9/4/2014. Agenda. Quiz Time. Quiz Money Matters What s New Let s Play. Benefits U Presented by: ICMA-RC

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1 Benefits U 2014 Presented by: ICMA-RC Agenda Quiz Money Matters What s New Let s Play 2 In a 2012 survey of plan participants, what percentage of state employees HAD NOT calculated their pension and/or social security benefits? a) 15% b) 30% c) 25% d) 50% 3 1

2 In a 2014 survey, what percentage of state of Missouri employees reported they DID NOT have an emergency fund (short-term savings) for unexpected expenses? a) 17% b) 33% c) 75% d) 40% 4 Also from the 2014 survey, what percentage of state of Missouri employees utilize a budget each and every month? a) 17% b) 28% c) 55% d) 62% 5 From the same 2014 survey, what percentage of state of Missouri employees are NOT TOO CONFIDENT or NOT AT ALL CONFIDENT about choosing a financial adviser? a) 22% b) 41% c) 55% d) 87% 6 2

3 What is. The possession of knowledge and understanding of financial matters? Financial Literacy 7 Money Matters MOSERS led workshops Deferred Compensation participated on investment information Sessions done by special requests via HR Increased participation Setting Goals Budgeting Managing Credit Investing Retirement Sources Refine Goals Protecting Assets Investing 8 What s New Beginning in 2015 Deferred Compensation will present a new session 2 hours long/ onsite Scheduled by special requests directly from your agency Data used will be specific to state of Missouri employees 9 3

4 Concept Rules of the Game Budgeting Be an Educated Buyer Investing Challenges Employees Road Map Simple financial education for the real game of life. 10 Let s Play What is DB vs. DC? Which one has MOSERS oversight Do they work together What in the world are all these letters FAP- MSEP QUIZ question Why must your employee understand income replacement? MSEP 2011 Plan value 11 MSEP 2011/2011 Tier MSEP 2011/2011 Tier Employee Age at Hire 33 Age at Retirement 61.5 Years of Service (48.45% income replacement) 28.5 Starting Salary $22,000 Ending Salary (2% annual COLA) $38,700 Total Contribution to MSEP 2011/2011 Tier (4% of salary) $33,400 or an avg. $98 a month MOSERS/MPERS Benefit value for 25 years in Retirement $468,750 (COLA not considered) Accumulating $468,750 in a DC Plan/IRA would require: Total contributions of $148,086 or $433 a month (or 19% of salary) assumes 7% return 4

5 Let s Play Budgeting Setting a goal RetiremenTrack Calculator Spend wisely Decisions at every turn Example- College vs. Retirement Investing Understanding Deferred Compensation Plan % vs. Flat Dollar Quiz question Fees- administration and expense ratio costs 13 Fee Example Road Map What will your road map look like? 15 5

6 A Little Planning Can Go A Long Way Help address financial concerns & meet financial goals Financial Topics Consider if 1. Snapshot Financial Plans Saving for retirement Need a quick retirement forecast 2. Goal-Specific Financial Plans* Retirement Planning Asset Allocation Education Insurance Major Purchase Need a more detailed analysis of one or two financial areas 3. Comprehensive Financial Plans* Retirement Planning Asset Allocation Education Insurance Net Worth/Cash Flow Estate Planning Financial situation is more complex Cost Free $175; free if balance is over $100,000 $450; free if balance is over $200,000 Results of financial data plan are reviewed over the phone with a salaried ICMA-RC CFP professional * Fee-based financial planning services are offered through ICMA-RC, a federally registered Investment Adviser. Please read all disclosure documents carefully prior to initiating any plan. ICMA-RC does not provide specific tax or legal advice and does not guarantee results. Resources Education Specialists Onsite Seminars One on One Consultations Local office in Jefferson City 3349 American Ave Ste. A M-F 8 a.m. to 5 p.m. Do you have a story to share 17 There s a difference between interest and commitment. When you re interested in doing something, you do it only when it s convenient. When you re committed to something, you accept no excuses, only results. -Kenneth Blanchard 18 6