Lately GSI has been getting a lot of questions from Plan Members about their options with respect to benefits and pension as they retire. Since one of our Board Directors has recently retired, I thought it might be helpful to ask him to share his experience. His comments about Benefits are below; Part I of his interview appeared in the January Benefits newsletter. —Lisa Thiessen, Executive Director
Decision-Making at Retirement: Pension
One GSI Director's Experience
Lisa: Can you tell us a bit about your experience retiring in late 2022? How did you decide what to do with your pension?
Gordon: I didn’t make the decisions alone! Both Barb in the GSI Office and my financial advisor were very helpful.
Barb informed me about the options I had, what needed to be done depending on what option I chose, and the deadlines for each option. She guided me, step by step.
Lisa: How did you choose your financial advisor?
Gordon: Since my wife and I have access to a free financial advisor with our bank, we took advantage of that. We know that our bank has a good reputation, and the advisor we met with was highly qualified. The advisor seemed very competent and importantly, was a great personality fit for us.
Lisa: Can you share any advice they provided that you thought was helpful?
Gordon: The advisor reminded us that even if the markets were down when I retired — which they were! — we should be mindful that retirement happens over a long time. When I transfer my ELCIC Pension Account, the money will still be invested, and it will have the opportunity to grow — even during retirement. It wasn’t as if I was going to spend it all at once!
Lisa: That’s so true. It is easy to forget that the amount in the account at the time of retirement isn’t carved in stone. No matter where it is invested, it will continue to grow over time. What else did you learn?
Gordon: Two things. First, the advisor helped me decide whether to apply to start receiving my Canada Pension Plan and Old Age Security payments right away — or to delay them until age 71, in order to maximize the amount of money I could draw from those funds. We tend to forget that we actually have more than one pension plan to deal with when we retire!
Secondly, the advisor showed us that it made more sense to consolidate all our pension funds together, in order to manage the funds effectively and co-ordinate withdrawals to keep our tax burden low.
Lisa: Did you gain any insights about the transition to retirement?
Gordon: When I retired, I thought that that would the end of my connection with the ELCIC Pension Plan. But like many retired pastors, I plan to be doing some part-time work in the near future. I was delighted to discover that, since I’m still under 71 and meet the eligibility enrollment criteria, GSI will ‘re-open’ my ELCIC Pension Account for future contributions.** When I retire again, it will be a simple matter of transferring the accrued money out of this account into the plan of my choice.
Lisa: I know that as a GSI Director, you are 
aware of the ELCIC Post-Retirement Group Plan, which also has the option to consolidate both the member’s and the spouse’s work pensions and any personal savings such as RRSPs. Can you share why you did not choose this plan?
Gordon: Sure. James Ralko at Eckler is great to work with, and the group plan has very competitive fees. However, for our particular financial situation, it worked best to continue with our financial advisor, as we had already made a good connection with them.
Lisa: That is really important; you have to be comfortable with the person who is managing your retirement accounts. For Plan Members who don’t have an advisor or maybe have moved out of the country, the ELCIC Group Retirement Plan would be a great option. Gordon, you get the last word: anything else?
Gordon: I really want to emphasize that Barb made it very easy to work through this whole process, and I want to thank her and everyone at GSI for all their support and guidance.
**Note: When a pension account is settled and the funds transferred out, if the pastor returns to work within the ELCIC and meets eligibility (monthly earnings of 25% of YMPE), then re-enrollment and pension contributions are required. If the pastor does not meet eligibility on return to work after the pension account is transferred, then no additional contributions can be made. If a Plan Member is hoping to continue contributing during gradual retirement until age 71 — e.g., for pulpit supply or for an interim position — then they should consider deferring the transfer, if that is a financial option, in order that pension contributions can continue on a minimal salary.
What Happens to Your Pension at Retirement?
At Retirement
When you retire, your account balance must be transferred out of the ELCIC Pension Plan and into another retirement plan vehicle, where it will continue to grow and create the income you will need in retirement.
Many Plan Members choose to participate in the ELCIC Post-Retirement Group Plan, which is summarized on the GSI website. This Plan has greater flexibility and lower fees than some other options available in the market have.
The options available to create your retirement income will vary according to factors that include:
- your province of residence
- your age
- whether you have locked-in funds or non-locked-in funds — or both
When you notify GSI of your intent to retire, we will send you a customized list of your options.
Upon Turning 71
ELCIC Pension Accounts must be transferred out of the Plan by the end of the year in which a member reaches age 71.
If you are still working in the year you reach age 71 and plan to work to the end of the year, all of the pension contributions must be received as an advance by GSI no later than September of that year. GSI will then outline your options and provide you with the forms needed. These forms must be back to GSI by November 15 in order to complete the transfer within the bank’s deadline.
GSI will work with you and remind you of what is needed as the time comes so that your pension can be set up properly.
ELCIC Pension Plan Statements
Member statements for January 1, 2023 to December 31, 2023 were sent to members in January 2024 by email. Please contact GSI if you did not receive yours, or if you can’t find your password.
We would appreciate your careful review of the statement and updating us with any corrections or changes to your personal information as soon as possible.
Remember to save your statement in your personal records.
February 15 is Pension Awareness Day!
The Financial Services Regulatory Authority of Ontario (FSRA), the regulator of the ELCIC Pension Plan, will celebrate National Pension Awareness Day on February 15.
Recently FSRA surveyed 1000 adults in Ontario and found that:
81% of respondents are more concerned about paying for basic necessities like groceries than saving for retirement, with 44% citing the high cost of living as a barrier to retirement savings.
This statistic is not surprising, but it is concerning. As we file 2023 taxes and consider contributing to RRSPs, now is a good time to ask, “How can we balance the needs of our current and future selves?”
Younger Plan Members in particular are encouraged to make additional pension contributions if they can, as the longterm benefits are the greatest for them. The tax savings can make it easier, since income tax on pension/RRSP contributions is deferred until the money is withdrawn. Contributing now may lower your tax owing for this year. In most cases, retirement income is lower; for those who are in a higher tax bracket now, income withdrawn in retirement should eventually be taxed at a lower rate than it would be now.
Your future self will thank you!
Investment Results & Notes
For the Fourth Quarter of 2023
Overall Analysis
The last three months of 2023 brought positive investment results that will add to your member pension account.
Overall, in 2023, the economy was strong, and companies had better earnings than were expected. Technology companies did really well, and it is thought that this is due to the trends in artificial intelligence. In fact, nearly half of the global market return for the year has been due to the “Magnificent 7” (Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla), according to the Plan’s investment manager PH&N.
Inflation seems to be moderating, and the supply chains issues we have all felt seem to be largely resolved.
The GSI Board carefully reviews the decisions made by the investment managers and the investment results on a quarterly basis to monitor the financial health of the retirement assets.
The investment return, before expenses, for the ELCIC Pension Plan for January 1 to December 31, 2023 is 10.3%.
ELCIC Pension Plan
| ELCIC Pension Plan Investment Return | Median Balanced Pension Plan as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 7.9% | 7.8% | 0.1% |
| Jul 1 to Sep 30, 2023 | -3.5% | -2.1% | -1.4% |
| Apr 1 to Jun 30, 2023 | 1.1% | 1.2% | -0.1% |
| Jan 1 to Mar 31, 2023 | 3.9% | 4.5% | -0.6% |
Details for each fund and for each quarter compared to a benchmark can be found below. Top ten investments by fund can be found on the GSI website.
Please note that this information is not intended to be investment advice or to be a recommendation for your personal investment portfolio. The content is intended for information purposes only and should not be disclosed to other third parties or used for the purposes of market timing or seeking to gain an unfair advantage.
Growth Fund
Here is a closer look at each portfolio within the Growth Fund.
PH&N Canadian Equity Value Fund
This fund had a strong performance result at 8.0% this quarter, which was just shy of the S&P/TSX index of 8.1%. PH&N says this is because they had a bit of excess cash on hand waiting for a better opportunity, but that caused a drag on the result due to the strong market. They however, made some interesting new investments in in WSP Global, an engineering consulting firm and CAE, a flight simulation training company.
PH&N Canadian Equity Value Fund
| PH&N Canadian Equity Investment Return | S&P/TSX Capped as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 8.0% | 8.1% | -0.1% |
| Jul 1 to Sep 30, 2023 | -1.7% | -2.2% | 0.5% |
| Apr 1 to Jun 30, 2023 | 1.8% | 1.1% | 0.7% |
| Jan 1 to Mar 31, 2023 | 4.0% | 4.6% | -0.6% |
RBC Global Equity Focus Pension Trust
This global equity fund also did really well this quarter, providing a return of 7.7%. The manager made a number of trades to better position the portfolio for the positive momentum into 2024. Of note is a new purchase into a company called Intuit, which has a suite of synergistic software including:
- Turbo Tax (income tax return filing)
- QuickBooks (small business accounting)
- MailChimp (direct marketing)
- Credit Karma (credit score and reports)
- Mint (personal finance and budgeting)
RBC Global Equity Focus Pension Trust
| RBC Global Equity Investment Return | MSCI World ($CAD) as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 7.8% | 8.8% | -1.0% |
| Jul 1 to Sep 30, 2023 | -2.6% | -1.3% | -1.3% |
| Apr 1 to Jun 30, 2023 | 0.8% | 4.6% | -3.8% |
| Jan 1 to Mar 31, 2023 | 2.8% | 7.8% | -5.0% |
Baillie Gifford Global Equity Fund
This fund returned a smashing 11.0% this quarter, beating the MSCI World index by 2.5%.
Of particular interest to plan members may be Baillie Gifford’s climate audit, which showed that 23 companies in their portfolio (representing 28% of the assets being managed within the portfolio) have improved their climate audit rating since December 2021.
Baillie Gifford continues to engage with the companies in the portfolio on a range of topics which, in this quarter included:
- employee rights
- supply chain transparency
- board diversity
- renumeration
Baillie Gifford Global Equity Fund
| Baillie Gifford Global Equity Investment Return | MSCI World ($CAD) as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 11.3% | 8.8% | 2.5% |
| Jul 1 to Sep 30, 2023 | -5.9% | -1.3% | -4.6% |
| Apr 1 to Jun 30, 2023 | 4.6% | 4.6% | 0.0% |
| Jan 1 to Mar 31, 2023 | 7.5% | 7.8% | -0.3% |
Other Fund Results
Here are the results of the remaining funds, for your information.
PH&N Core Plus Bond Fund
| PH&N Core Plus Bond Fund Investment Return | FTSE Canada Universe Bond as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 8.6% | 8.3% | 0.3% |
| Jul 1 to Sep 30, 2023 | -3.9% | -3.9% | 0.0% |
| Apr 1 to Jun 30, 2023 | -0.3% | -0.7% | 0.4% |
| Jan 1 to Mar 31, 2023 | 3.4% | 3.2% | 0.2% |
PH&N Core Plus Bond Fund
| PH&N Core Plus Bond Fund Investment Return | FTSE Canada Universe Bond as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 8.6% | 8.3% | 0.3% |
| Jul 1 to Sep 30, 2023 | -3.9% | -3.9% | 0.0% |
| Apr 1 to Jun 30, 2023 | -0.3% | -0.7% | 0.4% |
| Jan 1 to Mar 31, 2023 | 3.4% | 3.2% | 0.2% |
PH&N Mortgage Pension Trust
| PH&N Mortgage Pension Trust Investment Return | FTSE Canada Short-term Bond as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 4.5% | 4.1% | 0.4% |
| Jul 1 to Sep 30, 2023 | 0.0% | -0.1% | 0.1% |
| Apr 1 to Jun 30, 2023 | -0.2% | -0.8% | 0.6% |
| Jan 1 to Mar 31, 2023 | 2.9% | 1.8% | 1.1% |
PH&N High Yield Mortgage Fund
| PH&N High Yield Mortgage Investment Return | FTSE Canada Short-term Bond as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 2.2% | 4.1% | -1.9% |
| Jul 1 to Sep 30, 2023 | 1.4% | -0.1% | 1.5% |
| Apr 1 to Jun 30, 2023 | 1.0% | -0.8% | 1.8% |
| Jan 1 to Mar 31, 2023 | 1.9% | 1.8% | 0.1% |
PH&N High Yield Mortgage Fund
| PH&N High Yield Mortgage Investment Return | FTSE Canada Short-term Bond as a comparison | Excess return | |
|---|---|---|---|
| Oct 1 to Dec 31, 2023 | 2.2% | 4.1% | -1.9% |
| Jul 1 to Sep 30, 2023 | 1.4% | -0.1% | 1.5% |
| Apr 1 to Jun 30, 2023 | 1.0% | -0.8% | 1.8% |
| Jan 1 to Mar 31, 2023 | 1.9% | 1.8% | 0.1% |
Have a Question for GSI?
We welcome your questions and feedback!
Information and resources can also be found on the GSI website.
GSI Website: elcicgsi.ca
Winnipeg Residents: 204-984-9181
Toll Free: 1-877-352-4247