August 2022 Edition

A new campaign is being added to our automated communication campaigns to reinforce engagement in saving for retirement.

The Investor profile campaign invites plan members to complete the Investor profile questionnaire in their online account to ensure their investment instructions accurately reflect their current situation.

If this campaign is activated for your groups, only plan members who have completed their enrolment will receive the message if:

• They haven’t yet completed their investor profile, or
• It’s been 24 months or more since they updated their investor profile

Do you want your plan members to receive our automated communications?

Contact your client relationship manager now, and we’ll set it up.

Our analyses show that on average, plan members who use the On Target Retirement^® goal tracker contribute nearly 3 times as much as those who don’t.

That’s why we’ll be emailing plan members in September to promote this tool. The email will:

• Highlight the benefits of using On Target Retirement
• Describe how to use the tool to make the most of it
• Explain how to simulate various retirement scenarios to help plan members make informed saving decisions and get closer to their financial goal

We’ll also invite plan members to watch their personalized video where Penny, our virtual guide, makes recommendations based on the information they’ve entered in the goal tracker.

More than a regular goal tracker

Unlike tools that only provide general information, On Target Retirement gives plan members recommendations to help them stay the course and reach their financial goal.

^® Registered trademark owned by Desjardins Financial Security Life Assurance Company.

We emailed a survey to plan sponsors, brokers and consultants who subscribe to The Essential on August 16.

If you received it, please take the time to respond. Your input will help us provide more relevant content. In addition, we’ll donate $1 to United Way for each completed survey!

You can also take the survey right here External link. Opens in a new window.!

The Essential Editorial Team and United Way thank you!

Please disregard this article if your plan has immediate vesting.

What is vesting?

Vesting can be used as a strategy to retain employees. It’s subject to plan membership or employment requirements (as defined by plan rules) up to a maximum of 24 months. Employees are encouraged to remain in employment, failing which, they forfeit their employer contributions.

What happens if an employee leaves before employer contributions are vested?

If you offer a deferred profit-sharing plan (DPSP) or a defined contribution (DC) plan without immediate vesting, non-vested employer contributions are returned to you if you haven’t provided us with any instructions. The benefits forfeited in a given year must be used by December 31 of the following year. This means that the amounts forfeited in 2021 must be used by December 31, 2022.

How to use forfeited benefits?

Depending on your plan rules, you can:

• Receive forfeited amounts in cash or by bank transfer less applicable taxes
• Distribute the unused benefits to your plan members

If you choose the latter option, you must inform Desjardins whether you would like the unused benefits to be distributed to plan members.

Another option is available if you offer a DC plan:

• Pay the administrative fees, the investment fees and any other fees incurred in relation to the plan

If you haven’t already done so, please contact your client relationship manager or call Plan Sponsor Services at 1-888-510-4762 to let us know what you would like to do with these forfeited benefits.

Your employees who are turning 71 this year will need to transfer the assets in their retirement savings plan¹ to a retirement income vehicle such as a Registered Retirement Income Fund (RRIF), a Life Income Fund (LIF), an annuity or other option.

Two things you can do to avoid errors:

1. Let us know by November 15 if you plan on remitting any contributions for these employees between now and the end of the year.
   • If so, we’ll need to receive the contributions no later than December 1, 2022, in order to avoid any potential year-end issues. All contributions received after December 31 will be returned to you.
2. Check that we have the correct address and date of birth on file for these employees, and make sure their names don’t show up in your Missing Information Report. You can remind them to change it themselves with the Omni Desjardins app or on the secure site at dfs.ca/GroupPlanMember, or by doing it for them on dfs.ca/plansponsor.

As of September, Desjardins Insurance will send these employees a statement outlining their options. We ask them to give us their choice by December 1 in order to get a head start on the plan conversion. However, the Canada Revenue Agency gives them until December 31, 2022, to make the choice; otherwise, we’ll apply the procedure for failure to respond. This procedure is explained on their statement of options.

If you have any questions, please call your plan administrator or Plan Sponsor Services at 1-888-510-4762.

We would like to draw your attention to 2 important articles from the How to section that have been published since the beginning of the year.

These 2 articles are about remitting contributions:

On June 23, 2022, Mirova announced the acquisition of SunFunder, a private debt management company that finances renewable energy projects in Africa and Asia.

On June 23, 2022, PGIM announced the hiring of Daleep Singh as Global Chief Economist and Director of Global Macroeconomic Research in the Fixed Income team.

On June 23, 2022, Baillie Gifford announced the appointment of Catherine Flockhart as Head of ESG, as well as the departure of Andrew Cave who was Head of Governance. Toby Ross will be replacing Mr. Cave.

On July 6, 2022, PIMCO announced the appointment of Qi Wang as CIO for Portfolio Implementation, Sudi Mariappa as Global Head of Analytics and Josh Davis as Global Head of Portfolio Risk Management.

On July 13, 2022, AllianceBernstein announced the appointment of Kate Burke as COO and CFO, and Onur Erzan as Global Head of Client Group and Head of Private Wealth.