Savers Guide

SAVINGS AND GUARANTEED INVESTMENT FUNDS

 D E F I N E Y O U R P R I O R I T I E ST H E F I R S T S T E P T O WA R D T H E F U T U R E Y O U D E S E R V E

Desjardins Insurance refers to Desjardins Financial Security Life Assurance Company.

Desjardins Insurance refers to Desjardins Financial Security Life Assurance Company. 200 rue des Commandeurs, Lévis, QC G6V 6R2 1-866-647-5013 11268E (2020-05)

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Table of ContentsINTRODUCTION 3

QUIZ: MYTHS THAT SABOTAGE YOUR SAVINGS 4

STEP 1: GET TO KNOW THE ISSUES 5 ▶ Market downturns and volatility 5 ▶ Living a long life 5 ▶ Costly unexpected events 5 ▶ Inflation 6 ▶ Taxes 6 ▶ Delays and conflicts related to your death 6 ▶ Planning for two 6 ▶ Having your investments seized 6

ANSWERS TO THE QUIZ 7

STEP 2: ESTABLISH YOUR PRIORITIES 9

NOTES 10

STEP 3: PREPARE FOR YOUR MEETING WITH A REPRESENTATIVE 11

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Protect yourself against market turmoil. Look after your loved ones. Live the life you want.

How do you imagine your future?We’ve developed this guide to help you determine what your key retirement savings concerns are, so you won’t be bothered with unnecessary worries and unpleasant surprises, such as :

• having to delay or cancel your dream plans;• leaving your loved ones with financial worries;• being short of money when you need it the most,

for example, when you get older or if you get sick;• having to live more frugally than you expected.

Use this guide to prepare for your meeting with your representative. They’ll know which savings solutions will be best suited for your key concerns.

Secure your plans for the futureGet the guarantees you need to fulfill your dreams. Contact your representative today!

I N T R O D U C T I O N

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Q U I Z

Myths that sabotage your savingsCertain beliefs can get in the way of effective financial planning. Are the following statements true or false? Test your knowledge!

BELIEF TRUE FALSE

1. The law will ensure my assets are divided fairly after my death.

2. My loved ones won’t have any financial worries thanks to the inheritance I’m leaving in my will.

3. The government pension plan benefits will be enough to cover my basic needs, i.e., food, shelter, clothing.

4. Because I’m self-employed, I won’t have access to any guaranteed retirement income other than government benefits.

5. Savings products with guarantees will make it hard for me to access my money.

6. Investing in the financial markets, for example mutual funds, bonds or stocks, is the only way to grow my savings and counter the effects of inflation.

7. I won’t need as much money once I’m retired.

8. If I go bankrupt, I’ll lose all of my investments.

The answers can be found on page 7.

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Market downturns and volatilityWhen retirement is only a few years away, there isn’t enough time to make up for losses caused by market downturns. Once you’re retired, a drop in the markets will have an even greater impact on your portfolio. If you withdraw your savings when the markets are down, they’ll disappear much faster than when the markets are doing well.

It’s important to take the time to review your savings plan several years ahead of your retirement. Your representative will advise you about ways to protect yourself and your assets and about investments designed specifically for the concerns you face at this stage of your life.

Living a long lifeGiven today’s higher life expectancies, you’ll probably enjoy a much longer retirement than you expected. For example, a 60-year-old woman today can expect to live another 28 years, on average.1 So, planning to make your income last longer is not being overly cautious, since this figure is only an average.

As a general rule, the pension income you’ll receive from government plans will not be enough to meet your basic needs. It’s therefore essential that you include a source of guaranteed lifetime income in your retirement plan.

Evaluate your life expectancy desjardinslifeinsurance.com/en/life-expectancy

1 Canadian Institute of Actuaries, 2014.

S T E P 1

Get to know the issues

Costly unexpected eventsUrgent repairs, health problems or other emergencies could force you to go into debt if you haven’t been putting a portion of your savings aside for those rainy days.

The majority of Desjardins Insurance savings products can be partially or completely surrendered2 if something unexpected pops up. If you find that reassuring, the best thing to do is to tell your representative you would like to put a portion of your savings into an emergency fund so they can suggest the best option for you.

2 With the exception of the Non-Redeemable Term Investment. Surrender Options are available for other Savings Products offered by Desjardins Insurance. Please refer to the provisions of the specific Contract for more specific information. Certain fees may apply.

C O M E I N T O S O M E U N E X P E C T E D M O N E Y ?

An insurance benefit, inheritance or winning lottery ticket can also raise a whole new set of financial questions. Do you need time and advice to help you make an informed decision? Your representative has all the tools to help you out: attractive short-term investments, tips for reducing your tax bill, guaranteed income solutions, etc.

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InflationInflation reflects the rising cost of the goods and services you consume. However, when you’re retired, inflation will constantly be eroding your purchasing power, and year after year, it will gradually reduce the real value of the assets you want to leave behind.

Certain Desjardins Insurance products, including the Helios2 Contract and life annuities, offer inflation protection.

$50,000 in savings today will have a purchasing power of only $26,970 in 25 years.*

* With an annual inflation of 2.5%.

TaxesIt’s never too early or too late to reduce your tax bill. The savings products offered by insurance companies include unique tax advantages.

Delays and conflicts related to your deathSettling an estate is a process that’s often fraught with delays, various fees (legal, accounting, etc.), and sometimes tension. If you want to ensure your loved ones want for nothing after you’re gone, you need to accumulate funds outside your estate.

There are several advantages to saving outside your estate:3 the Death Benefit from your Desjardins Insurance Contract will be paid in a few business days.4 Plus, the payment will be strictly confidential, an important advantage if a particular bequest is likely to cause a stir among your loved ones.5

3 In compliance with existing legislation, the Death Benefit will be paid in accordance with the Contract Owner’s Beneficiary designation. However, as the circumstances surrounding a Beneficiary designation can vary considerably or be overridden by the will of the Contract Owner, interested parties should consult a legal representative (lawyer or notary) for an assessment of their specific situation.

4 Conditions apply, including receipt of the appropriate documentation, such as a death certificate.

5 If the Beneficiary is a charitable organization, they may issue a tax receipt for the deceased person’s income tax returns. Please consult your tax representative and the charitable organization.

Planning for twoDo you want your savings to continue to look after your spouse’s well-being after you’re gone? Talk to your representative. They’ll be able to recommend solutions that will make it easier to transfer your assets6 or ensure your spouse can continue to receive your guaranteed income payments.

Having your investments seizedIf you own a business, are self-employed, or are a professional, you should ensure your savings are placed in a vehicle that may be exempt from seizure, such as a savings Contract with a proper Beneficiary designation.7 Talk to your representative.

6 In accordance with the laws governing the payment of the Death Benefit to the Beneficiary.

7 Exemption from seizure rules can be complex. Interested parties should consult a legal representative (lawyer or notary) for an assessment of their specific situation.

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Q U I Z – A N S W E R S

Myths that sabotage your savings

1. The law will ensure myassets are divided fairlyafter my death.False. If you died suddenly and didn’t have a will, your estate would essentially be divided up according to the law, but quite possibly not the way you would have intended. For example, your common-law spouse could be excluded, even if you have been together for many years.

If you have a savings Contract issued by Desjardins Insurance, the Death Benefit will be paid in accordance with your Beneficiary designation.

2. My loved ones won’thave any financial worriesthanks to the inheritanceI’m leaving in my will.False. If your assets are invested in the financial markets, they are not protected from inflation or market downturns. They could experience a significant drop in value between now and when you die, unless your savings contract provides the appropriate protection.

Besides, it can take up to twelve months to settle an estate.8 If you don’t have any savings outside your estate, your loved ones might not have enough cash readily available to meet their pressing financial obligations.

3. The governmentpension plan benefitswill be enough to covermy basic needs.False. It’s not uncommon for government pension plan benefits to be below or equal to the low income cut-off.9 You’ll need to dip into your personal savings to make up the difference.

4. Because I’m self-employed, I won’t haveaccess to any guaranteedretirement income otherthan the governmentbenefits.False. If you have personal savings, you can buy a life annuity. This product can be good replacement for an employer defined benefit pension plan, because it offers a guaranteed and predictable income for life.

8 According to an Ipsos Reid survey conducted in 2007.9 A low income cut-off is an income threshold below which

Statistics Canada estimates a family or a person living alone spends 20% more than the average on food, shelter and clothing. In 2010, for a person living alone, this threshold varied from $12,271 to $18,759, depending on the size of the community in which they lived.

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5. Savings products with guarantees will make it hard for me to access my money.False. Desjardins Insurance savings products, including annuities, not only offer reliable guarantees, but they can also be partially or totally surrendered.10

L I F E A N N U I T Y O R I N H E R I TA N C E? T I M E T O L A Y T H I S O L D M Y T H T O R E S T !

You may occasionally hear that when you buy a life annuity, you’re giving the financial institution money that should be going to your loved ones after you die, especially if you happen to pass away during the first few years of the annuity. This is not true!

The life annuity offered by Desjardins Insurance has three options that will protect your loved ones in the event of death: the guarantee period option, the reversibility option and the cash refund option. Ask your representative!

6. Investing in the financial markets is the only way to grow my savings and counter the effects of inflation.False. Guaranteed Investment Funds, like the ones offered by the Helios2 Contract, term investments and market-linked term investments all have growth potential. In addition, Helios2 - 75/100 i, Helios2 - 100/100 i and the life annuity offer features that counter the effects of inflation.

10 With the exception of the Non-Redeemable Term Investment. Surrender Options are available for other Savings Products offered by Desjardins Insurance. Please refer to the provisions of the specific Contract for more information. Certain fees may apply.

7. My financial needs won’t be as high once I’m retired.False. Even though some of your expenses may go down, there are other costs that come with aging. Someday, you may have to pay someone to do all the small jobs around your house or for medical equipment, or for long-term care.

Even if you don’t have any health issues, you need to think about the kind of lifestyle that will make you happy: do you like to spoil your loved ones, travel, indulge in cultural and recreational activities? All that takes planning.

8. If I go bankrupt, I’ll lose all of my investments.False. Savings Contracts issued by Desjardins Insurance, allow a Beneficiary designation that can make them exempt from seizure.11 Ask for more information!

11 Exemption from seizure rules can be complex. Interested parties should consult a legal representative (lawyer or notary) for an assessment of their specific situation.

« ALTHOUGH A LOT OF FINANCIAL PLANNERS WILL TELL YOU THAT OLDER PEOPLE SPEND LESS BECAUSE THEY NEED LESS, SOME SAY THAT’S A MYTH. OLD PEOPLE SPEND LESS BECAUSE THEY HAVE LESS. »

Lee Eiseinberg, author of the bestseller The Number.

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S T E P 2

Establish your prioritiesYour name: Date:

YOUR GOALS NOT VERY IMPORTANT VERY IMPORTANT

NA 1 2 3 4

Saving for my retirement.

Number of years before my retirement:

Managing my retirement income efficiently.

Leaving money to:

my loved ones;

a charitable organization.

Saving for unexpected events.

Types of events:

Saving for various projects:

Project:

Project:

Project:

Saving more or reducing my debt.

Making informed decisions regarding a significant influx of money.

YOUR CONCERNS NOT VERY IMPORTANT VERY IMPORTANT

NA 1 2 3 4

Protecting my savings against market downturns.

Making sure I don’t outlive my money.

Having access to my money.

Protecting my savings from the effects of inflation.

Reducing my tax bill.

Being able to cover future health care expenses.

Minimizing the delay and costs related to settling my estate.Ensuring my spouse will have enough money after I’m gone.Protecting my savings in the event of bankruptcy or a legal proceeding.

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N O T E S

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Why work with a representative?A representative’s analysis of your situation is essential to ensure that you’ve taken the appropriate steps to maintain your lifestyle, that your loved ones won’t have any financial worries, and that your assets are protected in the event of your death.

Before the meetingHave you read through this document and completed the priorities assessment on page 9? Then you’re ready to discuss your goals and concerns with your representative!

Don’t forget to bring all the documents and information related to your situation:

Group insurance statement(s)

Pension plan statement(s)

Insurance policies

Legal documents (will, power of attorney, mandate, etc.)

Investment statements

Debt-related documents

Your most recent tax returns

Find a representativeGo to desjardinslifeinsurance.com and click on “Meet a representative”, or call us toll free at 1-877-938-8932.

Y O U R R E P R E S E N T A T I V E

S T E P 3

Prepare for your meeting with a representative

This document is printed on Rolland Enviro paper.

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Desjardins: A name you can count on!Desjardins Group is the leading cooperative financial group in Canada and one of the country’s best capitalized financial institutions. Desjardins Group enjoys credit ratings comparable to those of several major Canadian and international banks and is recognized as one of the most stable financial institutions in the world.

desjardinslifeinsurance.com

For the definitions of the capitalized terms, please refer to the glossary in the Helios2 - Contract and Information Folder and in the Term Investment Contract.

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Desjardins Insurance refers to Desjardins Financial Security Life Assurance Company. 200 rue des Commandeurs, Lévis, QC G6V 6R2 1-866-647-5013