purchase their first home. The loan must be repaid to the RRSP within 15 years after an initial 2 year grace period. Home Buyer’s Plan (HBP) Lifelong Learning Plan (LLP) Similar to HBP except the money borrowed is to go to or return to a qualified post-secondary school. Annual withdrawal limit of $10K per year to a maximum of $20K; No limit on number of times you can participate in the plan after you bring your balance to zero. Must be repaid in 10 years. Some restrictions on amounts you can withdraw – contributions you made to your RRSP during the 89-day period just before withdrawal.

19 Start early in life. Invest regularly. Pay yourself first strategy Invest regularly. Pay yourself first strategy Top up any unused contribution room. The RRSP gross-up strategy Top up any unused contribution room. The RRSP gross-up strategy Diversify your investments. Tips to help make the most of your RRSP

20 Your advisor can help Speak with your advisor about designing a customized RRSP to suit your needs, and to choose Transamerica investments that can help grow your savings over time and that are appropriate for your personal investment objectives and circumstances.

21 Notice to investment professionals This presentation is for general information purposes only. This communication is published by Transamerica Life Canada (“TLC”) with material obtained from a number of third party sources. Any commentaries and/or information contained herein are intended for general information use. While reasonable efforts have been made to ensure that the contents have been derived from sources believed to be reliable and accurate at the time of publication, AEGON does not warrant the accuracy or completeness of the information contained herein. Neither AEGON, nor its affiliates, advisors, or any other person accepts any liability whatsoever for any direct, indirect or consequential loss(es) arising from any use or reliance on the information or opinions contained herein. For complete details of each product described in this presentation, please refer to the respective Annuity Policy and Information Folder. A more detailed description of the Fund(s), including investment objectives, contractual features, investment policies and Fund assets, and investment risks may be found in their respective Summary Fact Statements. Transamerica Life Canada is the issuer and guarantor of the Transamerica Guaranteed Investment Funds contract and the Five for Life contract. Any amount that is allocated to the Five for Life or Transamerica Guaranteed Investment Funds Contract is invested at the risk of the contract holder and may increase or decrease in value. Compound growth calculations are used only for the purpose of illustrating the effects of compound growth and are not intended to reflect future values of any segregated fund or returns on investment in any segregated fund. Discuss the risks associated with borrowing to invest in segregated funds with your advisor before investing. Purchases using borrowed money are subject to suitability requirements. Using borrowed money to finance the purchase of investments involves greater risks than a purchase using cash resources only. If investors borrow money to purchase segregated funds, their responsibility to repay the loan and pay interest as required by its terms remains the same if the value of the segregated funds purchased declines. Under these circumstances, the investor should be advised to have sufficient financial resources to repay the interest and to reduce the loan if required under the loan arrangement. Loans are not offered by Transamerica Life Canada, AEGON, nor its affiliates. ® AEGON and the AEGON logo are registered trademarks of AEGON N.V. AEGON Canada Inc. and its subsidiary companies are licensed to use such marks. ® Transamerica and the pyramid design are registered trademarks of Transamerica Corporation. Transamerica Life Canada is licensed to use such marks.

JANUARY 2012 Thank You!