The document provides a summary of a presentation given by Steven Scott of Retirement Solution Group to participants in the RSG 401(k) plan. The presentation discussed that in 2012 the S&P 500 returned over 13% despite predictions of economic doom. It emphasized that saving for retirement is important as many people have less than $100,000 saved. The presentation outlined 2013 contribution limits and recommended that participants save more, have a retirement readiness plan, and realize that volatility will remain in the markets. Participants were reminded of the support services available from RSG and to make informed decisions about their retirement savings.
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Q1 2013 Participant Review
1. January 29, 2013
To the Participants of RSG
401(k) Update
Holy Cow, it is 2013…
Presentation by:
Steven Scott
Managing Partner
Retirement Solution Group, LLC
“Securities offered through Ausdal Financial Partners, Inc, 220 North Main Street,
Davenport, IA, 52801, 563.326.2064, member FINRA, SIPC. Advisory services provided by Ausdal
1Financial Partners. Retirement Solutions Group and Ausdal Financial Partners, Inc
|
are separately owned and operated companies.”
2. 401(k) 101
s Retirement
Monies
Focus is long-term
Is your social security going to be enough?
s Defer
0 – 100% of pay, but not more than annual limit of $17,500 (2013)
Traditional, Pre-Tax**
Roth, After-Tax**
Catch-Up Contribution Remains at $5500 for those 50 and older
s Investments
Do it yourself, mutual funds
Little help, Lifestyle Funds
Auto-Pilot, Lifecycle Funds
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**Please consult your tax professional**
3. The Fiscal Cliff, Mayan calendar, and numerous other
stories in 2012 spoke of our impending doom, or at least
economic doom. So where did the S&P 500 end up?
(source: Morningstar)
- 2.2 %
5.2 %
13.41 %
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4. Answer: C… Over 13%!
Think about that for a moment.
s
All we heard was that things were terrible at the end of 2012
s
We had some periods of significant volatility
s
The “New Norm”
But…
s
Still have had a lot of government “band-aid” solutions propping up returns
s
No summer sell-off
s
A lot of issues remain on the horizon, maybe not so distant…
s
But does anyone think the craziness is over???
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Retirement Solution Group
7. Why 401(k)/Retirement Plans Matter
s Update:
Fidelity reports the highest average participant account balance in
401(k)’s for the 12 years they have run the study in September 30, 2012 at
just over $79,000. This is 18% improvement from the year prior.
Source: US News & World Report
s The
Good: The Deferral rate for 401(k) Participants rose by 7.3% over the
past five years. From an average annual contribution of $5,500 versus
$5,900 in September of 2012.
Source: US News & World Report
s The
Scary: When we look at participants age 55 and older, 22% have more
than $250,000 in retirement savings and 40% had at least $100,000 in
retirement savings. But that leaves 60% below the $100,000 mark, and a
frightening 38% have less than $10,000 saved for retirement!
Source: Moolanomy
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8. New Limits for 2013
s Deferral
Limits:
$17,500 for 2013
$5,500 in catch-up contribution for participants 50 or older (Plan dependent)
Remember:
s Which
of these variables changed by 20% will have the GREATEST
IMPACT on Retirement Readiness:
1. Retiring
5 years early at age 62
2. Contributing
8 years earlier at age 34
3. Increasing
the 7.11% ROR by 20%
4. Increasing
the 6.00% Deferral by 20%
5. Increasing
the 50 cent match by 20%
6. Decreasing
the 72bp fee by 20%
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9. RRR is What Matters (Source: Fiduciary Benchmark Inc.)
•
The sensitivity analysis below shows the impact on the Retirement Readiness Ratio of 87% by
changing 6 important retirement assumptions by 20% (except for Early Retirement where the
reduction is the earliest age one can begin receiving Social Security):
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11. Markets in 2012 (Source: Morningstar as of 1/11/13)
STOCKS: 1-Year Numbers, Source – Morningstar.com (as of 1/11/13)
US Stocks 16.73 %
International Developed Countries, (EAFE) 20.54 %
International Emerging Markets, (EM) 13.11 %
BONDS: YTD
Core Bond, 4.01 %
TIPS, YTD 5.85 %
Economic Reality
Unemployment as of December 2012 = 7.8 %
•
•
Lower than 8.3% at last meeting
Same as November 2012
Q3 2012 GDP growth = 3.1 %
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12. “What we said” January 2012 RSG Participant Webinar
s US
Stocks: Large looked better than small.
s US
Bonds: TIPs looked favorable versus core bonds
s Overseas:
markets
Emerging markets looked more attractive than developed
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13. RSG Service Model for Retirement Plans
s Service
Provider: They work for us, we do not work for them. Fee
disclosure, benchmarking, industry concentration, repricing…
s Funds:
Spring fund due diligence reports due.
s Results:
On average RSG’s participants are saving at a 7.8% average
deferral percentage.
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15. Value the Benefit
s Service
Model:
Plan update meetings
Help with consolidating other retirement accounts
Individual meetings as needed
Annual review
Quarterly webinars
•
•
s Save
Next one is April 30, 2013.
Always last Tuesday of the month, following quarter end
More…
When was the last time you gave your 401(k) a raise?
s Have
a Retirement Readiness Plan
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16. Value the Benefit: Sample Asset Allocation Model
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17. Value the Benefit: the Relationship between Risk and Return
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18. Reminders
s
You can save up to $17,500 or $23,000 if 50 or older
s
You now have increased support
s
Reality Check – The $100,000 problem
s
Remember, we fire funds… Spring 2013
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19. Summary
s What
Matters?
The little decisions are not little
s What
Happened?
Goal is for participants to make “Informed Decisions,” expect more bumps in
the road…
s What
To Do?
Save more
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20. So What?
The DOL says the average American Should Save 12%
Note: 3.7% Savings Rate (Source: Bureau of Economic Development)
Next Steps:
s
2013 limits are $17,500 ($23,000 with catch-up provision for those over 50)
s
What do you own?
s
Volatility will remain
s
Does it fit?
Next Steps:
s
Analyze Situation
s
Select a Path
s
Create a Retirement Plan Calendar
“Investments involve risks and potential loss of principal and are not FDIC insured investments.
Investments and investments in 401k plans are not guaranteed by the federal government or
the FDIC, they involve risk including but not limited to loss of principal. Opinions expressed are
those of Steve Scott and do not represent the opinions of Ausdal Financial Partners, or
Retirement Solution Group, LLC. They are opinion only and should be not considered as stand
alone advice.”
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21. RSG Participant Support Team
RSG is always available, 866-352-7731
1.
Steve Scott, Managing Partner x 210
2.
Elvia Sanchez, Education & Relationship Manager (Bi-Lingual) x410
3.
Christie Cheng, Education & Relationship Manager x310
4.
Megan Dunne, Associate x200
5.
Mary Urlich, Participant Transactions x1
“Can you help me with my forms?”
“I have no idea on these funds, can you help me with that?”
“How much should I be saving?”
“Not really sure if I am aggressive investor or not, how do I figure that out?”
“What is a stock/bond?”
“Why do people keep talking about Spanish Bonds Yields?”
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Editor's Notes
NOTE ABOUT SPEAKER NOTES:
Content in the speaker notes section are not meant to be used as scripts and SHOULD NOT be distributed to clients. Instead, they’re supposed to provide general concepts expressed by the material, explanations of specific services and capabilities, and suggestions for expressing these ideas effectively.
You may replace content in these speaker’s notes with your own language that reflects the concepts being expressed.
The purpose of this section is to demonstrate our client-focused approach by showing that we’ve done our homework to identify what we know about their financial challenges and objectives and what we can do to address them.
The purpose of this section is to demonstrate our client-focused approach by showing that we’ve done our homework to identify what we know about their financial challenges and objectives and what we can do to address them.
The purpose of this section is to demonstrate our client-focused approach by showing that we’ve done our homework to identify what we know about their financial challenges and objectives and what we can do to address them.