What Are Some Important Keys to an Effective Retirement Plan?

Transcription

1 What Are Some Important Keys to an Effective Retirement Plan? For financial advisor use only. Not for public distribution.

2 The Power of Investment Expertise With more than 75 years of experience in the pension business, Transamerica Retirement Solutions* and its affiliates have a methodology for identifying companies with expert portfolio managers, resources, and systems. This allows plan participants the power to benefit from investment opportunities** made available by some of the leading, most highly respected names in the business, including: HARTFORDFUNDS THE GROUP With Transamerica, you have the power to take a multi-manager investment approach. * Transamerica refers to Transamerica Retirement Solutions. The investment choices are available through a contract issued by Transamerica Financial Life Insurance Company ( TFLIC ), TA-PC-2000-CONT, and certificate of participation form number TA-PC-CERT. Transamerica is an affiliate of TFLIC. This product is not available for issue in Hawaii, Nevada, Oklahoma, Washington, and South Dakota. TFLIC is not authorized and does not do business in the following jurisdictions: Guam, Puerto Rico, and the U.S. Virgin Islands. Fees and charges may apply. For complete information, contact your Transamerica representative. All Transamerica companies identified are affiliated. **The list of investment choices has been selected by an independent outside third party investment advisory firm. Trademarks are the intellectual property of their respective owners. To get the power for those you value, call Monday through Friday, from 9 a.m. to 7 p.m. ET. 2

3 The Choice of a Diverse Investment Selection Prudence demands that the plan you offer provide a wide assortment of investment opportunities to meet the diverse investment objectives, risk tolerance, and time horizons of your plan s participants. Short Bonds/Stable/MMKT Stable Value Transamerica Stable Value Core Account Intermediate/Long-Term Bonds Government Bonds DFA Inflation-Protected Securities Portfolio Ret Acct PX Intermediate-Term Bonds Prudential Total Return Bond Ret Acct PX Pioneer Bond Ret Acct PX Aggressive Bonds High-Yield Bonds Transamerica Partners High Yield Bond Ret Acct PX Large-Cap Stocks Large-Cap Value Stocks Invesco Comstock Ret Acct PX Large-Cap Blend Stocks American Century Equity Growth Ret Acct PX Transamerica Partners Stock Index Ret Acct PX Large-Cap Growth Stocks Ivy Core Equity Ret Acct PX Transamerica searches for investment opportunities that may add diversity to a retirement plan portfolio. Plan participants can choose from an investment selection to allow for balancing risk against potential return with a lineup of nearly 30 investment choices from top firms, including: Small/Mid-Cap Stocks Mid-Cap Value Stocks American Century Mid Cap Value Ret Acct PX Mid-Cap Growth Stocks Franklin Small-Mid Cap Growth Ret Acct PX Small-Cap Blend Stocks Vanguard Small-Cap Index Ret Acct PX Small-Cap Growth Stocks Hartford Small Cap Growth HLS Ret Acct PX International Stocks Emerging Market Stocks Oppenheimer Developing Markets Ret Acct PX World/Foreign Stocks Invesco International Growth Ret Acct PX MFS International Value Ret Acct PX Transamerica International Equity Ret Acct PX Multi-Asset/Other Target Date Investment Choices Vanguard Target Retirement 2010 Ret Acct PX Vanguard Target Retirement 2015 Ret Acct PX Vanguard Target Retirement 2020 Ret Acct PX Vanguard Target Retirement 2025 Ret Acct PX Vanguard Target Retirement 2030 Ret Acct PX Vanguard Target Retirement 2035 Ret Acct PX Vanguard Target Retirement 2040 Ret Acct PX Vanguard Target Retirement 2045 Ret Acct PX Vanguard Target Retirement 2050 Ret Acct PX Vanguard Target Retirement 2055 Ret Acct PX Vanguard Target Retirement Income Ret Acct PX More than 4 million individual participants have invested more than $152 billion in the wide range of investment opportunities made available on Transamerica s retirement platform (as of December 31, 2014). The separate account investment choices offered are exempt from registration with the SEC; therefore, no prospectuses are filed for them. However, certain of the separate account investment choices, other than stable value investment choice(s), invest in mutual funds which are subject to SEC registration. Investors should consider the investment objectives, risks, charges, and expenses of the fund carefully before investing. The prospectus for each fund contains this and other important information about that fund. In addition, comprehensive information on all the investment choices is available on the investment fact sheets. Prospectuses for these mutual funds can be ordered directly from the fund company. Read each prospectus carefully before investing. Please refer to the following page for investment risk descriptions. Investment categories are assigned by Transamerica Retirement Solutions based on the underlying investment choice, including, but not limited to, current holdings and investment strategy. As such, an investment choice s asset class may be changed in the future. Trading restrictions and/or redemption fees may apply to the investment choices. For more information, refer to the investment fact sheets on trsfundspx.com. 3

4 Investment Risk Disclosures SHORT BONDS/STABLE/MONEY MARKET Stable Value: Stable value investment choices seek capital preservation, but they do carry potential risks. Stable value investment choices may be comprised of or may invest in annuity or investment contracts issued by life insurance companies, banks, and other financial institutions. Stable value investment choices are subject to the risk that the insurance company or other financial institution will fail to meet its commitments, and are also subject to general bond market risks, including interest rate risk and credit risk. Stable value investment choices are offered by Transamerica Financial Life Insurance Company ( TFLIC ), 440 Mamaroneck Avenue, Harrison, NY 10528, and Transamerica Life Insurance Company ( TLIC ), 4333 Edgewood Road NE, Cedar Rapids, Iowa TFLIC is not authorized and does not do business in the following jurisdictions: Guam, Puerto Rico, and the U.S. Virgin Islands. TLIC is not authorized in New York and does not do business in New York. TFLIC and TLIC are affiliates of Transamerica Retirement Solutions Corporation. INTERM./LONG-TERM BONDS Government Bonds: The value of bonds changes in response to changes in economic conditions, interest rates, and the creditworthiness of individual issuers. Bonds can lose value as interest rates rise, and an investor can lose principal. Any U.S. government guarantees of the securities pertain only to those securities and not to portfolios that invest in them. Intermediate-Term Bonds: The value of bonds changes in response to changes in economic conditions, interest rates, and the creditworthiness of individual issuers. Bonds can lose value as interest rates rise, and an investor can lose principal. AGGRESSIVE BONDS High-Yield Bonds: These securities involve additional risks because of the lower credit quality of the securities. The investor should be aware of the possible higher level of volatility and increased risk of default. LARGE-CAP STOCKS Large-Cap Value Stocks: Stocks have historically offered the potential other investments. Value stocks may be subject to special risks that have caused the stocks to be out of favor and undervalued in the opinion of the portfolio managers who invest in them. Large-Cap Blend Stocks: Stocks have historically offered the potential other investments. Blend strategies are subject to both growth and value risks. Large-Cap Growth Stocks: Stocks have historically offered the potential for greater long-term returns, but also entail greater short-term risks than other investments. Most growth investments offer higher potential capital appreciation but usually at above-average risk. Growth stocks can perform differently than other types of stocks and the market as a whole and can be more volatile than other types of stocks. SMALL/MID-CAP STOCKS Mid-Cap Value Stocks: Stocks have historically offered the potential other investment choices. Mid-cap stocks may be more vulnerable to market downturns, and their prices could be more volatile than those of larger companies. Value stocks may be subject to special risks that have caused the stocks to be out of favor and undervalued in the opinion of the portfolio managers who invest in them. Mid-Cap Growth Stocks: Stocks have historically offered the potential other investment choices. Mid-cap stocks may be more vulnerable to market downturns, and their prices could be more volatile than those of larger companies. Most growth investments offer higher potential capital appreciation but usually at above-average risk. Growth stocks can perform differently than other types of stocks and the market as a whole and can be more volatile than other types of stocks. Small-Cap Blend Stocks: Stocks of small companies involve additional risks, including a higher risk of failure, and are not as well established as large, blue-chip companies. Historically, small-company stocks have experienced greater price volatility than the overall market. Blend strategies are subject to both growth and value risks. Small-Cap Growth Stocks: Small-company stocks involve additional risks, including a higher risk of failure, and are not as well established as large, blue-chip companies. Historically, small-company stocks have experienced greater price volatility than the overall market average. Growth stocks can perform differently than other types of stocks and the market as a whole and can be more volatile than other types of stocks. INTERNATIONAL STOCKS Emerging Market Stocks: Emerging market stocks involve special additional risks, including but not limited to, currency risk, political risk, and risk associated with varying accounting standards. Historically, emerging market stocks have experienced a greater degree of price volatility than stocks from developed markets. World/Foreign Stocks: These risks include, but are not limited to, currency risk, political risk, and risk associated with varying accounting standards. Investing in emerging, or developing, markets may accentuate these risks. MULTI-ASSET/OTHER Target Date: These options generally invest in a mix of stocks, bonds, cash equivalents, and potentially other asset classes, either directly or via underlying funds, and may be subject to all of the risks of these asset classes. The allocations become more conservative over time: The percentage of assets allocated to stocks will decrease while the percentage allocated to bonds will increase as the target date approaches. The higher the allocation is to stocks, the greater the risk. The principal value of the investment option is never guaranteed, including at and after the target date. 4

5 The Freedom of Professional Support Even in the largest of companies, Human Resources staff are limited. Receiving objective guidance and support from an experienced Paychex professional is key to creating a plan that benefits plan sponsors and their participants. The Paychex Retirement Plan with investments through Transamerica offers you the freedom of: Investment Performance Ratings from Morningstar, Inc. You can also choose a quality investment selection from a lineup with Overall Morningstar Ratings TM.* This leading global investment research firm examines how each investment choice balances risk against return. An overall star rating is provided, which can be a helpful first step in evaluating the investment selection. SIMPLE Solutions Enrollment Booklet Transamerica explains key investment concepts in this guide, such as asset allocation, in order to help employees see the value of enrolling in your retirement plan. Investment Fact Sheets For making more informed investment decisions, Transamerica provides in-depth investment fact sheets that include summary descriptions, historical performance, and top-ten holdings for each investment choice. Performance Overviews With Transamerica, your plan participants can quickly see whether their investment choices are on target with their retirement goals using straightforward reporting on the performance of each investment choice. The Transamerica Difference Global Power Transamerica Retirement Solutions is part of Aegon, one of the world s largest pension services companies and a provider of investment products with operations in 20 markets in the Americas, Europe, and Asia, and employing about 28,500 professionals worldwide. Aegon takes pride in balancing a local approach with the power of an expanding global operation. Local business units, like Transamerica, are empowered to identify and provide products and services that meet the evolving needs of their customers, using distribution channels best suited to their specific markets. Local Commitment With our united effort, Paychex and Transamerica can be instrumental in helping you grow your business. A local Paychex representative is readily available to answer questions or client specific inquiries you might have. For investment information, a local Transamerica representative can provide you with information. Our united effort is solely focused on giving you a retirement plan that can help your employees save and invest wisely to live the life they want. * 2015 Morningstar, Inc. All rights reserved. For each investment choice with at least a three-year history, Morningstar determines a Morningstar Rating based on a proprietary Morningstar Risk-Adjusted Return measure that accounts for variation in monthly performance, placing more emphasis on downward variations and rewarding consistent performance. Although Transamerica s investment choices are not included in Morningstar s open-end mutual fund database, Morningstar Ratings TM are derived by comparing the Morningstar Risk-Adjusted Returns for each investment choice to the funds in its respective Morningstar category within the open-end database. The top 10% of funds in each Morningstar category receive five stars, the next 22.5% receive four stars, the next 35% receive three stars, the next 22.5% receive two stars, and the bottom 10% receive one star. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) The Overall Morningstar Rating for each investment choice is derived from a weighted average of the performance figures associated with its three-, five-, and ten-year (if applicable) Morningstar Rating TM metrics. Target date options generally invest in a mix of stocks, bonds, cash equivalents, and potentially other asset classes, either directly or via underlying funds, and may be subject to all of the risks of these asset classes. The allocations become more conservative over time: The percentage of assets allocated to stocks will decrease while the percentage allocated to bonds will increase as the target date approaches. The higher the allocation is to stocks, the greater the risk. The principal value of the investment option is never guaranteed, including at and after the target date. 5

6 Call Paychex at , Monday through Friday, from 9 a.m. to 7 p.m. ET. For Transamerica s dedicated Paychex support line, please contact , Monday through Friday, from 9 a.m. to 7 p.m. ET. Transamerica Retirement Solutions Corporation is not affiliated with Paychex. For financial advisor use only. Not for public distribution FA_B_Paychex (05/15) 2015 Transameica Retirement Solutions Corporation