Sales Opportunities Within The Group Retirement Market CAIFA Ontario School 2001 Daryl Diamond CFP CLU CHFC Diamond Retirement Planning Ltd.

Disclaimer

Two Aspects Our approach to prospective employers Making it work

Two Tales 1The Generous Volunteer 2The Confident Loser

Our Objectives ! To deliver interactive programs of financial and retirement education in Canada’s workplace ! To encourage employees, through these workshops, to take an active role in their own financial affairs ! To accomplish the above through a national network of qualified advisors

How These Programs Were Written ! Information in a logical progression ! Educational and insightful ! With neutrality ! Without product or institutional bias ! Encourages exploration of alternatives ! Encourages attendees to take action

Issues To Address ! The need from the corporate perspective ! The need from the employee’s perspective ! Choosing a provider ! Funding the program

The Need From The Corporation’s Perspective What are some of the reasons you would consider implementing an educational program within your organization? What are some of the obstacles you face in providing such a program?

The Changes To Corporate Retirement Programs ! Move away from Defined Benefit (DB) pension plans to Defined Contribution (DC) plans ! Move from pension to Group RRSP combined with pension and /or DPSP ! Availability of new investment options, many of which are variable, and chosen by plan members

Employee Retirement Income Security Act (ERISA) Section 404(c) Directs the employer to provide; ! Reasonably diversified investment options ! Flexibility for employees to make changes to investments throughout the year ! Proper information on investment options and investing

ERISA Clarifications “We will encourage employers to provide pension plans and help teach workers to plan and save adequately for retirement” U.S. Labor Secretary Alexis M. Herman November 1997

Components In Your Retirement Programs Consultant Investment Manager Investment Manager Plan actuary Reports Provides quotes at, Termination Retirement Manages investments Distributes contributions Produces statements

We Provide What Is Missing ! Education and insight ! Communication ! An accessible resource ! Recommendations based on the total picture ! Positioning, structure and ongoing counsel ! The follow through to make things happen

Benefits To The Employer ! Increased productivity ! Increased understanding and participation in corporate benefit programs ! Increased employee retention, loyalty, morale - good will / appreciation ! Increased preparedness for employee retirement

Older Employees ! Highest end of the pay scale ! Employer retirement contributions are high ! Most expensive benefit premiums ! Most vacation days Providing financial education at a younger age allows for better financial decisions and puts employees in a position to retire earlier

The Need From The Employee’s Perspective ! Changing Factors

Changing Factors Male Age 65 Income FactorsYearLife Expectancy 7.5 Yrs 10 Yrs 14 Yrs Today Yrs 20 + Yrs Only a few retirement years to fund CPP commences Appreciating real estate values High nominal interest rates Excessive taxation Excessive Government borrowing None of the above apply in the same manner

The Need From The Employee’s Perspective ! Changing Factors ! Considerations For Future Retirees

Additional Considerations Issue Retirement Age Life Expectancy Lifestyle Expectations Taxation Inflation Family Complications Wealth Transfer Forecast Impact _______ earlier longer better greater present possible important more

The Need From The Employee’s Perspective ! Changing Factors ! Considerations For Future Retirees ! Realize they need it, they want it, but do not know where to go to get it ! The Reality

The Reality CIBC 1998 ! 72% do not have a financial plan even though 48% use a “financial advisor” ! 21% have not started to save for retirement ! 51% have saved less than $30,000 ! 33% have saved more than $100,000 ! 7% have saved more than $400,000 ! 62% expect to work to age 65out of necessity Source: Financial Post

The Program ! A workshop that consists of seven to nine hours ! An optional one on one consultation

The Four Levels of Adult Learning 1. Awareness of an issue 2. Understanding the issue 3. Realizing the impact 4. Recognizing the steps to take

Total Planning Includes ! Looking at the whole picture ! Understanding, and full participation in, company programs ! Implementing accumulation strategies outside of employer programs ! Tailoring plans and strategies to each situation

Many Pieces To the Puzzle ! Budgeting ! Accumulation and income strategies ! Investment strategies ! Education planning ! Tax planning ! Risk management ! Estate planning issues

What Level Of Service ? Ongoing Service Implementation Planning Education

Stages of Employee Election ! Decision to attend workshop ! Decision to complete information forms ! Decision to meet for consultation ! Decision to establish relationship ! Decision to implement recommendations Use of a “Waiver Form”

Selecting A Financial Education Provider ! Do not provide this service “in-house” ! numbers from investment manager ! Fee based provider ! Full service provider

How Should This Program Be Financed ? ! Workshop is a low-outlay, high impact benefit ! Corporation provides as a benefit ! Cost shared with employee ! Deducted against expenses of plans ! Appoint us as “Agent of Record” on your plans

An Invitation... Allow us to provide a sample workshop, to a selected group of your people, pension committee, employee liaison group, etc. If at least 70% do not find it a positive experience, we will refund the cost of enrollment

Client Sources Existing Groups - What level of service? Where do your individual clients work? Pairing with a group producer Large corporations and government agencies with no servicing mandate Open sessions

So What Are The Results ? How many come in ? Why is this efficient ?

Feedback Sheets & Questionnaires

Additional Opportunities Referrals from H.R. Consolidation Lunch and Learn Special Events Company Newsletter Pay Envelope Stuffers Company Downsizing

What Do You Need ? Educational program to offer Access to group situations Membership in CPBI, CAPP and local H.R. organizations Great work ethic Organization and admin assistance Patience

Find out more at...

Any Questions ?