Retirement Plan Changes Update Overview Retirement Plan Options at - PDF document

Retirement Plan Changes Update

Overview Retirement Plan Options at W&M No changes to Defined Benefit Plans or VRS Hybrid Plan or 457 Deferred Compensation Plan 2

Plan Changes • Optional Retirement Plan Opt-Out • 403(b) Tax Deferred Savings and Cash Match Plans 3

Summary 1. Providing employees with additional investment choices in the ORP with TIAA and replacing a few of the funds currently offered through TIAA with new choices; 2. Replacing the Stable Value Galliard Fund on the Fidelity ORP platform with the New York Life Stable Value Anchor Account (no other Fidelity changes); 1. Changing the investment options that are available to employees in the 403(b) and Cash Match Provide Plans so that the investment choices with TIAA and Fidelity in these plans are the same as the investment choices in the ORP; and 1. Permitting employees hired prior to 1/1/2018 to select from investment options with both TIAA and Fidelity. 2. Employees hired after 1/1/2018 may only choose from the TIAA platform. However, they may invest in Fidelity funds through self-directed brokerage option. 4

Decision Making • Investment Committee : • Committee has been advised by CapTrust, a financial consulting advisory firm 5

Plan Improvements • Decision-making; W&M will manage ORP • Consistent plan design and administration of ORP and W&M retirement plans  Broader investment choices for ORP  Better oversight of 403(b) and Cash Match plans  Same investment choices in all plans • Lower participant fees • Lower administrative fees for the University • TIAA investment advisory services • New online retirement web platform for ORP and 403(b) and Cash Match plans 6

7 OPTIONAL RETIREMENT PLAN

Background - ORP Changes • GMU, Virginia Tech, University of Virginia and VCU previously opted out of the VRS optional retirement plan. • VRS advised the higher education community of planned changes to the ORP in late 2015. • Strong faculty opposition to VRS decision. • VRS reversed course, but W&M elected to continue to pursue opt-out status. 8

Status • Opt-out authorized by Board of Visitors at April 2016 meeting. • Filed opt-out application and received approval from VRS in June 2017. • Retained CapTrust to serve as plan fiduciary for ORP, 403(b), and Cash Match Plans. • Filed plan determination letter with IRS. • Retained TIAA-CREF as lead record keeper. • Selected new investment line-up for ORP, 403(b), and Cash Match plans effective 1/1/2018. • Employees advised of upcoming changes. 9

Changes to ORP • Investment choices – Fidelity lineup unchanged, except for change to stable value fund – TIAA selected as lead record keeper • Maintained TIAA annuities, TIAA Traditional, TIAA Real Estate and CREF Stock • 6 funds replaced with better performing funds • TIAA target date funds added • Added CREF Social Choice and TIAA Growth & Income • Four Vanguard index funds added for those seeking low cost investing • 10 actively managed funds added – Self directed brokerage option 10

Impact to ORP Accounts • TIAA will issue new contracts. • No change with Fidelity account setup. • Future contributions – Contributions into ORP don’t change, unless you are contributing to a discontinued fund. – Any changes that you wish to make to your investment choices beginning with your 1/16/2018 paycheck must be made no later than 1/15/18. • Discontinued funds – Future contributions mapped to replacement fund shown on next slide unless a change is made by 1/15/2018. – Existing balances in a discontinued fund are frozen to new contributions beginning with 1/16/2018 pay check. • Existing balances – Balances in a discontinued fund stay in place and are not moved, unless employee chooses to make a change and move balances. – Changes to existing balances can be made beginning on January 3, 2018. • 2/1/2018 - Retirement@Work web portal launches. • 2/1/2018 – Employees hired prior to 1/1/2018 may begin to choose from both TIAA and Fidelity platforms. • Employees hired after 1/1/2018 may only choose from TIAA platform, but they may invest in Fidelity funds through self-directed brokerage option. 11

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What is Not Changing • Employer ORP contribution amounts remain the same. • Employee eligibility cannot change unless legislature makes a change. • Statutory provisions of Virginia Code continue to apply to ORP. 14

15 403(b) and Cash Match Plans

Account Impact • Existing balances will be closed to new contributions beginning with the 1/16/2018 paycheck; account balances stay in place and will not be moved unless employee chooses to make a change. • Future contributions will be directed to the target date fund closest to the employee’s retirement age beginning with the 1/16/2018 paycheck. – If you do not wish new contributions to be directed into the target date fund, the employee must select new investment options. – Any changes that employees wish to make to their investment choices beginning with their 1/16/2018 paycheck can be made after 12/12/2017 but must be made before 1/15/2018. – Investment election changes for future contributions can be made at any time after 1/16/2018 for future payrolls. • Salary deferral changes (which is the amount that you contribute to the plan) cannot be made between 1/8/2018 and 1/15/2018. If you wish to change your salary deferral amount for the 1/16/2018 paycheck, you must do so prior to 1/8/2018. • Enrollment - Employees who do not participate but wish to enroll in the 403(b) or Cash Match plans for the 1/16/2018 paycheck must do so prior to December 15, 2017. Otherwise, you will not be able to enroll until Retirement@Work goes live on January 30, 2018. 16

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Next Steps • December – welcome packets mailed to employees. • Jan 1, 2018 – ORP assets transfer. • January 3, 2018 – New investment options become available. • Month of January – TIAA/Fidelity employee meetings across campus. Dates TBD. • Feb 1 st – new web platform goes live. 19

20 Retirement@Work Web Portal Sneak Peek

Starting Point for Employee Employee would start from W&M site and click on R@W. They would then register and be taken to the R@W landing page. TIAA CONFIDENTIAL. NOT FOR 21 DISTRIBUTION

Landing Page – Existing Employee To update elections, Employee first clicks this button TIAA CONFIDENTIAL. NOT FOR 22 DISTRIBUTION

Manage Contributions Employee can review current elections, then update by clicking this button TIAA CONFIDENTIAL. NOT FOR 23 DISTRIBUTION

Choose Your Contribution Amount Employee can keep or change the voluntary contribution amount TIAA CONFIDENTIAL. NOT FOR 24 DISTRIBUTION

Choose Your Investment Provider Employee can update the vendors across plans, or…(see next page) TIAA CONFIDENTIAL. NOT FOR 25 DISTRIBUTION

Choose Your Investment Providers Employee can update the vendors by plan and source TIAA CONFIDENTIAL. NOT FOR 26 DISTRIBUTION

Review and Confirm TIAA CONFIDENTIAL. NOT FOR 27 DISTRIBUTION

28 Questions? or • jmpoma@wm.edu • askhr@wm.edu