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14 • The Columbia Valley Pioneer November 30, 2012 YOUR MONEY Pooled Retirement Pension Plans? It is widely recognized that the ideal retirement savings plans in Canada are those which incorporate three components: government programs like the Canada Pension Plan, personal savings and workplace savings programs. According to an Environics study conducted in 2010, only four out of every 10 Canadians have a workplace savings plan. These statistics, coupled with record low savings rates among Canadians, have prompted the federal government to pass Bill C-25, the Pooled Registered Pension Plans Act. The object is to help replace some of the pension deficiency in this country by providing a simplified, cost-effective pension alternative to owners of small to mid-size companies, which do not currently have a pension plan in place for their employees. The current pension landscape The most desirable type of pension plan in Canada is the defined benefit pension plan, which promises a specific dollar amount payable monthly to a plan member upon retirement at a certain age, usually for the rest of their life. Other types of pension plans include defined contribution or money purchase plans, both of which do not promise specific income payments. Defined benefit pension plans in Canada have grown scarcer over time. In fact, those who enjoy these types of pensions are generally current or former employees of federal, provincial and municipal governments or select large corporations. Brendan Donahue BCOMM, CIM, FCSI Senior Investment Advisor Insurance Agent Sara Worley Investment Advisor Insurance Agent O ering the valley… Investments Stocks, Bonds, GICs, Income Trusts, Preferred Shares, ETFs, Mutual Funds and more. Accounts RRSPs, RRIFs, TFSAs, LIRAs, RESPs, Corporate Accounts, Cash Accounts Services Estate Planning, Financial Planning, Insurance Planning, Retirement Planning In recent years, many large corporations have scaled back their pension offerings to new employees. This decision is in direct response to increasing uncertainty of the present and future ability to fund defined benefit pension liabilities. According to a study published in 2010 by the Certified General Accountants Association of Canada, pension funding deficits climbed from $160 billion in 2003 to an estimated $350 billion in 2008. These deficiencies in employer-sponsored pension plans, coupled with the general lack of personal retirement savings in Canada, are the factors which prompted the proposal of Pooled Registered Pension Plans. Structure A Pooled Retirement Pension Plan would be offered by various financial institutions, such as insurance or mutual fund companies, known as administrators. Due to pooling assets into specific investment products, the fees would theoretically be lower than many traditional products. Contributions would be made by the employee, the employer, or both. Similar to a traditional pension plan, all contributions, whether made by an employee or employer, are deducted from the employee’s Registered Retirement Savings Plan (RRSP) contribution room. Advantages to employers Participation in a Pooled Retirement Pension Plan may be completely voluntary, depending on how each province Selection 19 GIC Companies, 15 Insurance Companies, 100 Mutual Fund Companies Research TD Newcrest, Credit Suisse First Boston, First Energy Capital Corp, MFC Global Investment Management ultimately decides to implement the program. Due to their proposed structure, if an employer decides to participate in a Pooled Retirement Pension Plan, the often onerous administrative duties associated with pension plans should be greatly reduced compared with traditional offerings. Bill C-25 also includes some financial sweeteners for employers. Employer contributions will not be subject to payroll taxes, and the contributions can be deducted from an employee’s income as a salary expense for tax purposes. Advantages to employees Perhaps the biggest advantage to employees will be that they will not be able to take money out of their Pooled Retirement Pension Plans until retirement. Current group RRSP plans set up by employers for their employees can be accessed at any time by the employee. Unfortunately for the future financial health of the country, this happens far too often. Outlook Pooled Retirement Pension Plans have been met with some criticism. Some opponents have indicated that a pension system that is voluntary and marketdriven is not a viable option, and that a better plan would be to expand the Canada Pension Plan. Others argue that there are enough defined benefit pensions in the country that are already underfunded and there is no need to put extra burden on the Canada Pension Plan. Investments, Insurance & Financial Planning GIC Rates* as of November 27 th . 1 year 1.90% 2 year 2.10% 3 year 2.25% 4 year 2.35% 5 year 2.50% *Rates subject to change without notice. Manulife Securities Incorporated is a Member of the Canadian Investor Protection Fund. Insurance products and services are o ered through Manulife Securities Insurance Agency (a licensed life insurance agency and a liate of Manulife Securities) by Manulife Securities Advisors licensed as life agents. The Manufacturers Life Insurance Company is the sole issuer of the Manulife GIF Select insurance contract which o ers the IncomePlus bene t and the guarantor of any guarantee provision therein. Call us for professional, free consultations! • Ph: 250-342-2112 • Fax: 250-342-2113 • 712-10 th Street, Invermere
November 30, 2012 The Columbia Valley Pioneer • 15 Kicking Horse Coffee By Greg Amos Pioneer Staff Hot Deals! December Daily Specials at the Hot Springs. Monday Parent & Tot Parent $5, Tots FREE geared to grow From humble beginnings to its current status as the top organic fair trade coffee company in Canada, Invermere’s Kicking Horse Coffee has built a brand around quality and consistent character over the last 16 years. And despite making a multi-million dollar private equity deal with a U.S. partner in August, opening doors to new markets and products, the company has no plans to bolt from the place it calls home. “We’re geared to grow,” said CEO Elana Rosenfeld in a Thursday, November 22nd interview with The Pioneer. “Nothing will change, except now we have more opportunities, and more contacts and resources to access.” Branch Brook Holdings, a new American partnership between Swander Pace Capital, Jefferson Capital Partners, and natural foods distributor United Natural Foods, made Kicking Horse Coffee its first investment in a deal that’s resulted in a five-member board being set up to oversee the company. According to the Vancouver Sun, the deal was among the largest private equity investments in B.C. this year. “I’m still the CEO and still running the company,” said Ms. Rosenfeld, who has one seat on the board. Branch Brook personnel have three seats, while one independent member with expertise in U.S. markets rounds out the board. Ms. Rosenfeld’s former partner, Leo Johnson, sold his interest in the transaction and is no longer involved with the company, which now boasts about 40 Tuesday 2 for 1 Two entries for the price of one employees but is geared up to double its workforce. “We have the production capacity, and now we’re just building the sales force for Canada and the U.S.,” said Ms. Rosenfeld, 43, who in 2011 was ranked fifth in PROFIT magazine’s ranking of Canada’s top female entrepreneurs. The magazine noted Kicking Horse Coffee has shown three-year revenue growth of 75 per cent, and Ms. Rosenfeld said she plans to veer little from the course the company has charted so far. “You have to maintain that integrity, stay quite focused and not get swayed by pressures and opportunities,” she said. “As we move forward, that’s the fun of it, to maintain our integrity and our quality.” “People spend $15.99 on a pound of our Kick Ass Coffee, and we don’t want to disappoint them — we want to make sure they’re wowed every time they open up the bag,” she added. As to the question of how one of B.C.’s most successful businesses has made it in a far-flung place like Invermere, Ms. Rosenfeld maintains that sense of place is a key ingredient in the company’s success. “In a vacuum, you are forced to be creative,” she said. “Even within the first year, we saw the energy and the reaction to it and from there, we doubled every year. There’s so much opportunity here; it’s open season. A lot of our creativity and our branding came from that vacuum; we are fed by our environment.” “Some marketing dude in New York isn’t going to come up with Bugaboo blend or Kootenay Crossing,” she added. Wednesday Toonie Day Entry only $2 after 6:00pm Continued on page 16 . . . Thursday Sip & Soak Receive a $5 Tapas & Wine Bar voucher Friday 55+ Day $5.55 Hot Spring entry + $5 Tapas & Wine Bar voucher 7th Avenue, Invermere • 250-342-6415 Saturday Pools & Pizza FREE slice of pizza at Misty Waters with every $12 entry fee Sunday Family Swim Day 2 adults and 2 kids swim all day for only $20 M T W T F S S Daily specials end December 24, 2012 and are not valid through the holidays. Tot is 5 and under. Plus taxes. Visit the new Tapas & Wine Bar located in the Lodge Lobby. Now available at The Monkey’s Uncle Guaranteed Fun! on select board games. Buy it! Try it! If it’s not fun, bring it back for a full refund! Come see our selection of games. GUARANTEED TO BE FUN! SUPER SUNDAY DECEMBER 2 ND • 11 A.M. - 4 P.M. ASK OTTO 15 - 50% OFF STORE WIDE Main Street, Invermere, B.C. • 250-342-2515 T h e Pioneer Triple the circulation, triple the advertising power of any other local newspaper! fairmonthotsprings.com
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