Welcome to Empower Retirement! - bekbenefits.com

1 Welcome to Empower retirement ! Ben E. Keith Company retirement Plans 2 Agenda Who is Empower retirement ? Your new 401(k) plan at Empower Investment options Transfer of your Ben E. Keith Profit Sharing Plan Demonstration: Contacting Empower retirement 3 Your new service provider We define success as helping people like you work toward replacing for life the income they earned while working. Responsibilities Receiving your payroll contributions Tracking your account balances Providing ongoing communication and education Providing your quarterly statements Providing customer support Click play to learn more about Empower Who is Empower retirement ? Your new 401(k) plan at Empower 5 401(k) Overview A 401(k) plan is a savings and investing plan offered by employers May give participants a tax break on money set aside for retirement A 401(k) plan is a common type of retirement plan companies offer today Here is what you can expect from our new 401(k) Plan: You can contribute money from your paycheck by choosing a percentage of your pay through automatic payroll deductions A tax-advantaged opportunity to build a valuable retirement income The ability to see your balance every day Control over your retirement savings including: How much you contribute How you invest your money and the matching contributions from Ben E.

2 Keith How often you adjust your account to fit your needs Opportunity for growth through interest and investment earnings 6 Employer contributions Employee contributions FOR ILLUSTRATIVE PURPOSES ONLY. Think about a retirement plan like a machine Raw materials in Finished product out Raw materials in Contributions retirement age Investments Finished Product out retirement Income 7 Contributions to your 401(k) plan Pretax contributions and/or Roth contributions You contribute a percentage of your pay The first 401(k) contribution will be deducted for weekly paid employees Pay the week of July 9 1 to 75% of eligible compensation Annual Bonus (separate election): 0% - 90% You will be automatically enrolled at a 4% contribution rate You may increase, decrease or stop your contributions at any time 2018 IRS contributions limits pretax contributions and Roth contributions $18,500 Participants turning age 50 or older in 2018, may contribute an additional $6,000, allowing for a total contribution of $24.

3 500 8 Pretax Potentially lower your current taxable income May mean more money in your pocket today Any earnings grow tax deferred Contribution Withdrawal Tax Toll Tax Toll Tax Toll If tax bracket will be lower in retirement you may pay less taxes at withdrawal Pay taxes on contributions and any earnings as ordinary income 9 Roth *Subject to requirements: Roth contributions must be in your account for at least five years and the money withdrawn after age 59 , death or disability. If distribution is not qualified, the earnings are taxed as ordinary income and may be subject to early withdrawal penalties. Pay taxes on contributions now* Any earnings grow tax deferred Contribution Withdrawal If tax bracket will be higher in retirement you may save by paying taxes now Any earnings are tax-free with a qualified distribution* Tax Toll Tax Toll Tax Toll 10 Pretax contributions vs.

4 Roth contributions Gross pay $ 2,500 - 4% pretax contribution (100) Taxable income $2,400 - taxes* (360) NET PAY $ 2,040 Gross pay $2,500 - taxes* (375) - 4% Roth contribution (100) NET PAY $2,025 Ben E. Keith Today Date Pay to You $ 2,040 Two thousand and forty Dollars Memo 4% pretax contribution Ben E. Keith Today Date Pay to You $2,025 Two thousand and twenty-five Dollars Memo 4% Roth contribution FOR ILLUSTRATIVE PURPOSES ONLY. *Assumes $30,000 annual salary and 15% federal, state, and local tax rate. Please note that taxes on savings are deferred until withdrawal and that pretax deferrals do not lower your income for FICA and FUTA tax withholding purposes. 11 Understand the differences Review Note: When choosing between contribution types, participants must take into consideration their complete personal financial situation.

5 *If distribution is not qualified then the earnings are taxed as ordinary income and may be subject to early withdrawal penalties. Pretax contributions Roth contributions Effect on paycheck Prior to tax withholding After taxes withheld Taxation on distributions Contributions taxed as ordinary income Any earnings taxed as ordinary income Contributions not taxable Any earnings not taxable in qualified distribution* 12 Ben E. Keith Matches the same amount you contribute, up to 4% (it s free money!) Vesting Ownership of company contributions Matching contributions vesting schedule 2 year cliff schedule Prior company service with Ben E. Keith is counted towards vesting Ben E. Keith contributions to your 401(k) plan Years of service Vesting percentage 1 0% 2 100% Investment options 14 Control How You Invest Your 401(k) Plan can be managed based on your personal investment strategy If you do not make an active election Your account will automatically be invested in a Target Date Fund based on your date of birth If you can make an active election You can choose from options that may fit your personal investment strategy Help me do it Do it myself 15 Investor types Help me do it Do it myself 16 Target date funds: How they work What are target date funds?

6 Made up of multiple asset classes Professionally managed Offer a diversified investment in a single fund These funds are meant to align with an expected retirement date The investment allocation will change over time Funds will become increasingly more conservative as the target retirement date approaches Participants may choose to invest in any of the target date funds or any other investments in the lineup As with all investments, the principal value of the fund(s) is not guaranteed at any time, including at the target date 17 Target date funds Target date funds Date of birth Vanguard Target retirement Income Fund Before 1942 - 1947 Vanguard Institutional Target retirement 2015 1948 - 1952 Vanguard Institutional Target retirement 2020 1953 - 1957 Vanguard Institutional Target retirement 2025 1958 - 1962 Vanguard Institutional Target retirement 2030 1963 - 1967 Vanguard Institutional Target retirement 2035 1968 - 1972 Vanguard Institutional Target retirement 2040 1973 - 1977 Vanguard Institutional Target retirement 2045 1978 - 1982 Vanguard Institutional Target retirement 2050 1983 - 1987 Vanguard Institutional Target retirement 2055 1988 - 1992 Vanguard

7 Institutional Target retirement 2060 1993 - 1997 Vanguard Institutional Target retirement 2065 1998 After 1998 18 Point-in-Time Best Interest Advice Empower retirement has a team of specially trained and licensed consultants who will: Act in your best interest Provide you with recommendations at no additional cost to you Help you understand the features of your plan Possible topics include: Investment options in your plan Savings and financial wellness Distributions or rollovers out of your plan Rolling in outside assets into your current plan As with any financial decision, you are encouraged to discuss rolling money from one account to another with your financial advisor/planner, considering any potential fees and/or limitation of investment options.

8 19 Investor types Help me do it Do it myself 20 Investment options: Core funds What are core funds? Building blocks for investors who want a custom portfolio Single fund choices in multiple asset classes Capital preservation Bonds Stocks Risk range of low to high and could include any of the following Market risk Interest rate risk Credit risk Inflation Return potential range of low to high 21 Core Funds Capital Preservation Goldman Sachs Institutional Sable Value Bond Vanguard Total Bond Market Index Aon Hewitt Income Large-Cap Equity T. Rowe Price Blue Chip Growth MFS Institutional International Equity Vanguard 500 Index Mid-Cap Equity Vanguard Extended Market Index Small-Cap Equity Aristotle Small/Mid Cap Equity International Equity Vanguard FTSE All-World Ex-US Index 22 Passively managed funds Track groups of investments representative of a market to measure performance Provide broad market exposure Typically lower operating expenses than actively managed funds Low portfolio turnover Typically a lower return potential than actively managed funds Actively managed funds Managed to try to surpass the total return of a particular index Run by a professional portfolio manager or group of professionals

9 Using research, financial analyses and personal expertise No guarantees of accomplishing the goal of higher returns than benchmark May have higher management fees than passively managed funds A benchmark index is not actively managed, does not have a defined investment objective and does not incur fees or expenses. Therefore, performance of a fund will generally be less than its benchmark index. You cannot invest directly in a benchmark index. Passive vs. Active Transfer of your Ben E. Keith Profit Sharing Plan 24 The Profit Sharing plan will transfer to Empower It is converting to a 401(k) Profit Sharing plan called: Ben E. Keith retirement Savings Plan The investment options will be the same for Profit Sharing contributions as 401(k) contributions Your account will automatically transfer No action is required from you for the transfer of your: Account balances Loan or distribution arrangements, as applicable What you need to know: Transfer of your Ben E.

10 Keith Profit Sharing Plan 25 You will have limited access to your account during the blackout period This blackout period allows for the transfer of the plan s administrative records to Empower During the blackout period The transferred assets will remain invested in the market The assets will continue to gain and/or lose value depending on market conditions When the blackout period ends, you will have full access to your plan account Please evaluate your financial circumstances and the appropriateness of your current investments in light of this temporary restriction What you need to know: Transfer of your Ben E. Keith Profit Sharing Plan 26 Key dates June 22, 2018 Temporary blackout period for the Ben E.