ICMA RC 457 Plan Overview and Investment Information

The ICMA RC 457 plan is a type of deferred compensation plan designed for government employees. It's a great way for them to save for retirement.

The plan is sponsored by the International City/County Management Association Retirement Corporation (ICMA-RC), a non-profit organization that specializes in providing retirement plans for public sector employees. They have been in business since 1972.

The ICMA RC 457 plan is a flexible and customizable plan that allows participants to choose from a range of investment options. These options include a stable value fund, a bond ladder fund, and a series of equity funds.

Investments in the ICMA RC 457 plan are managed by ICMA-RC's experienced investment team, who have a proven track record of delivering strong returns.

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A 457 plan is a retirement plan that allows public employees to set aside money for retirement from every paycheck.

You can defer compensation into the plan on a before-tax basis or after-tax (ROTH) basis, giving you more flexibility in how you save for retirement.

A 457 plan is specifically designed for public employees, providing a valuable benefit for those who work in the public sector.

By setting aside money from every paycheck, you can build a significant nest egg over time, helping you achieve your long-term retirement goals.

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The Mission Square 457 Deferred Compensation Plan offers a generous contribution limit. You can contribute up to $23,500 per year if you're under 50, or $31,000 if you're 50 or older.

The plan also allows for contributions on both a before-tax and after-tax basis. This can be a great way to reduce your tax liability and grow your retirement savings over time.

Required minimum distributions (RMDs) must be taken from the plan at age 72, unless you turn 73 after December 31, 2022, in which case you'll need to take RMDs at age 73.

To help you make the most of the plan, Mission Square offers financial guidance from their Retirement Certified Financial Planner professionals on staff.

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You can participate in the Mission Square Deferred Compensation Plan on a before-tax or after-tax basis, with contribution limits varying based on age: $23,500 if under 50, and $31,000 if 50 or older.

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Mission Square's financial guidance services are a valuable resource, offering access to Retirement Certified Financial Planner professionals and weekly webinars through their website.

To create or log into your account, view your current status, make changes, or enroll, use the Mission Square portal at www.missionsq.org.

The plan's financial wellness center is a great tool, providing interactive guidance to help you make the most of your retirement savings.

Required minimum distributions from the plan occur at age 72, or 73 if you reach age 72 after December 31, 2022, as per IRS regulation.

Here are the contribution limits for the Mission Square Deferred Compensation Plan:

Information Sessions will be held across the City from October 23 to November 8 to provide information on the change to the 457 Plan investment funds.

These sessions will offer a short presentation and the opportunity to ask questions, providing a chance to understand the changes and their impact.

The Finance Department's Pension Administration team will lead the sessions, ensuring that all questions are answered and concerns are addressed.

A schedule of information sessions is available, and it's a good idea to mark your calendar to attend one that suits you.

Here is a list of the information sessions:

The investment options in the 457 Plan are changing to lower fees and simplify the investment lineup. ICMA-RC will start the transition on November 15 at 5:00 p.m. and complete it by 8:00 a.m. on November 18.

During this time, participants' money will be moved to similar funds in the new investment platform. The VT PLUS Fund will be retained and remain available for investment.

The change to the 457 Plan investment funds won't affect the investment funds for the Payroll Deduct Roth IRA.

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The 457 Plan's investment funds are changing to lower fees and simplify the investment line-up. This change will be implemented by ICMA-RC between November 15 and November 18.

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During the transition, participants' money will be moved to similar funds in the new investment funds platform. No changes will be made to the VT PLUS Fund, which will continue to be available for investment.

The change to the 457 Plan investment funds should cause little disruption to employees and their 457 accounts.

ICMA-RC charges participants bundled fees to cover costs for the investment fund managers and for them, ICMA-RC, as the administrator. These fees are a percentage of the account balance.

The previous fee structure deducted fees out of earnings prior to allocation, making it hard for participants to be aware of the percentage-based fees. This has changed.

The new fee structure includes a percentage-based fee for investment fund managers plus a flat administrative fee for ICMA-RC. The annual administrative fee is $73.00, subtracted from accounts on a quarterly basis.

The administrative fee will appear on future quarterly statements, and over the long term, most participants will find the administrative costs to be lower.

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