Kern County 457 Deferred Compensation Plan Important information about your Plan

Transcription

1 Plan. Save. Grow. Kern County 457 Deferred Compensation Plan Important information about your Plan

2 The Kern County Deferred Compensation Plan is Transitioning to Voya Financial Your future retirement depends on making sound saving decisions today. To help you plan and invest for your future, Kern County is excited to announce that Voya Financial, a leading recordkeeper of some of the largest government retirement plans in the United States, will be the new recordkeeper for the Kern County Deferred Compensation Plan. We look forward to offering you new services and reduced overall expenses to enhance your retirement planning experience. The transition to Voya will begin in a few weeks. This brochure provides some important information about the transition, so please read it carefully. Voya, Your New Recordkeeper Voya will take care of the daily servicing of your account, including account information, saving and investing education, transaction processing and more. Voya is grounded in a clear mission to make a secure financial future possible one person, one family and one institution at a time. To learn more about the specific product and services offered to the participants of the Kern County, California Deferred Compensation Plan, please visit KernCounty457.com and select Product Information in the Message Center for Voya s RetireFlex Mutual Fund Information Booklet. 02 I About the Transition Important Dates The transition from Empower Retirement to Voya will begin at 1:00 p.m. Pacific Time on September 8, 2017, and will be completed on September 20, 2017 at 6:00 a.m. Pacific Time. Please note that during the transition you will have limited access to your account see Plan Ahead for the Transition inside for details. August 14 Plan information available at your new retirement plan website, KernCounty457.com. August 23, 24 and 25 Group educational meetings take place. See page 7 for specific dates, times and locations. SEE PAGE 6 September 20 New account access with Voya at (800) or KernCounty457.com. New Customer Service Phone Number On September 20, 2017, you may access the Voya s Retirement Readiness Service Center at our toll-free information phone line at (800) Participant service representatives will be available Monday through Friday 5:00 a.m. - 6:00 p.m. Pacific Time (excluding stock market holidays). And don t forget Local service continues to be available at the Treasurer s Office and by calling (661) New Website Access On September 20, 2017, the transition to Voya will be completed. You can access your Plan account online via KernCounty457.com, conduct transactions, and access new features and services. Accessing Your New Voya Account After the transition to Voya is complete, you can register and access your account online through the Plan s website at KernCounty457.com or via the toll free Retirement Readiness Service Center at (800) Your default username will be your Social Security number without the dashes. Your default personal identification number (PIN) is the month and year of your birth (MMYY). You will be required to change your PIN on the website. You ll also be asked to provide responses to a set of security questions to help ensure the privacy of your account information. You will use your personal username and password for all future account access through the website and mobile app. If you access your account through the automated phone service, you will be able to continue using your default PIN or create one of your choosing. We strongly encourage you to change the default PIN to one of your own preference as soon as possible.

3 Plan Services As an advocate for greater retirement readiness, Voya looks forward to partnering with you on your journey to and through retirement. Through the County s new relationship with Voya, you will have access to many new features and services. LOWER PLAN ADMINISTRATION FEES! SEE PAGE 5 Core Investment Options The Kern County Deferred Compensation Advisory Committee has made only a few minor changes to the core investment options offered to you. This means less disruption to your account as a result of the transition. See the Mapping Table on page 4. Professional Advice for Every Level of Investor When it comes to investing, most of us could use some help. Investment Advice (Managed by You) and Managed Accounts (Managed by Morningstar) are two solutions that recognize you don t have to be an investing expert to do a good job managing your retirement account. Morningstar can help. You can choose to remain in control and implement advice right from the experts, or have an investment professional manage your account for you. Managed by You is offered at no additional cost, whereas Managed by Morningstar is a fee based service. 1 Go online for more information at KernCounty457.com. Currently using Empower Retirement Advisory Services? No worries. Your election will carry over automatically during the transition. Managed by Morningstar will review your investments upon receipt by Voya. With most investments remaining the same, it is unlikely you will see much - if any - immediate change as a result of the transition of this managed accounts service. Powerful Planning and Education Resources Mobile App When you re on the go, access your account and perform transactions anytime. Download the Voya Retire mobile app on your iphone or Android device from your preferred app store. 2 myorangemoney See your estimated monthly retirement income based on your current savings and other income sources, and track the progress you re making toward your retirement goals. By referencing your account balance and other information that you provide, myorangemoney, an educational, interactive online experience, can show you how your current savings translates into estimated monthly retirement income and whether you re on track to reach your goal. 1 IMPORTANT: The projections or other information generated by Morningstar Retirement Manager regarding the likelihood of various retirement income and/or investment outcomes are hypothetical in nature, do not reflect actual results (including investment results) and are not guarantees of future results. Results may vary with each use and over time. Morningstar Retirement Manager SM is offered by Morningstar, Inc. and is intended for citizens or legal residents of the United States or its territories. The investment advice delivered through Morningstar Retirement Manager is provided by Morningstar Investment Management LLC, a registered investment adviser and subsidiary of Morningstar, Inc. Morningstar Investment Managements advisory service relates solely to the investment options offered under the plan. Retirement plan funding products offered through Voya Financial Partners, LLC (member SIPC) or other broker dealers with which it has selling agreements. Voya Financial provides Morningstar Investment Management with the plan s investment options and information about participants but the decisions regarding the advice provided are made by Morningstar Investment Management. Voya and its companies are not affiliated with Morningstar Investment Management, LLC or its affiliates, and receive no fee or other direct financial benefits from Morningstar Investment Management in connection with the use of its services. The Morningstar name and logo are registered marks of Morningstar, Inc. 2 iphone and ipod touch are trademarks of Apple Inc., registered in the U.S. and other countries. Android is a trademark of Google Inc. I 03

4 Investment Options Automatic Transfer of Account Balances to Voya No action on your part is required. Your Plan account balance and future contribution allocations will transfer automatically. As indicated in the table below, most of the investments will remain the same. Balances and future contributions for the three investments indicated in red will transfer to new funds per below. Important Note: If you currently invest in the Great-West SecureFoundation Fund, this benefit will no longer be offered by the Plan. Assets will transfer to Voya and be invested in the Kern County Stable Value Fund. You may transfer this balance to other investments at any time following the transition. NET FUND Current Empower Retirement Fund MAPS TO FUND# TICKER New Voya Fund EXPENSE Stability of Principal Kern Stable Value Fund (Empower) 8920 n/a Kern Stable Value Fund 0.32% Great-West SecureFoundation Fund Other Fixed Income Harbor Bond - Institutional 8908 HABDX Harbor Bond - Institutional 0.51% Pioneer High Yield - Y 1450 TYHYX Pioneer High Yield - Y 0.87% PIMCO Foreign Bond (USD-Hedged) - I 8514 PFORX PIMCO Foreign Bond (USD-Hedged) - I 0.50% Asset Allocation Vanguard Wellesley Income - Admiral 2322 VWIAX Vanguard Wellesley Income - Admiral 0.15% Fidelity Asset Manager 50% 975 FASMX Fidelity Asset Manager 50% 0.66% Large Blend Vanguard Institutional Index Fund - Institutional Shares 566 VINIX Vanguard Institutional Index - I 0.04% Large Value JPMorgan Equity Income - R OIEJX JPMorgan Equity Income - R6 0.50% Large Growth Fidelity Contrafund 524 FCNTX Fidelity Contrafund 0.68% American Funds The Growth Fund of America - Class R RGAGX American Funds The Growth Fund of America - Class R % Mid-Cap Growth T. Rowe Price Mid-Cap Growth 477 RPMGX T. Rowe Price Mid-Cap Growth 0.77% Artisan Mid Cap Institutional 9806 APHMX Artisan Mid Cap Institutional 0.95% Mid-Cap Value JHancock Disciplined Value Mid Cap - R JVMRX JHancock Disciplined Value Mid Cap - R6 0.77% Fidelity Low-Priced Stock 1658 FLPSX Fidelity Low-Priced Stock 0.88% Small Blend Goldman Sachs Small Cap Value - Instl 1248 GSSIX Goldman Sachs Small Cap Value - Instl 0.97% Small Growth Janus Venture - N 9690 JVTNX Janus Venture - N 0.68% Specialty Morgan Stanley Inst US Real Estate - I 1148 MSUSX Morgan Stanley Inst US Real Estate - I 0.98% MFS Utilities - R MMUKX MFS Utilities - R6 0.64% Global/International Oakmark International - Investor 6958 IINCX Ivy International Core Equity - N 0.83% Artisan International - Institutional 6385 APHIX Artisan International - Institutional 0.95% American Funds New World - R RNWGX American Funds New World - R6 0.65% American Funds Capital World Growth & Income - R RWIGX American Funds Capital World Growth & Income - R % 04 I

5 Based on preliminary calculations, Voya expects the Kern Stable Value Fund net crediting rate to fall between a range of 3.00% and 3.50%. The actual net crediting rate will be announced closer to the conversion date in mid-september. Self-Directed Brokerage Account A self-directed brokerage account (SDBA) will continue to be offered through TD Ameritrade. If you currently invest in the SDBA, your current holdings will be transferred in kind to a new TD Ameritrade Account 1 that will be opened during the transition. TD Ameritrade will mail you a SDBA Welcome Kit containing contact information and account access details. Your personal identification number (PIN) will be mailed separately. Your TD Ameritrade SDBA will be available for access and trading on or shortly after September 20, You are encouraged to log in to the TD Ameritrade website, tdameritraderetirement.com, when you receive your Welcome Kit and PIN, so that you will be able to access your account just as soon as the assets are transferred. You will need your account number and PIN to access your account online for the first time; then you ll establish your own UserID and password to use going forward. If you have difficulty signing on, you can call TD Ameritrade Self-Directed Plan Services toll-free at The first time you log in, you ll be required to accept the terms of the TD Ameritrade Client Agreement. Once you do, you ll be able to conduct transactions online or by phone. To learn more about the SDBA, view the video at tdameritraderetirement.com/demo. The terms of the Plan s brokerage program are not changing. To learn more, including information regarding fees and expenses, visit KernCounty457.com. Lower Fees Minimizing expenses remains one of the objectives of Kern County s Deferred Compensation Advisory Committee. The transition to Voya will result in a reduction in fees being paid by most participants. Historically, fees have been charged for three services: 1. Plan administration 2. Investment management 3. Service specific fees (i.e., loans, etc.). A description of the fee structure follows. Plan Administration Fees The current total annual Plan administration fee, charged quarterly to all participants, is being reduced to 0.10% from the previous 0.15%. This fee is for recordkeeping and administrative services provided to the Plan by Voya and the County. There is no administrative fee on account balances of $350,000 or more (an increase from the current $150,000 limit). This fee is prorated and charged quarterly to your account. It appears as a line item on your quarterly account statement Investment Management Fees No Increase! The fees for the investment management of each investment offering will continue to be based on the amount of money you have invested in each investment. There is no increase in the investment management fees currently charged as a result of the transition to Voya. Please refer to the Mapping Table on page 4 for the investment management fees associated with each investment option. Fees for Optional, Voluntary Services Permissive plan features, such as loans, investment advice, etc., remain subject to fees. These fees vary by service and are either lower than current charges or remain unchanged. Refer to the Plan Highlights brochure at KernCounty457.com or contact the Treasurer s office to discuss. 1 TD Ameritrade is not affiliated with the Voya family of companies. I 05

6 Plan Ahead for the Transition The transition from Empower Retirement to Voya will begin on Friday, September 8, 2017, at 1:00 p.m. Pacific Time and will be completed on Wednesday, September 20, 2017, at 6:00 a.m. Pacific Time. During this transition period, also known as the Quiet Period, you will have limited account access so that records and accounts can be transferred to Voya. Please note: The Quiet Period for trading in the Self-Directed Brokerage Account will begin on Thursday, September 14, 2017 and remain in effect until the Plan transition completes at 6:00 a.m. Pacific Time, on Wednesday, September 20, All trades between the brokerage account and your core plan account must be submitted no later than Friday, September 8, 2017 at 1:00 p.m. Pacific Time. No action is required on your part. Accounts will remain invested throughout the Quiet Period. Your Plan balance in each current investment fund will be invested automatically as illustrated in the mapping table on page 4. Will I be charged as a result of the transition? No. Neither Voya, nor Empower Retirement, will charge your account for the transition activity. Regularly scheduled administrative and other existing fees (loans, brokerage accounts, etc.) will still apply at Empower Retirement. These are expected to be taken in advance of the transition and will be displayed on your final quarterly statement or other standard confirmation material. Is my money still invested during the conversion period? Most investments are not changing and will transfer in-kind to Voya. This means assets remain fully invested throughout the entire process. You will not be out of the market as a result of this activity. Two funds are exceptions to this process and will be out of the market for a brief period of time during the Quiet Period - the Great-West SecureFoundation Fund and the Oakmark International. The assets in these funds will remain with Empower Retirement until the liquidation date, anticipated to be Friday, September 15, On the transfer date, expected to be Monday, September 18, 2017, when assets are transferred to Voya, your money will be reinvested based on the mapping illustration on page 4. Assuming a transfer date of Monday, September 18, 2017 as expected, your balance in either of these funds will be out of the market for one business day. Making changes to your account before September 8? If you are planning to make account changes in the near future, such as transferring balances into different funds, changing your contribution rate, obtaining a loan, or requesting a withdrawal or distribution, these transactions must be completed before the cut-off dates noted in the table on page 7. Otherwise, the actions will have to wait until the transition to Voya is completed on September 20, I Special Information for Outstanding Loans and Installment Payments Outstanding Loans All outstanding loan repayment obligations under the Plan with Empower Retirement will automatically transition to Voya. There will be no change in the terms of your loan, including the repayment amount, interest rate or the remaining number of repayments owed. If you are retired or no longer working for the County and have an outstanding loan obligation, Voya will forward instructions to you in the coming weeks so that you can establish an electronic loan repayment directly from your checking or savings account. Installment Payments If you are receiving Installment Payments from Empower Retirement, those payments will continue through September 2017, though you may be paid earlier than normally scheduled to avoid the Quiet Period. Voya will begin processing all payments as of October 1, The specifics of your payment, including tax withholding and electronic banking information (as applicable), transfer automatically. No action by you is needed. Post-transition, all Installment Payments will default into the following schedule: Current Installment Payment Dates 1st through the 15th of each month 16th through the last day of the month New Payment Dates at Voya the 1st business day of each month the 16th or next business day of each month

7 Key Transition Dates Remember, no action is required on your part! Your current funds will transfer automatically to your new plan account with Voya. If you want to make changes to your account before the transition begins, you must complete your transactions before 1:00 p.m. Pacific Time on September 8, Transition support and local service is available through the Kern County Treasurer s office throughout the transition. AUGUST 14 Plan information available at a new website, KernCounty457.com END OF AUGUST Group educational meetings will take place on the following dates and times: Wednesday, August 23, 2017 at 9:00 a.m. and 12:00 p.m. Pacific Time Thursday, August 24, 2017 at 10:00 a.m. and 2:00 p.m. Pacific Time Friday, August 25, 2017 at 11:00 a.m. and 3:00 p.m. Pacific Time All meetings will be held in the following location: County Administration Building, Board of Supervisors Chambers, 1115 Truxtun Avenue, 1st floor, Bakersfield, CA For any questions, participants may call or DeferredComp@kerncounty.com. SEPTEMBER 8 Transition Quiet Period begins at 1:00 p.m. Pacific Time Inquiry only account access begins at Empower. No further transactions permitted including fund transfers, loans, withdrawals or distributions, account access, including the ability to make transactions. SEPTEMBER 14 Self-Directed Brokerage Account Temporary suspension of all trading activity begins at 1:00 p.m. Pacific Time All transfers between brokerage and core accounts must be completed by September 8, SEPTEMBER 20 Welcome to Voya! Transition Quiet Period ends at 6:00 a.m. Pacific Time Full access to accounts restored. Full access to Self-Directed Brokerage Accounts restored. All account transactions accessible through: Voya s Retirement Readiness Service Center: (800) Online account registration and access available via KernCounty457.com. Important Reminders Transactional account access will be restricted from September 8, 2017 at 1:00 p.m. Pacific Time until September 20, 2017 at 6:00 a.m. Pacific Time. If you are planning to make changes to your account in the near future, you must complete your transactions through Empower Retirement before September 8, 2017 at 1:00 p.m. Pacific Time. Beginning September 20, use your default Personal Identification Number, month and year of birth (MMYY), to register to access your account online, via the mobile app or by phone, all hosted by Voya. Transition Questions? If you have questions about how these changes will affect you, contact: KernCounty457.com information available 24/7. Participants may call or DeferredComp@kerncounty.com Never too Green! When you choose to go green and commit to reducing paper communications, you improve the future health of this planet, while uncluttering your world. When your account is accessible on September 20, please consider signing up for the secure, electronic delivery of all essential and required documents associated with your retirement savings program including transaction confirmation statements, regulatory documents and quarterly statements. While reducing the volume in your mailbox, these materials remain at your fingertips online 24x7. WEEK OF SEPTEMBER 25 Watch your mailbox. Confirmation of the transition will be sent directly to you by Voya. I 07

8 KernCounty457.com (661) (800) Search Voya Retire on your favorite app store Not FDIC/NCUA/NCUSIF Insured I Not a Deposit of a Bank/Credit Union I May Lose Value I Not Bank/Credit Union Guaranteed I Not Insured by Any Federal Government Agency You should consider the investment objectives, risks, and charges and expenses of mutual funds offered through a retirement plan carefully before investing. The fund prospectuses and information booklet containing this and other information can be obtained by contacting your local representative. Please read the information carefully before investing. Mutual funds under a custodial or trust account agreement are intended as long-term investments designed for retirement purposes. Account values fluctuate with market conditions, and when surrendered, the principal may be worth more or less than the original amount invested. A group fixed annuity is an insurance contract designed for investing for retirement purposes. The guarantee of the fixed account is based on the claims-paying ability of the issuing insurance company. Although it is possible to have guaranteed income for life with a fixed annuity, there is no assurance that this income will keep up with inflation. Money taken from the plan will be taxed as ordinary income in the year the money is distributed. An annuity does not provide any additional tax benefit, as tax deferral is provided by the Plan. Annuities may be subject to additional fees and expenses, to which other tax-deferred funding vehicles may not be subject. However, an annuity does offer other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you. Insurance products, annuities and retirement plan funding issued by Voya Retirement Insurance and Annuity Company ( VRIAC ), Windsor, CT. VRIAC is solely responsible for its own financial condition and contractual obligations. Plan administrative services provided by VRIAC. Securities distributed by Voya Financial Partners LLC (member SIPC) or third parties with which it has a selling agreement. Custodial account agreements or trust agreements are provided by Voya Institutional Trust Company. All companies are members of the Voya family of companies. All products and services may not be available in all states G.P 2017 Voya Services Company. All rights reserved. CN D