Slavic 401K Brochure

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Inrullment
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Investment
Irnup
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Integrated
fdministratitn
[$1fl]
SIA servesasa Third ParryAdminisffaror ro qualified
retirementplans.SIA was founded in 1995 ro concentrate on PEO, mudtiple employerplan administration
and compliance.It containsrhe systems,staffand expertise necessary
to meld and deliverthe fully bundled 40lk
plan product sponsoredby the Slavicgroup of companies.
Using Reliussoftware,along with proprietarytrading and
web enabledsystems,completeserviceis provided to both
Thesemanagedportfolios comewith an extrachargeof
25 basispoints and provide an alternativeto participants
not wishing to self direct their accounts.If the plan sponsor approves,
all fund revenue(l2b-l,subTA) commonly
paid to brokersand investmenradvisors,is refundedto
participant accounts;this featureensuresSMF delivers
unbiasedinvestmentrecommendationsand selectsthe
bestperforming funds available.
sponsorsand participants:this entailsall functions neces-
Ieprsiturg
$ervices
Inc[[$l]
saryto administera qualified plan in a competitivemar-
DepositoryServices
Inc.(DSI),a DBA for Slavic
ket place.In conjunction with a bundled serviceplat-
IntegratedAdministration, Inc.(SIA), operatesa segregar-
form, is S[A's focuson Multiple Employer Plan compli-
ed bank accountutilized for processingcontributions and
ance,which is unique to the PEO industry
participant directedtransactions.Funds remain in this
asdictatedby IRS RevenueProcedure2002-21.This
accountonly on a short-term basis,as they areforwarded
concentrationenablesthe PEO to operarea cost effective
to mutual funds for tradesor disbursedto participantsfor
plan within the very complex regulationsgoverning
distributions,loansand rollovers.No interestis paid on
this industry.
the float and no feesarechargedto participantsfor useof
this account.
Slavir
Investment
Iorpuratiln
[$1il
SlavicInvestmentCorporation (SIC) is an NASD
Broker/Dealerand a memberof SIPC.Foundedin 1988,
SIC focuseson providing mutual fund platforms to
retirementplans.As an independentbroker dealerutilizing the Sunguard/Fideliryclearingarrangemenr,we can
offer any fund for trading, without being tied to one fund
family or product. This structureis true open architecture, whereby 12b-l feesand other fund revenuecan be
reimburseddirectly to participant accounts.Therefore,
SIC providesthe trading link, allowing participantsto
exchangemutual funds acrossmultiple fund familiesat
no charge.
$lavic
ilutual
funds
ffi
anagement
hrptratitn
[$ilt]
As an SEC registeredinvesrmentadvisorand plan fiduciary, SMF ana\zes, monitors and recommendsmutual
funds asinvesmtmentoptions for retirementplans,subject to the approvalof the sponsor'sinvesrmentcommittee. In addition, SMF offersindividual investmentadvice
to participantsat no chargeand managesthree portfolios
asextraoptions embeddedin the mutual fund platform.
$fl$
tlo70fludited
Foundedin 1995,slavic4Olk.com
administrates
Defined
Contribution Plansas third parry administratorworking
in conjunction with SlavicMutual FundsManagement
Corporation (a registeredinvestmentadvisor)and Slavic
InvestmentCorporation (a NASD registered
Broker/Dealer).The recordkeepingfunction of the plan
is the responsibiliry
of slavic401k.com.
The recordkeeping servicesperformedadhereto the guidelinescontained
in the American Institute of Certified Public Accountants
(AICPA) Statementon Auditing StandardsNo. 70, enti"Service
tled
Organizations"asamendedby AICPA
"Service
Statementon Auditing StandardsNo, 88 entitled
Organizationsand Reporting on Consistency."
IuturB
Building
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TrBuild
fl[inanciallu
u
Iuture
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Trdag
It is up to eachand everyone ofus to responsiblysave
and preparefor retirement.To help you accomplishthis
important goal, one of the most innovative401(k) plans
is now availableto you aspart of our comprehensivebenefits program.This vehicleis essentialin building a sound
and securefinancial future.
The funds that comprisethe 401(k) plan aresomeof the
bestfunds from someof the bestfund families.Tney
havebeencarefullyselectedto crearea broad crosssection
of funds from many different investmentsryles.
Hopefully, this will provideyou with excellentinvesrment
choicesin almost any qpe of market conditions.
Your companyis offering you one of the most cost-effective and progressive
retirementplansin the country.
\With this plan, you can look forward to savingand
investingto meet many of your personalfinancial
challengesin retirement.
You arestrongly urged to participatein this valuable
program - a plan that was specificallydesignedto
meet your needs.
[idllJe
tlJhg
[hmse
slaviclril
hctm?
Cost-Effectiveness
Alongsideyour companyis slavic40lk.com,the administrative arm of our plan, which seelato provide low-cost
administration.In largepart, this is due to the integration
of systemsand to the largenumber of plan participants
servicedby Slavic.The web site (slavic40lk.com)is a
quick, efficient and cost-effectivemeansby which participants can gain valuableaccountinformation.
401
fl$ecure
luture
lhlBuilds
For The Employee
Savingfor retirementis your responsibiliryand in light of
the dim prospectsfor SocialSecuriry the needfor a taxadvantagedlong-term savingsprogram is a necessiryfor
almost everyone.It is estimatedthat by the year2010
more than half the population age65 and older will be
living below the poverty level.Your company-sponsored
401(k) offersa payroll savingsplan that can help you preparethe financial foundation you needto preparefor a
financially securefuture.
Slavict 40 1(k) is not only an excellentfinancial vehicle,it
is one of the most cost-effectivebenefitsoffered.The
plan:
. Institutesa vitally important savingsplan.
. Keepsyou informed about your investment.
. Providesparticipantswith accessto personalaccount
information via the Internet at slavic401k.com.
t|iUhlights
rf IhePlan
t|ighlights
0fIhe4il[h]Plan
1. Low Administration
Cost
Typically,the high cost of administrationmakesthe
401(k) impracticalfor most small to medium-sizedbusinesses.
The economyof scaleachievedby slavic40lk.com
makesthis 401(k) cost-'effective
and workablefor your
4. Quality Investment Choices
Highly rated noload funds that provide a broad
spectrumof diversifiedinvestmentsand management
styleshavebeenselectedfor our 401(k). That means
you will haveaccessto funds that may achievevarious
retirementgoals.
company.
5. Specialized Reporting
Z.PerconaBzed
& Record Keeping
The slavic40lk.com reporting sysremprovides
Service
The registeredrepresenratives
of slavic40lk.com areavailableto you for your individual needs,either in personor
via our toll-freecustomerserviceline.
specializedreportsfor companyownersand
plan participants.Statementsaremailed to plan participants'homeswithin I 5 daysof the end of eachquarrer.
Statementsarealsoavailableonline.
3. Asset Allocation
Investment
Portfolios
SMF offerspre-allocatedinvestmentoptions basedon
aggressive,
moderateand conservativeportfolios.These
portfolios take advantageof the mutual funds that are
suitableascore investmentsfor retirementplans like ours
and allocateassetsaccordingto risk profiles.
6. Ease OfAccess
slavic40lk.com offersa comprehensive
web site that
allowsusersto accessand make chansesto their accounrs.
T.Erllrail Express
Upon request,a unique Email serviceis availablero you.
Every Friday afternoonyou can receivevia Email your
401(k) accountbalanceand a brief commentaryof that
weekt market activiry.
Iheregistered
reprEsBntatiues
nfslauic4il
hcnrn
are
avarlahle
fnrU0rlr
tr gnu
indirridual
need$,0ither
in
pBrs0tt
0rttia0ttrttll freerr$t0lner
line
$Etttire
fldrrnrtr
Iarr
The
flduantage
4il[]rlTarr
years.So, you would pay significantly lesstax overall.
However, if you qualify to take money out of your plan
**Pre-Tax Contribution
beforeage59 ll2, you must not only pay income tax on
All contributions to yoru 401(k) plan aremade in
it at that time, but dso pay a l0olopenaltyaswell.
pre-income-taxdollars.Your contributions are subjectto
FICA tax but not to income tax. Depending on how
much you contribute, this can mean hundreds - wen
thousands-
The Power of Long-Term
Compounding
The chart below illustrates the long-term effect of
ofdollars in tax savingseachyear.You are
different ratesof return and compound growth. It uses
allowedto defer up to $15,500 (subjectto future cost of
an initial investmentof $5,000 with annual contribution
living increasesby the IRS). In addition, pardcipants age
"catch
up" contributions to the
50 and over may make a
of $2,400.Assumedratesof return arc 4o/o,7o/o,l0o/o
and 12o/o.
plan in the amount of $5,000. (Highly-Compensated
employeesand company owners may have lower limits.)
Tax-Deferred
Growtl'
Like the contributionsyou regularlymake to your 401(k)
plan, the growth of your investment is not subject to tax.
Long-TermCompoundedGrowth
The 15o/oto 39o/otax you pay on your earningseachyear
is eliminatedin the 401(k) becauseit is a tax-defened
investment.
The TaxYou
Do Pay
You pay tax asyou begin to take money out of your plan
when you retire. At retirement, you will probably be in a
lower tax bracket than you were during your peak earning
:,:,Y-':9ry,,,
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Slzuic haestmnx 2006
Accumulation Example
AfterTax
Outsideyour401(k)Plan
Taxes2So/o
Pre-Tax
Insideyour 401(k) plan
-280
-0
Save
'''.t"t:tt' '
*InvestmentGrowth @ 8olo
58
80
Msre
In Your
4ot{t)t
Net investmentgain
*Hypothetical Return for illustrativepurposesonly. Your actud retum will vary and may be lower.
You pay income taxeswhen 1ou withdraw your funds. Exampleassumes
a 280loax bracket.
@ Copyight Slzaic Inuestmmx 2006
**lfyour enrollmentform includs a Roth 401(k) deferraloption, you may designateall or a portion ofyour contribution asa Roth 401(k) deferral.In a
Roth 401(k) account,your investmentswill grow tax-free.You pay uxes on your deferals up fiont and pay no taxs when you baome eligiblefor distribution after age59 ll2.Youmey not defermore than $15,500 bemeenboth the Roth andTiaditional 401(k) accounts.Your financial advisorcan help you
determineifit makessensefor you to makeRoth 401(k) contributions to your account.
BurldinI
Yrur
Prrtfolit
Building
Yuur
401[r]
Pnrtftlio
a broad crosssectionof funds. Each participanrmay
In general,the 401(k) is a long-term investment.How
"long-term"
dependson the number of yearsyou have
selecttheir own funds or one of the SMF pre-allocated
left beforeretirement.The rypical401(k)portfoliocon-
portfolios; you cannot chooseboth. You may creareyour
sistslargelyof stock-orientedfunds becausethey arecon-
The investmentchoicesin the 401G) wereselectedfrom
own portfolio by selectingavailablefunds and allocating
sideredby most expertsto be the bestchoicefor long-
varying percentages
ofyour contribution to eachone.
term growth. However,there is a higher degreeof risk
With the asset-allocation
option, you can selectone of
associated
with a stockversusa bond or fixed-income
three portfolios:Aggressive,Moderate,or Conservative.
investment.Thatt why the aggressive
investorshould
As a 404(c) designatedplan, the participant, not the
weight his or her portfolio more heavilyin rhe stock area,
trustee,is responsiblefor investmentreturns basedon
while the more conservativeinvestorshould choosemore
market performance.
bond and fixed-incomeinvestments.
\Whileyou cannot allocateone portion of your contribu-
If you are20 to 30 yearsawayfrom retiremenr,a more
tion directly to individual funds and anotherportion to
aggressive
portfolio is recommended.The closeryou are
the pre-allocatedportfolios, you can changethe alloca-
to retirement,the more conservativeyour portfolio
tions in your self-directedportfolio asyou choose.You
should become.
can switch benveenthe self-directedand the pre-allocated
portfolios asyou wish. (AIl changesmust be made
SMF representatives
are availableto assistyou in making
through slavic40lk.com via the web or by faxing or
the right investmentchoicesfor your 401(k) portfolio. As
mailing a changerequestform to the CustomerService
a plan participant,you will receiveimmediatepersonal-
Department.)
ized assistance
simply by dialing the toll-free telephone
numbeq1.800.356.3009.
lf gou
rrBfI tt 3[Usars
altraU
frum
retirernsrt,
p0rtfoliu
atn0fB
ag[rsssitte
isrBc0]ntnerded
Ihechser
flrst0retiretnBrt,
themnre
U0tt
pnrtftlin
r0ltsErvative
sh0rrld
h0r0lns
U0ttr
ffiutual
Iund
The mutual funds availablein your plan havebeenselect-
Thesetwo factorsare important in determiningthe
ed to provide a broad selectionof investmentoprions.
performanceand risk characteristics
of the funds. The
The Morningstar Equiry Fund SryleBox providesan
Morningstar Bond Fund StyleBox summarizesrwo
instant snapshotofrwo essentialcharacteristics
ofthe
essentialrisk factor in any bond fund: interestrate
funds that make up the investmentline-up: the sizeand
exposureand credit exposure.
the styleof the companiesin which the fund invests.
tquitg
$tgle
Iorr
Equity Style refersto the way
companiesarevalued.Some
companiesappearto be expen-
Equity Size refersto the
averagemarket capitalization
ValueBlendGroMh
of the companiesin which the
sivein relation to their currenr
fund invests.This is important
Large
earningpower but provide
excellentgrowth opportunities.
becausethe behavioroflarge
companiesdiffersfrom that of
Theseareknown asgrowth
Medium
smallerones.
companies.Conversely,others
trade at a low multiple to cur-
Small
rent earningsbut arenot expected to grow.Thesearecalled
valuecompanies.
firred
Inuums
$tUlB
Borr
Interest Rate Exposure is
Credit Quality refersto
the risk of default that is
an important elementin measuring the risk of fixed income
investments.Generally,longer
dated instrumentsare riskier
rhan shorterones.Changesin
inherent in fixed income
Short lnt.* Long
securities.An averagerating
High
inreresrrateswill affectrhe price
of longer-termbonds more than
portfolio by specialistcredit
rating agencies.
An overall
Medium
that of shorter-termbonds.
scoredeterminesthe
levelof credit risk in the
Low
*Intermediate
is assignedto bonds in the
portfolio. Any fund that
investsin governmentsecuritieswill havea high credit
rating.
Source: Morningstaxcom
Pntential
flish-flerlrard
Purtfnlin
$electinn
In the Self-DirectedPortfolio, the participant selects
the limits of the plan. SMF representatives
will assistpar-
his/her choiceof invesrmenrsfrom the Specialry
ticipantsregarding
theirinvestment
options.
Investment,International,LargeCapitalization,
It is recommendedthat you allocateyour assetsamong
Small/Medium Capitalization,Bond and Money Market
severalfunds. As the value ofyour portfolio increases,
fur-
fund categories.
Thesefund selectionscan changewithin
ther diversificationshould be considered.
Funds fall into different ranges of
risk/reward and catagories.
Lower
S€lect an allocation of funds
TY
upon your risk profile.
Specialty
Investments
Htgber
International
Funds
SmalVMedium
Capitalization
Funds
Iarge
Capitalizatton
Funds
Bond/Money
Market Funds*
Potential Risk/Reward
A CopyrightSkuicInuestments
2006
Specialit7inuestmentsarec0nCentratedinCertainsectionsofthemarleetsthatgeneralfhaueahigherrishthantheouerallmdrbet'Theseinuestm
portionof7ourouera/lportfo/io'D0notexceed]0%oof7ourtotalnsetsinan7oneofthesefundsor30o/oinan1combination,Conseruatiueinustorsclosertoretirementsh
not inuestin speciahy
funds without profesiona/ guidance.
T\br1obalancingtherisb/rewardrektionshipof7ourouerallporfolioisawel/diuersifedstrateg'Theinuevorqua/if'cationworbsheetonpage
risbprofle. Youma1alsospeakwith your registered
inuestmentadrisor, uisit slauic4)Ih.com or call 800.356.3009to speakwith a representatiue.
A/l Jund shares
arenot insuredor guaranteetl
by the U.S. Goumment.
*Bondorfxedincomefundshauediferentishcharacteristicsthanxockfands.Rishisdeterminedb1thequalit7anddurationofthebondsheldinthefxedincomefu
rpaofJund:a/soCan7interestrdterish,Thereisaninuerserektionshipbetueeninterestratesandbonds'wheninterestratesrise,theualueofbonf/landuhen
fall the ualueofbonds rise. Tbe ualueofsomebondsissuedb7 corporationscan uarydependingon the ualueofthe companys stockand ouerallf.nancialhealth.
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n
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$tntelnB
Investment
Prlicg
g$tatement
Investment
Prlic
The retirementplans investmentoptions are designedto
follow modern portfolio theory,wherebydiversification
through assetallocationallowsplan participantsto better
achieveretirementgoals.The plan document specifies
that it must follow ENSA section 404(c),which means
participantscan investtheir accountbalancesas they
wish, and the trustee(s)and sponsorwill not be liable for
the consequences
of the participantt investmentdecisions.To allow for a wide rangeof investmentalternatives,approximately25 highly rated mutual funds have
beenselectedthat reflectdifferent managemenrsrylesand
assetclasses,
in order for accountbalancesto be properly
diversified.In addition, investmentadviceis offered
through a registeredinvestmentadvisor,not only to the
plan fiduciaries,but alsoto participants.
The InvestmentCommittee selectsthe investment
options after consideringrecommendationsfrom the
advisor.The committeeis appointedby the plan sponsor
and is responsiblefor assessing
the ongoing performance
ofthe plan, for analJzingthe reasonableness
offees
chargedto participants,and for approvingthe communication materialprovided to employeesconcerningdisclosureand investmenteducation.Specificsof the plan fees
To contact any of the plan fiduciariesfor information
concerninginvestmentof plan assets,refer to the
SummaryPlan Description (SPD) or contact Slavic
Mutual FundsManagementCorporation, SEC registered
investmentadvisordba slavic40I k.com.
Investment
Iducatirn
Controlling
Risk
Risk is the chancethat investmentswill fall in value and
not be sufficientto fund the participant'sretirement.
Diversificationand portfolio rebalancingaremethods
usedto control risk. Allocating the portfolio among
mutual funds that arecomprisedof different coreasset
holdings such as domesticstocks,internationalstocla,
RealEstateInvestmentTiusts (REITs), commodities,
bonds and money market will yield greaterstabiliry of
returns.Often, theseassetclasses
rise and fall in value
'When
independently.
severalare down, the money market will hold its value,therebylesseningthe affectof a
"To
downturn in the market.
diversify" is the prudent
way to invest,accordingto most financial experts.The
rise in the S&P 500 stock index over the last 75 yearshas
averagedI I o/0,meaninginvestorsshould expectmarket
volatiliry, but over the long term, the averages
usually
revert to the mean.
and investmentoptions areexplainedin the Summary
Plan Description and the enrollment booklet.
In order to diversi$r,participantsshould investin at least
three different typesof mutual funds, and the portfolio
The trusteeof the plan is responsiblefor safeguardingthe
assetsof the plan held in trust at the variousmutual fund
companiescomprisingthe investmentplatform.
Participantscan exchangefunds at will and at no cost by
executingtradesover the Internet or by contactingslavic40I k.com at 800-356-3009.
should not be traded unlesstheir risk profile haschanged.
In fact, constantportfolio juggling is the worst thing a
participant can do. The odds areagainstanyonesuccessfully timing the market. In that regard,buying and holding index funds is an excellentstrategrto participatein
the market at the lowestcost. On the other hand, rebalancing on a yearlybasisto bring the portfolio in line with
The InvestmentCommittee hasappointeda co-fiduciary
investmentadvisorto renderspecificinvestmentadviceto
participants.The advisoralsooffersthree managedportfolio options that you may qualify for by taking a suitabiliry test that characterizes
investorsas aggressive,
moderateor conservative.
An explanationofthese portfolios
and the test is containedin the enrollment booklet or
found on the web site at www.slavic40lk.com.
the desiredrisk levelis recommended.For example,a
moderaterisk portfolio for someoneage50 would be
35% bonds,4070 domesticlargecap mutual funds and
25o/oin foreign largecap funds. If at the end of the year
bond priceshaverisen so that bonds represent45o/oof the
portfolio, thosebond funds should be sold down to the
35o/oleveland the proceedsinvestedin the other funds
proportionately.This procedurewill help control risk,
Hish
- Investment
[actor
Iducatitn
Iock in gains,and force the investorto allocateinto under
Asset Ailocation
performingfundswithout imposingthe elementof emo-
How much risk one can afford to take is dependenton
tion, which tendsto causeinvestorsto do the oppositeof
the length of time until retirement,overallnet worth and
what they should during market turmoil.
toleranceof marketdeclines.
The most important element in achievingretirementgoalsis not the portfoliot
If the participant electsto usea Slavic(SMF) managed
reurn but the rate of saving.To chasehigh returnsby
portfolio for rebalancingand risk profiling, realizethe
taking on more risk to make up for the lack of savingis
managert objectiveis not to achievea market return but
not prudent.Once the commitmenthasbeenmadeto
a risk-relatedreturn, and there is no guaranteethat any
participatein the plan, it is advisableto continue saving
targetswill actuallybe achieved.SinceSMF rypicallywill
consistentlythroughout up and down marketsand not to
not be activelytrading your accounrbut passivelyrebal-
reallocatethe portfoiio without consultinga financial
ancing once per year,eachparticipant should assess
per-
advisor.For someonethat is investingeverymonth and
formancefrom their statemenrsand prospectuses
to
hasa long-term horizon, a fall in the market can be an
determinewhether or not the servicesuitstheir needs.
opportuniryto acquiremore sharesat a lowerprice.It is
The plan sponsordoesnot endorsethe useofthe
when the participant is closeto retirementthat greatrisk
Advisort portfolios, but realizingthat participantsmay
develops.If the market suddenlydeclinesat that time, the
not be familiar with investingand assessing
risk, this
servicewas addedasan option for an additional 25 basis
Allocation
point (.25o/o)assetfee chargedto the participant choos-
1007"
90"h
SOYo
700h
60"/0
500h
40"k
30"h
200k
10"h
ing it.
SlavicMutual Fund ManagementCorporation is an
SEC-registered
investmentadvisorand is a fiduciary to
the plan employedto renderinvestmentadviceto participants.Call on Slavic'srepresentatives
for any invesrment
questionyou may haveat 800-356-3009.
Risk Allocation Based
UponTimeTo Retirement
3
0
2
5
2
0
1
5
Years To Retirement
1
0
5
2006
A CopyightSlaaicInuestments
participant'sretirementwould suddenlybe in jeopardy.
The Down Market Advantaee
To avoid this risk as retirementnears,investorsshould
reallocatemore to short-term,fixed income investments
Exarnple:Participantallocates
$100 per month to XYZ Fund
$10.00
$s.00
$8.00
$7.00
Price $6.00
per $5.00
$4.00
Share g3.00
that are usuallymore stable.Nevertheless,
bond and
money market funds yieid lessthan stock-relatedfunds
over the longer term. By becomingmore conseryative
with age,one givesup return potential for a portfolio
bearinglessrisk. For example,a participantwith 25 years
to retire should be aggressive
and allocatemost of their
$2.00
$1'00
$0.00
money to diversifiedstock funds; whereas,an individual
1
2
3
4
5
7
6
I
Months Participation
9
10
11t12
If a participant selectsa stoch-orientedmutual fund aspart of his 401 (k) accountallocation and cammitsa f.xed dollar amountper month to thepurchaseof thatfund the
number of sharesaccumukted ui.ll be much greater in dnwn marhetsthat in up markets.
Therefore,down marhetsactually beneft most401(k) participants uho haaea bng time
until retirement. @ CopyightSkuicIweshnentr2006
age50 shouldinvesthalfin high grade,short-termbond
funds. With this analogyin mind, the following table
representsan estimateof potential declineversusreturn.
Investment
Id[|[fltinn c,ntin
lfllll$T0fi
t0ll$[fil|flilllt
Retire in 5 Yearsor Less
Target Return: 5o/o- 7o/o
Risk of Decline: -I5o/o
ffianrftnltr$ron RfifiHr$$ilrr
illllr$T0R
Retirein 6 to 15 Years
Target Return: 7o/o- 9o/o
Risk of Decline: -25o/o
Retirein 15 Yearsor More
Target Return: 9o/o- I2o/o
Risk of Decline: -35o/o
tI|0[il
$r0[t|
r0|l[flrr0[Ril[t|$
60% Bonds& MoneyMarket
25o/oDomesticStocks
1570ForeignStocks
350loBonds
40o/oDomestic Stocks
25o/oForetgn Stocks
200loBonds
50% Domestic Stocks
30% ForeignStocks
A Copyright Slaui Inuestments2006
Each participant should allocateaccordingto the risk-
tradedthe sameday,but only the next businessday is guaranteed.
relatedreturn that fits their objectivesdetailedin a risk
No verbalorderswill be accepted.The next businessday policy is
profile test provided on the investmentadvisort web site,
guaranteedonly if the mutual fi-rndcompaniesand clearingbro-
www.slavic401k.com,
or seeyour enrollmentbooklet.
ker involvedsettlethe trade by the next businessday (T+1) or if
Each participant is advisedto re-takethe risk profile test
lessthan wo billion sharesaretradedon the NASDAQ exchange
everyfive yearsto determineif his/her risk profile has
on the day you placeyour order or on the day after.Iftrading
changed.
volume on the NASDAQ exceedsthe limit or the outsideparties
cannot settlethe tradeasspecified,your order will be processed
Annually, the InvestmentCommittee will comparerhe
on a best-effortsbasis,and Slavicwill not be responsiblefor the
performanceof the fund options againstmarket indexes
timing, only the accuracyofyour trade.The abovepolicy is sub-
and reviewthe servicesof the Advisor to anaJyze
whether
ject to a l4-day errornotification policy following the mailing of
the objectivesof the investmentpolicy are being met.
your quarterlystatementor confirmation statemenrof trade.To
receiverestorationfor any trading error attributableto Slavrc,
-Ilading
Funds
your notification must be recievedwithin the 14 day policy. If a
Exchange
orderswill betradedno laterthanthenextbusiness
correctionis needed,contactSlavicto avoid and/or minimize
day.In mostcases,
exchange
ordersreceived
before2PM will be
damages,if any.
I
t
PrB-fl
llrrate
d
Prrtfrlir
In addition to the variousmutual funds available,Slavic
appropriateallocationof funds to reachtheir investment
Mutual FundsManagementhasdesignedthree optional
goals.They are rebalancedannually to maintain the tar-
pre-allocatedportfolios to make investmentdecisionseas-
getedrisk profile in a rapidly changingmarket and the
ier.The Aggressive,
Moderate,and Conservativeportfo-
advisormay alsochangethe allocation.
lios havebeendesignedto provide investorswith an
Aggressive Portfolio
T Domestic Stocks
40o/o
: Foreign/GlobalStocla
30o/o
I
Bonds
20o/o
RealEstateInvestmentTiusts
10o/o
T Domestic Stocks
20o/o
T Foreign/GlobalStocks
25o/o
I
Natural ResourceStocla
l0o/o
Bonds
35o/o
RealEstateInvestmentTiusts
10o/o
Conserwative
Portfolio
I
Domestic Stocla
20o/o
I
Foreign/GlobalStocla
15o/o
Bonds
40o/o
I
RealEstateInvestmentTiusts
ffi Money Market
7o/o
l8o/o
PortfolioSamples:Actualallocationsare subject
to changeby rhe Advisor.
'We
advisethat you completethe
There is an additional assetmanagementfeeof 0.25o/otf
your investorprofile.
you choosethis service.The Stock Market is inherently
InvestorQualification worksheetin this booklet. Or visit
risky and carefulattention should be madewhen selecting
slavic40lk.comand takeone ofthe testsunderthe head"investor
profile."
ing
the appropriaterisk relatedinvestmentallocationthat fits
@ Copyrigbt Skuic Inuesments 2006
lfl
Investrr
0ualificatitn
ilJurlr$hE
Choosing An Investment
Mix That's Right For You
What Type Of Investor
Decidingwhereto invest
overallscore.Remember,there is no right or wrong answer;eachresponsedependson your
your retirementdollarscan
own personalsituation.
Are You?
Circle the answerthat bestfits your current situation.Add your points to determineyour
be a challenge.
Understanding
somebasicsabout investingwill
help.The key is to choosean
investmentthat bestfits your
retirementinvestmentgoals.This
worksheethelpsyou identiS'your
"Investment
Profile".
DeterminingYour
Investment Profile
Do you know what type of retirement investoryou are?Factors
such aswhen you needyour
money,your ability to accept
Answer the following questions to determine what type of investor you are.
1. !?hat is your age?
O
O
O
O
influence the investmentoptions
you select.This questionnaire
will help you determineyour own
5
Subtotal: -
2. \(hat is your liquid net worth?(Totalof stocks,bondsand cashyou own)
O Under$200,000
o $200,001- $500,000
- $1 million
O $500,001
O over$1 million
3. \,Vhatis your annualincome?
O Under$75,000
- $15o,ooo
o $7t,oo1
- $250,000
o $1t0,001
O over $250,000
investmentfluctuations and your
investmentobjectiveswill all
Points
25
1'
10
20 to 35years
36 to 49years
50 to 62years
over 62 years
11
t2
18
20
Subtotai:t2
r3
r4
I6
Sub total: _
4. How stable is your Employment Income over the next 10 years?
O Very likely I will be continuously employed.
O Probable that I will be employed most of the next 10 years.
O My prospect of employment is uncertain.
O I do not intend to work.
investmentprofile.
r6
u
8
5
Subtotal:-
5. How much lile insurance do you have?
O Lessthan $200,000
Note:
The questionnaire and the
analysisreflect broad generalizations
and are not intended to result in an
exact determination of any of these
- $500,000
o $200,001
O over$500,000
representsone possible assetallocation strategy based on specific
assumedfacrorssuch as age. investment objective and personal goals.
3
Subtotal:-
6. lVhat is your primary investmentgoal?
characteristics for any specific person.
Each of the hypotheticai examples
1
2
O
O
O
O
O
Rishoflos associated
with goal
-15o/o
Incometo liveon.
-30o/o
Growth.
-20o/o
Balancebetweengrowth and income
-20o/o
To fund my retirement.
-70o/o
Capitalpreservation.
S i n c et h e r e i s n ' ro n e p o r r f o l i o m i x
that is right for every investor, you
and your financial representative will
7
25
I6
r4
5
Subtotal:TOTALPOINTS:
want to carefully consider your own
situation.
See next page to waluate your results.
1_l
InvE$tnr
- crntinued
lificatirn
IJJ
rthsheet
0ua
lnvestment
Prnfile
"aggressive
If you scoredover80, you tend to be an
growth'retirementinvestor.You
seekthe maximum return on your retirementmoneyand arewilling to acceptthe risk
that goesalongwith it. Your investmentwill placea significantemphasison growthorientedinvestment.
Aggressive
Investor
Over 80 Points
Single
"
I hauea longtime beforeI raire, soI canliue with upsand downs
to achieue
a higherpotentialreturn.I
in my retirement
inuesttnents
that thereare
want m! monryt0gr\w at a highrate I understand
nogudrantees,
but it mayreallypay of in 35 years."
K
'
e
rk
"moderate
growth' retirement
If you scoredbeween 61 and 80, you tend to be a
investor.You recognizethe needto protectyour retirementmoneyfrom inflation and
arewilling to acceptsomerisk in orderto obtain a potentiallyhigherrisk of return.A
diversifiedapproachwhich includesboth growth and incomeinvestmentsmay make
senseand help you achieveyour goals.
61-80 Points
"
I haueachieuedbalancein my life - and would lihe to achieue
account.I wouldlike to main'
that samebalance
for m! retirement
tain a mix of inuestments
that includesbothgrowthand income
to obtainthis balance."
producingobjectiues
Consenrative
Investor
"conservative
grow*i' retirementinvestor.
Ifyou scoredbelow61, you tend to be a
You'remore comfortablewith lower-riskinvestmentsknowing that you may be giving
up a potentiallyhigher return. Investmentsthat focusprimarily on providingincome
You should
your objectives.
and capitalpreservationmay be appropriatefor addressing
to help protect
considera growth-orientedinvestmentfor a portion ofyour assets
your retirementnesteggfrom inflation.
"
I'ueworkedmanyyars puxing a litth bit awayeachyearfor
retirement.Thatlixle bit hasaddedup nlw - s0Im naturallyconcernedaboutheepingthemalorityof thuefunds intact.At thesame
againstinflationerodingthepurchasing
time,Im seehingprotexion
powerof my monry."
l4
rc
) Married with three grown children
6o Points or Less
A CopyrightSlauicInuesments2006
nfBenefit
$umlnrrU
Eligibility:
"ffi;,
12 monthsof service
and 1,000hours.Eligibilityrequirements
maybelessif soadoptedby your
ilfn
Contributions:
Compensationis all gross'W-2earningsbeforedeferrals.
The minimum deferralis 170of comoensation.
You candeferup to $15,500or the plant deferralpercentage
limit asspecifiedin the SPD,whicheveris less.
Owners,their linealrelativesand certainhighly compensated
may be limited.
employees
"catch-up"
Participants
age50 or overcantakeadvantage
ofthe
provision.
Change
Investments:
Exchange
orderswill be tradedno laterthan the nextbusiness
day.In mostcases,
exchange
ordersreceivedbefore2PM will be
tradedthesameday,subjectto Slavicttradingpolicyaspostedon thewebsite.
Reporting:
aresentto yourhomeon a quarterlybasis
Statements
Matching
Discretionary
employercontributionto eachemployeetaccount,if adoptedby yourwork siteemployer.
The matchingcontribu-
Loan Provision:
Up to 500/oof the vestedamounrin participanttaccounr
Minimum$1,000- Maximum$50,000
- l-5-yearamortization
Repayment
schedule
4 to 5 weekprocessing
time
paybackschedule,
Distributions:
Distribucions
canbe madeout of theplan:at retirementor age59ll2,inthe eventof long-termdisabilirydeath,or uponterminationof employment
from yourPEOandyourwork site.Hardshipwithdrawals
canbemadeaftertheloanprovisionhas
beenutilizedif oneof the followingcriteriais met:to avoidevictionor foreclosure,
purchase
of primaryhome,qualifiingmedicalexpenses,
funeralexpenses
educationfor you,your
andpaymentof tuition or relatededucationfeesfor post-secondary
spouse
or yourchildren.Thesewithdrawals
anddocumentation.
Distributionsmaytakeup to
aresubjectto taxandpenalties
60 daysfrom receiptofpaperworkto process.
To expedite
a distribution,you cansubmityourrequestonJine.
Plan Expenses:
To coverassetmanagement
andplanadministrative
costs,a feeschedule
will be assigned
to your account.
The feescoverIRS
contributions'
::i:in:'fi::iffitr;:T:."ffi;::'lm:::ffi',1;?:l;ti:;l*:$;l'j;ffiril:::fi:::*:.il'"'rves'
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***fui'*rm:xfu
i
t't[:##*:+.l]i'n:fr
;*[h',:ffi
"Class
A" shares
at NAV (NetAssetValue).
Fund Charges:
The planutilizeseitherno-loadmutualfundsor
Retirement Age:
of theirvestedaccountbalance
The plandocumentrecognizes
65 yearsof age.Participants
maytakein-service
distributions
at
age59 ll2.
Immediate
Valuation and
Questions:
SMF
\fleb Site
(800)356-3009 (AccountQuestions
andInformation)
www.slavic40lk.com
lX
For up-to-date fund and performance
.^:,
-':;
"". -"T
sl.Auc M|TUAt,FINDS
MANACEMEmcoRmHTIoN
SlavicInvestmentCorporation (SIC)
Member SIPC & NASD
SlavicMutual Funds ManagementCorporation (SMF)
RegisteredInvestmentAdvisor
N\7, Suite 100
1075 Broken Sound Parlorzay,
BocaRaton,FL33487
561.24r.9244or 800.356.3009
Fax 561.241..1070
information,
as well as details on your
401(k) plan administration by Slavic
Integrated Administration,
log on to our
web site at www.slavic40lk.com
umil
shttb{0lk
.(ocfl
All matoial and information witbin this domment is
@Copyrigbt Skuic Iwettmentt 2006. Reproduction of any of
its content is forbiddcn bt law.