Tag Archives: Registered Retirement Savings Plan

May 25: Best from the blogosphere

By Sheryl Smolkin

Due to the holiday Monday (yeah!) and other days away from my desk for random reasons, this issue of Best from the Blogosphere is being written super early. So, on no particular theme we present some great content from the last several weeks.

The Apple watch has received a bad tap from many reviewers, but Retired Syd reports on Retirement: A Full-Time Job that the device works for her. She likes being able to do all sorts of things without digging in her purse for her iPhone like paying for coffee; listening to music; getting directions from Siri; dictating error-free texts; and just lifting her arm to display her boarding pass.

In a guest post on the Financial Independence Hub, Michael Drak writes about one thing he wishes his father had taught him. While he learned about the need for working hard, saving and eliminating debt as quickly as possible, his Dad didn’t teach him about the important concept of Findependence (financial independence) and how it could positively impact his life once it was achieved.

Freedom Thirty-Five is authored by a nameless late-twenties male living in Metro Vancouver. He recently wrote about succumbing to lifestyle inflation. It seems he’s ahead of schedule by one year to reach financial freedom by his 35th birthday. So he has decided to succumb to lifestyle inflation and increase his food expenses from $100 to $150/month; eating out from $25 to $50/month and phone and entertainment from $75 to $100/month. Could you get by on these modest amounts?

Boomer & Echo blogger Marie Engen says unless there is room for occasionally splurging in your budget, becoming too frugal can ultimately undermine your budgeting efforts. Don’t banish nice things from your life. Occasional guilt-free splurges can help you stay on budget if they don’t detract from your other goals. When you don’t feel deprived you will likely find it a lot easier to stick to the plan.

And finally, on Brighter Life, I wrote a piece about Five smart ways to use your tax refund. You can start an emergency fund; top up your RRSP; pay down credit card debt; pay down your mortgage; or, open a Registered Educational Savings Plan for your child.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

Apr 27: Best from the blogosphere

By Sheryl Smolkin

If you haven’t filed your income tax return yet it’s really getting down to the wire. Whether you take advantage of them this year or next, here are some tax tips that could put more money in your pocket,

Are you entitled to a tax refund for your medical expenses? by Brenda Spiering on Brighter Life draws on her experience following her son’s accident when she learned that the part of his dental bills not covered by her health insurance at work could be claimed as a tax credit along with a portion of her health insurance premiums.

Tax accountant Evelyn Jacks addresses The Mad Dash to April 30th in Your Money. Your Life. She says once you have filed your taxes, the most important question is how you will spend your tax return. Some options are: pay down debt; save in a TFSA; use RRSP room; invest in an RESP; or invest in a Registered Disability Savings Plan.

Hey last-minute tax filers: Don’t make these common, costly mistakes says Stephen Karmazyn in the Financial Post. For example, only eight percent of taxpayers are planning to claim the Canada Employment Amount (which is a credit for work-related expenses such as home computers, uniforms, supplies) even though anyone with a T4 income can make a claim.

In a timeless blog on Retire Happy, Jim Yih offers RRSP and Tax Planning Tips. He recommends that only one spouse claim charitable deductions. That’s because the credit for charitable donations is a two-tiered federal credit of 16% on the first $200 and 29% on the balance (plus provincial credits). Spouses are allowed to claim the other’s donations and to carry forward donations for up to five years. By carrying forward donations and then having them all claimed by one spouse, the first $200 threshold with the lower credit is only applied once.

And in a Global news video Smart Cookies: Last Minute Tax Tips, Kate Dunsworth shares last minute reminders for people who have been procrastinating with their taxes. She says if you are expecting a refund and you are not planning to file on time because you don’t owe anything, you are basically giving the government a tax free loan. And if you owe money, you will be penalized for every single day you file late. Also, repeat late offenders will be penalized up to double.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

 

Canada needs more CPP says lawyer Ari Kaplan

By Sheryl Smolkin

Click here to listen
Click here to listen

As part of the ongoing series of podcast interviews on savewithspp.com, today I’m talking to lawyer Ari Kaplan, a partner in the Pension and Benefits Group of the Toronto law firm Koskie, Minsky, L.L.P.

Ari is the author of Canada’s leading textbook on pension law, and he has acted as counsel in some of Canada’s most widely known pension cases before the Supreme Court of Canada. In addition, he teaches pension law as an adjunct professor of law at both the University of Toronto and Osgoode Hall Law School.

In his spare time, Ari heads up licensing and publishing at Paper Bag Records, a leading, independent record label and artist management company also based in Toronto.

Today, we are going to talk about the Canada Pension Plan. In the ongoing national debate regarding how Canadians can be encouraged to save more for retirement, Ari is a staunch advocate for an expansion to the Canadian Pension Plan.

Welcome, Ari, and thanks for talking to me today.

My pleasure, Sheryl. Thanks for having me.

Q: How many Canadians currently have workplace pension plans?
A: Well, that’s a good question to put everything in perspective. Over 60% of working Canadians actually have no workplace pension plan, and they must rely solely on CPP and their own personal savings for their retirement income. 

Q: Why do you think that an enhanced Canada Pension Plan is the best way to give Canadians a more robust retirement income?
A: Very simple. It’s currently the only universal and mandatory savings scheme in the country. It’s portable from job to job. If you’re a student, you can work for the summer in British Columbia and then come back to a full-time job in Ontario, and your CPP credits will go with you. Also, it doesn’t just cover employees. It applies to self-employment, which most workplace pension plans don’t.

Q: As early as 2008, industry guru Keith Ambachtsheer wrote a C.D. Howe Institute commentary about the benefits of enhancing the Canada Pension Plan. Yet, in December 2013, the conservative government in several Canadian provinces voted against this proposal. Why do you think this occurred?
A: Every respected economist in the country supports a CPP expansion. The reason why the current government did not support it is political, not principled.

There was political pressure from business lobby groups who did not want to be forced to contribute employer revenue toward their employees’ retirement. There was political pressure from the financial services lobby, because they do not benefit at all when the retirement savings of Canadians is held in the CPP Trust Fund.

And finally, there’s fear among Canadian voters, who’ve been led to believe that anything opposed by business must be bad for them, too. Some of them also don’t want to be forced to save for retirement.

Q: Instead of expanding the CPP, the late finance minister, Jim Flaherty and the provinces endorsed pooled registered pension plan legislation as the way to encourage Canadians to save more for retirement. What are the key features of PRPPs?
A: Good question. PRPPs are basically like voluntary employer-sponsored group RRSPs. The funds are locked in, so it resembles a registered defined contribution plan. Your funds can also be ported to another plan and there are survivor benefits. So, it’s basically like an “RRSP-plus.”

Q: Why do you think that PRPP’s are not the answer?
A: Well, I think PRPPs are just a prime example of what I said earlier ­­­– political lobbying by business and the financial industry.

  1. The employer is not required to contribute a dime even if the company voluntarily sponsors a PRPP.
  2. An employee can opt out, or voluntarily set their contribution rate to zero, which gives zero benefit to the employee.
  3. There’s very little benefit security. Like I said, it’s like a DC plan, so you get to choose member-directed investment funds. If you don’t invest your money well, then you won’t get a good pension.
  4. The cost structure is really not that much different than a 500-member group RRSP. The management expense ratio (MER) will be much higher under a PRPP than under a large workplace pension plan or, for that matter, under CPP, where the efficiencies of scale are such that the costs are very, very, very low.
  5. It will create a huge windfall to insurance companies and other financial institutions who manage these funds, because there’s very few cost controls. There are lots of problems in group RRSPs with so-called “hidden fees” and there’s no indication that that will change with PRPPs.

I can go on, but I think you get the idea.

Q: Groups such as the Canadian Federation of Independent Business say that required employer contributions to an expanded CPP would amount to a significant payroll tax that could slow down economic growth. How would you respond to this statement?
A: To be quite blunt, this is a false and misleading statement. Anyone who tells you it’s a tax is not telling you the truth. This is employee money. It goes into a pension fund. It then goes back to the employee.

Q: Ontario Premier, Kathleen Wynne’s government is currently holding consultations on the design of an Ontario Retirement Pension Plan. What are some of the key features of that plan?
A: At the end of December of last year, the Ontario government introduced the first reading of the bill for the Ontario Retirement Pension Plan intended to commence at the beginning of 2017. The reason for the delay period is because there’s hope that the next federal government may agree enhance CPP, which could make the ORPP redundant.

But the key features are that it’s a mandatory plan. It’s like an adjunct to CPP. So, it would be mandatory in all Ontario workplaces, except where the employer already has a workplace pension plan for its workforce, and it would be integrated with the CPP.

Q: Several other provinces, like PEI, may jump on the same bandwagon, so why do we still need a national CPP enhancement?
A: Well, it would better if the federal government came on board to make it nationwide. I mean if we just have it province by province, then it’ll be more of a patchwork. This could influence inter-provincial mobility. We don’t want to discourage full inter-provincial mobility by Canadians.

Q: Well – and, of course, the other issue is – just like pension legislation across the country, which is similar, but actually very different when it comes to the details – we run the risk of getting ten or 11 completely different plans.
A: And that would result in over-regulation and an increase in transaction costs although the whole point of this is to minimize and optimize the costs of running the fund — which is why CPP is good model.

CPP is viewed as one of the best universal, mandatory state-sponsored pension plans in the world. It would be a shame for us to have to rely on province-by-province, patchwork participation in such a scheme.

Also, you know, at the end of the day, this is really something that benefits all Canadians, regardless of what age or generation they are in. One way or the other, taxpayers will be taking care of older Canadians who are poor. It’s better that Canadians have their own resources to take care of themselves; and that’s an optimal use of taxpayer resources.

So, I just really think it’s a good idea, and I really think that this is the ballot question for the upcoming federal election this year. We saw this 50 years ago when CPP was introduced. I believe this year there will be a renaissance of that issue.

Q: Thanks, Ari. It was great to talk to you.
A: My pleasure, Sheryl. Be well.

—–
This is an edited version of the podcast posted above which was recorded on February 3, 2014.

Mar 16: Best from the blogosphere

 

By Sheryl Smolkin

After two weeks away in the sun at a resort with flakey WIFI, I have lots of catching up to do! However, I managed to download the replica edition of several newspapers every day, so I wasn’t completely out of touch.

I was particularly interested in a series of editorials in the Globe and Mail articulating the newspaper’s vision as to how the retirement savings system should be reformed. The editorial team views higher TFSA contributions as an unwarranted future drain on the economy and advocates increasing RRSP contribution limits instead.

They also support ramping up CPP and eliminating RRIF withdrawal rules. You can read the whole series by clicking on the links below.

Reforming Retirement (1): How the TFSA turned into Godzilla
Reforming Retirement (2): Getting Ottawa’s mitts off your RRIF
Reforming Retirement (3): More RRSP, not more TFSA, please
Reforming Retirement (4): Canada needs to ramp up CPP, ASAP

Cait Flanders who writes Blonde on a Budget is in the 8th month of a year-long shopping ban. She says she has never been happier and shares 3 truths she discovered about her minimalist lifestyle plus information about her next minimalist challenge for 2015.

On Money We Have, Barry Choi writes about 10 Signs You’re Living Beyond Your Means. Several of my favourites are: when you have zero savings; low monthly payments are your only option; and, you buy only name brands.

Banking on Your Mobile Phone by Tom Drake on Balance Junkie reminds us that there are smart phone apps for business finance, budgeting, bank accounts and mobile payments. Paypal and Google Wallet are probably the most popular mobile payment apps. Most banks also allow to you pay by mobile with their own apps as well.

And finally, on Canadian Dream: Free at 45 Tim Stobbs writes about how a job in customer service that he was overqualified for in 2002 was a valuable experience because he had great co-workers, the company promoted from within and it had a defined benefit pension plan.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

What is a prescribed RRIF?

By Sheryl Smolkin

If you are a member of the Saskatchewan Pension Plan you can elect to retire any time between the age of 55 and 71. You can purchase an annuity from the plan which will pay you an income for the rest of your life.

You can also transfer your SPP account into a locked-in retirement account (LIRA) or a prescribed registered retirement investment account (prescribed RRIF). Both options are subject to a transfer fee.

LIRA

The LIRA is a locked-in RRSP. It acts as a holding account so there is no immediate income paid from the account. You direct the investments and funds in this option and funds remain tax sheltered until converted to a life annuity or transferred to a prescribed RRIF. You choose where the funds are invested.

The LIRA is only available until the end of the year in which you turn 71. One advantage of a LIRA is that it allows you to defer purchase of an annuity with all or part of your account balance until rates are more favourable.

Prescribed RRIF

You must be eligible to commence your pension (55 for SPP) to transfer locked-in pension money to a prescribed RRIF. If you are transferring money directly from a pension plan, the earliest age at which your pension can commence is established by the rules of the plan.

You may transfer money from a LIRA at the earlier of age 55 (SPP) or the early retirement age established by the plan where the money originated. Funds in your SPP account or your LIRA at age 71 that have not been used to purchase an annuity must be transferred into a prescribed RRIF.

Unlike an annuity, a prescribed RRIF does not pay you a regular amount every month. However, the Canada Revenue Agency requires you to start withdrawing a minimum amount, beginning in the year after the plan is set up.

The Income Tax Act permits you to use your age or the age of your spouse in determining the minimum withdrawal. This is a one-time decision made with the prescribed RRIF is established. Using the age of the younger person will reduce the minimum required withdrawal.

To determine the minimum annual withdrawal required, multiply the value of your prescribed RRIF as at January 1 by the rate that corresponds to your age:

Table 1: Prescribed RRIF + RRIF minimum Withdrawals

Age at January 1 Rate (%) Age at January 1 Rate (%)
50 2.50 73 7.59
51 2.56 74 7.71
52 2.63 75 7.85
53 2.70 76 7.99
54 2.78 77 8.15
55 2.86 78 8.33
56 2.94 79 8.53
57 3.03 80 8.75
58 3.13 81 8.99
59 3.23 82 9.27
60 3.33 83 9.58
61 3.45 84 9.93
62 3.57 85 10.33
63 3.70 86 10.79
64 3.85 87 11.33
65 4.00 88 11.96
66 4.17 89 12.71
67 4.35 90 13.62
68 4.55 91 14.73
69 4.76 92 16.12
70 5.00 93 17.92
71 7.38 94 and beyond 20.00
72 7.48
For revised RRIF withdrawal schedule based on 2015 Federal Budget, see Minimum Withdrawal Factors for Registered Retirement Income Funds.

There is no maximum annual withdrawal and you can withdraw all the funds in one lump sum. This is in contrast to other pension benefits jurisdictions such as Ontario and British Columbia where locked-in funds not used to purchase an annuity must be transferred to a Life Income Fund at age 71 that has both minimum (federal) and maximum (provincial) withdrawal rules.

The same LIRA and prescribed RRIF transfer options apply to Saskatchewan residents who are members of any other registered pension plan (DC or defined benefit) where funds are locked in.

RRSP/RRIF transfers

If you have saved in a personal or group registered retirement savings plan (RRSP) your account balance can be transferred into a RRIF (as opposed to a prescribed RRIF) at any time and must be transferred into a RRIF no later than the end of the year you turn 71 if you do not take the balance in cash or purchase an annuity.

The minimum withdrawal rules are the same as those of a prescribed RRIF (see Table 1). However, even in provinces like Ontario and British Columbia where provincial pension standards legislation establishes a maximum amount that can be withdrawn from RRIF-like transfer vehicles for locked in pension funds (LIFs), there is no cap on the annual amount that can be taken out of a RRIF.

Also read: RRIF Rules Need Updating: C.D. Howe

Feb 26: Best from the blogosphere

By Sheryl Smolkin

Well, one more week and RRSP season will be over for another year. But that doesn’t mean you should forget about contributing to your retirement savings plans including SPP for another 12 months.

In the three+ years savewithspp.com has been up and running, we have posted many blogs about the importance of paying yourself first and the mechanics of retirement saving in Saskatchewan Pension Plan, RRSPs or TFSAs.

Here are some of my favourites you can take a look at again to refresh your memory.

Pay yourself first
Save early, save often
FAQ: Employer-sponsored Sask Pension Plan
Can my spouse join SPP?
Why transfer RRSP funds to SPP?
What if I move away from Saskatchewan?
How do I know my SPP money is in good hands?
Pension Plan vs. RRSP?
SPP or TFSA?
Retirement savings alphabet soup
Understanding SPP annuities
Book Review: RRSPS THE ULTIMATE WEALTH BUILDER
How much can I contribute to my RRSP?
How to save for retirement, Parts 1, 2 and 3

You may also want to review some of these posts written by some of our favourite bloggers:

Retire Happy: RRSP Quick Facts 2015
Boomer & Echo: A Sensible RRSP vs TFSA Comparison
Canadian Personal Finance Blog: Pensions and Spousal RRSPs
Brighter Life: Six things you may not know you can do with your RRSP
Forward Thinking: Bruce Sellery on how to get excited about your RRSPs

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

Feb 16: Best from the blogosphere

By Sheryl Smolkin

The days are getting a little longer, Valentine’s Day was this past Saturday and in Alberta, Ontario and Saskatchewan it’s a long weekend. So there is lots to be happy about in spite of the never-ending winter.

But politicians who commit serious crimes won’t be happy because the Bill to revoke politicians’ pensions passed in the House of Commons would apply to future occasions when an MP or senator is convicted of crimes such as bribery or fraud. But politicians convicted of murder or distributing child pornography would not be affected. What am I missing here?

J. Money from Budgets are Sexy lists some of the guilty pleasures that he spends money on and those he items he rarely wastes money on like vending machine snacks, Uni-Ball EYE Rollerball Pens and yard sale splurges. A “no-spend month” and having kids helped him realize what’s really important in life.

Mr. Frugal Toque on Mortgage Freedom is a guest blog on Mr. Money Moustache. A year after the author paid off his mortgage he is happy he has stuck to his plan.  RRSPs topped up. Check. TFSAs maxed out. Check. And the family’s overall consumer spending has not increased.

On Personal Dividends, Miranda Marquit asks the age-old question Can Money Buy Happiness? She acknowledges y that you don’t need to live an extravagant lifestyle to be happy. However, she says that doesn’t mean that money has nothing to do with happiness. Financial security can have a lot to do with how great you feel.

And finally, if you are apprehensive about retirement or you had to take early retirement sooner than you expected, a year from now you may be happier than you could ever imagine. Why? Retirement could be your gateway to a new job says Susan Yellin on Brighter Life.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

SPP Flourishing, says General Manager Katherine Strutt

By Sheryl Smolkin

 

Click here to listen
Click here to listen

Hi, today I’m very pleased to be talking to Katherine Strutt, General Manager of the Saskatchewan Pension Plan. Since I first spoke to Katherine for savewithspp.com in December 2010, she has been featured numerous times in print, on radio, and on TV.

But when I realized it’s been four years since I formally interviewed her, I decided it was time to ask Katherine to bring savewithspp.com readers up to date on some more recent SPP developments.

Welcome, Katherine.

Thanks a lot, Sheryl.

 Q: Katherine, how many people are SPP members, and how much money is in the plan?
A: Well, we’ve had a real growth spurt over the last few years. We now have just over 23,000 contributing members and approximately 10,000 retirees. So our total plan membership is 33,332. And these members collectively have $403.8 million in assets. So we’ve had a real growth spurt.

Q: I see from your 2013 annual report that 1,415 new people joined SPP and 801 people transferred funds from existing retirement savings to their SPP account. I was one of them. Has the plan continued to grow at the same rate in 2014?
A: We want to reach a target of 1,500 new members in 2014. As of mid-December we had 1,228 people joining so far this year so we may not quite get to the 1,500 mark, but we’re going to be very close. And in terms of people transferring money in, 981 members have transferred in, so we’re past the limit that we had last year and still growing. We anticipate that that will continue to the end of the year.

Members had until December 31 to transfer money in for 2014 because it’s on a calendar year basis. But in terms of contributions, they can make their 2014 tax year contributions up until March 2, 2015. 

Q: Now I know there have been more middle-aged or older plan members. Are you starting to see the younger people waking up and realizing that they should start saving earlier?
A: Well, the average age last year was around 42 years old, and now it’s down to 40. So that two year drop may not seem like it’s a lot, but it is because that means that we are getting the younger members in.

It’s always a struggle to attract younger members because I don’t think eighteen-year-olds ever think they’re going to be sixty-five and they have other financial priorities. But I believe we’ve made some inroads by advocating they “start small and start now.” You know, you don’t have to wait until you’ve got a lot of money to invest. A little bit consistently saved is the answer.

Q: Because the annual maximum SPP contribution is $2,500, most people have additional RRSP contribution room. Why should they belong to both the SPP and a personal RRSP instead of concentrating all their savings in their own or their company RRSP?
A: That’s a really great question, Sheryl, and we get members who ask that as well. We tell them that the SPP gives members access to top money managers they may not be able to access on their own. SPP also gives members a strong investment product at a very low price. The costs of running our plan are around one percent or less, and this compares to fees in a retail mutual fund that can be anywhere between two and three percent.

So many members tell us that they wish they could put more money into their account because they see value in the product. However, if they have more than the $2,500 contribution room, a lot of them typically contribute both to SPP and to a personal RRSP in order to get the maximum value from their SPP investment.

Q: Employers can offer SPP as a retirement savings option to their employees. Tell me how that works.
A: Employers can set up an SPP pension plan and allow their employees to contribute via payroll deductions. We work with both the employer and the employees to establish the plan at the workplace, and then we handle all the paperwork and communication. SPP makes it so simple for both the employer and the employee to be part of it because we have a dedicated team at our office to help employers. Gail Genest, our Manager of Business Development, works with many companies to help set up SPP in workplaces. So anyone, employer or employee, who would like a presentation about SPP should contact our office.

Q: How many Saskatchewan companies are taking advantage of this easy way to help their employees save for retirement?
A: We saw about a 7% growth in 2014, so I think that’s a testament to Gail getting out there and talking to businesses and creating some awareness. We currently have 303 employers with just over 1,500 employees who are taking advantage of SPP through their workplace. It’s also available on the payroll platform.

Q: You did some interesting research in April 2014 around how important a pension plan is for attracting and retaining employees. Why did you conduct this study and what did you learn from the results?
A: We really wanted to know what employers and employees thought about saving for retirement partly as a way of helping us frame our message to these groups. And we learned that the expectations of the two groups are quite different.

For example, 57% of employees surveyed said a pension plan is very important in deciding a new career opportunity. They also ranked pension plans as more important than cash bonuses. But because employers assumed the opposite there was a disconnect between what employers thought their employees wanted and what employees really wanted.

We also found (not really surprisingly) that only 12.5% of employers surveyed offered a pension plan. Those that offer plans do so because they feel it’s the right thing to do and as a way of attracting potential employees. Most companies that don’t offer a pension plan cited the cost as the main reason.

Q: How would you respond to small employers who say they can’t afford to set up a pension plan because it’s too expensive and too time consuming to administer?
A: Well, it certainly doesn’t have to be that way. Using SPP as an example, it’s very easy to set up. We handle all the paperwork, and the employer simply establishes the payroll deduction and the payment schedule. We handle the employee signup, the questions, the distribution of the tax receipts and statements. I think we take the complexity out of the equation and allow employers, no matter how small, to set up a pension plan. Furthermore, in discussions with employers, we found that offering a pension plan is a very important tool in retaining and attracting staff, especially for the small employer. I think a lot of people don’t expect a small employer to be able to offer a pension plan so it’s a way of helping them distinguish themselves from their competitors.

Q: Do you have sort of a ballpark number of your employers who put some money into the plan to employee contributions? 
A: That’s truly anecdotal because we don’t track that, but I would say half or more.

Q: What happens if someone joins SPP planning to contribute, let’s say, $200 a month but can’t afford to continue contributing for a few months because his car broke down or he loses his job.
A: Life interferes, right? And again, I would have to say that SPP is very flexible in that regard. So contributions can be changed, stopped or started by a member at any time. We know the best approach is to keep contributing, but sometimes it’s just not part of the game plan, and SPP can accommodate those circumstances very easily.

Q: Who determines how members’ contributions are invested, and how can members be sure their money is safe?
A: The plan is governed by a board of trustees, and they are responsible for setting the investment policy and hiring the investment managers. They work with an external consultant to review the investment policy on at least an annual basis, sometimes more often. The board also reviews the managers’ performance on at least a quarterly basis.

Furthermore, we have administrative staff who are monitoring investment performance, and the board reviews it as well. Within the investment policy, the Board has implemented both quality and quantity guidelines. This is a way of reaching the goal of strong returns while controlling risk. Finally, the investment managers invest in companies of the highest quality.

Q: Are there any plan changes or enhancements on the drawing board you can talk about?
A: Well, we’re always looking at our web services and seeing what enhancements we can make in that area. For instance, we often get members looking for their tax receipts or statements online, and we’re certainly looking at how we can enhance that online experience, but only as we can afford it.

We are very mindful that we are dealing with member funds and we must keep expenses as low as possible so that more can be returned to member accounts.

Q: If readers want to find out more about the plan and fund performance, what sources of information are available to them?
A: We have a number of sources: obviously our website, saskpension.com, our blog, savewithSPP.com and our toll-free line 1-800-667-7153, which is available all across Canada. We also encourage members to sign up for our monthly newsletter which is another source of ongoing information.

Q: Thank you very much for talking to me today, Katherine.
A: My pleasure, Sheryl.


This is an edited transcript of a podcast recorded on December 14, 2014.