City of Richmond, Virginia

Transcription

1 City of Richmond, Virginia NEWS RELEASE Philip R. Langham Executive Director August 1, 2012 Contact: Kristina Friar Marketing & Public Relations Specialist Phone: Important Plan Changes for City of Richmond Defined Contribution 401(a) Plan Members City of Richmond and RBHA employees with a Defined Contribution 401(a) Plan will see important plan changes take effect on September 14, These plan changes stem from an ongoing effort by the RRS and CAPTRUST Financial Advisors, an independent consulting firm, to evaluate the plan s fund offerings and develop a stronger investment lineup for participants. Evaluating each investment s performance, expenses, and management, CAPTRUST recommended 17 best in class fund options to enhance performance. While no action is required by participants, account holders have until close of business on Friday, September 14, 2012 to alter their asset allocation before affected funds are automatically transferred to the new fund lineup the following Monday. These proposed changes will not affect the plan s most popular investments, the VT Vantagepoint Milestone Series and VantageTrust PLUS Fund. The letter sent by ICMA-RC to all 401(a) plan participants is shown below. ### 900 East Broad Street * Room 400 * Richmond, VA Phone: * * Fax:

2 City of Richmond, Virginia RE: ADVANCE NOTICE OF PLAN SPONSOR DIRECTED FUND LINEUP CHANGE Dear Participant: July 2012 Earlier this year we partnered with CAPTRUST Financial Advisors, an independent consulting firm, to review the investment lineup for account holders with 401(a) qualified plans. As a result of this partnership, your investments may automatically transfer to new fund options after the close of business on September 14, Why the need for change? Because your investment decisions are an important part of growing your retirement income, CAPTRUST evaluated a broad range of investment options based on performance and recommended 17 best in class fund options for city of Richmond and RBHA employees with 401(a) qualified plan accounts. The new lineup removes underperforming fund options, reduces overlapping fund choices, and provides new investment options with overall expenses remaining the same or lower. These changes require no action on your part and greatly improve the plan s investment menu. No action is required The, CAPTRUST, and ICMA-RC are working together to smoothly transition from the old fund lineup to the new best in class fund lineup. There is no action required of you, and any affected funds will automatically transfer according to the attached table. For participants who do not want assets transferred as shown, changes can be made before market close (typically 4:00 p.m. EST) on September 14, Fund changes at a glance Please see the enclosed ICMA-RC notice for a summary of the changes being made to the plan s investment lineup. A good time to review your investment strategy These changes are an opportunity to review your portfolio and confirm that your account is properly allocated and diversified. Please visit our website, for additional information on your Defined Contribution 401(a) Plan or to learn more about the investment options available to you. Sincerely, Philip R. Langham Executive Director 900 East Broad Street * Room 400 * Richmond, VA Phone: * * Fax:

3 Advance Notice of Plan Sponsor Directed Fund Lineup Change Employer and plan name: The City of Richmond 401(a) Plan Scheduled implementation date: September 14, 2012 Summary of changes: The has directed ICMA-RC to implement the following changes to its 401(a) investment options. After close of business on the scheduled implementation date, your lineup will be changed as shown below and current fund balances and contribution allocations will be directed accordingly. If noted in italics, assets will be directed to the fund of the same name outside the VantageTrust. There is no action required of you; closing fund balances will be automatically moved to the replacement funds. If you have assets in the funds above and you do not want them transferred as shown, you must transfer the fund balances and change your allocations before market close (typically 4:00 pm Eastern) September 14, Note: After close of business on August 14, 2012, new investments in the VantageTrust CD Accounts1,3 will no longer be accepted. Assets invested in those accounts as of August 14, 2012 will allowed to mature and will be invested in the VantageTrust Cash Management Fund2 at maturity. The CD Accounts will be removed from the lineup after all mature assets have been transferred. Current Fund Lineup New Fund Lineup VantageTrust PLUS Fund 2 VantageTrust PLUS Fund 1 VantageTrust Cash Management 1,2 VantageTrust Cash Management 1,2 VT BoA MMDA (1 Year CD) 3 VT 1 Year BoA CD Account 3 VT BoA MMDA (3 Year CD) 3 VT 3 Year BoA CD Account 4 VT BoA MMDA (5 Year CD) 3 VT 5 Year BoA CD Account 3 VT Vantagepoint Core Bond Index 4 VT Vantagepoint Core Bond Index 4 VT PIMCO Total Return 4 è PIMCO Total Return 4 VT Vantagepoint Inflation Protected Securities 4 è PIMCO Total Return 4 VT PIMCO High Yield 4 è PIMCO Total Return 4 VT Vantagepoint Milestone Retirement Income 5 VT Vantagepoint Milestone Retirement Income 6 VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone VT Vantagepoint Milestone AC: ICMA Retirement Corporation 777 North Capitol Street, NE Washington, DC TEL: Fax: toll free: en español llame al: internet:

4 Current Fund Lineup New Fund Lineup VT Vantagepoint Model Portfolio Savings Oriented 5 è Age-appropriate VT Vantagepoint Milestone 5 VT Vantagepoint Model Portfolio Conservative Growth 5 è Age-appropriate VT Vantagepoint Milestone 5 VT Vantagepoint Model Portfolio Traditional Growth 5 è Age-appropriate VT Vantagepoint Milestone 5 VT Vantagepoint Model Portfolio Long-Term Growth 5 è Age-appropriate VT Vantagepoint Milestone 5 VT Vantagepoint Model Portfolio All-Equity Growth 5 è Age-appropriate VT Vantagepoint Milestone 5 VT Fidelity Puritan è Age-appropriate VT Vantagepoint Milestone 5 VT Vantagepoint Equity Income è BlackRock Equity Dividend VT Eaton Vance Large-Cap Value è BlackRock Equity Dividend VT Allianz NFJ Dividend Value è BlackRock Equity Dividend VT Vantagepoint 500 Stock Index VT Vantagepoint 500 Stock Index VT Vantagepoint Broad Market Index è VT Vantagepoint 500 Stock Index VT Vantagepoint Growth & Income è VT Vantagepoint 500 Stock Index VT Oppenheimer Main Street è VT Vantagepoint 500 Stock Index VT Vantagepoint Growth è Fidelity Contrafund VT Fidelity Contrafund è Fidelity Contrafund VT Calvert Equity Portfolio è VT Vantagepoint 500 Stock Index VT T Rowe Price Growth Stock è Fidelity Contrafund VT Vantagepoint Select Value 6 è Goldman Sachs Mid Cap Value 6 VT Goldman Sachs Mid Cap Value 6 è Goldman Sachs Mid Cap Value 6 VT Columbia Mid Cap Value 6 è Goldman Sachs Mid Cap Value 6 VT Vantagepoint Mid/Small Company Index 6 VT Vantagepoint Mid/Small Company Index 6 VT Vantagepoint Aggressive Opportunities 6 è Columbia Acorn 6 VT Harbor Mid Cap Growth 6 è Columbia Acorn 6 VT Royce Premier 6 è Columbia Acorn 6 VT Rainier Small/Mid Cap Equity Portfolio 6 è Columbia Acorn 6 VT Vantagepoint Discovery 6 è 50% Victory Small Company Opportunity 6 VT Vantagepoint Discovery 6 è 50% Eagle Small Cap Growth 6 VT T Rowe Price Small Cap Value 6,7 è Victory Small Company Opportunity 6 VT Royce Value Plus 6 è Eagle Small Cap Growth 6 VT Nuveen Real Estate Securities 8 è Age-appropriate VT Vantagepoint Milestone 5 VT Vantagepoint International 9 è Harbor International 9 VT Vantagepoint Overseas Equity Index 9 VT Vantagepoint Overseas Equity Index 9 VT Fidelity Diversified International 9 ** è American Funds EuroPacific Growth 9 VT Harbor International 9 è Harbor International 9 VT Retirement IncomeAdvantage 10 VT Retirement IncomeAdvantage 10 **The VT Fidelity Diversified International Fund 10 is subject to a 1% redemption fee on assets held less than 30 days. To avoid this fee the fund closure and replacement may be implemented according to the following schedule. See target implementation dates below. August 14, 2012: close VT Fidelity Diversified International to new monies August 14, 2012: direct incoming assets previously allocated to VT Fidelity Diversified International to the replacement fund Allow the existing VT Fidelity Diversified International assets to age 30 days, then September 14, 2012: transfer the aged VT Fidelity Diversified International assets as shown above and permanently close the old fund. Information on your new replacement funds is enclosed. If you have any questions please visit our website at and select any of the Contact Us options for Investor Services.

5 Disclosures Please read the current applicable prospectus and Making Sound Investment Decisions: A Retirement Investment Guide carefully for a complete summary of all fees, expenses, charges, financial highlights, investment objectives, risks and performance information. Investors should carefully consider the Fund s investment objectives, risks, charges and expenses before investing or sending money. The prospectus contains this and other information about the investment company. For a current prospectus, contact ICMA-RC by calling or by visiting All Vantagepoint Funds invested through 401 or 457 plans are held through VantageTrust. The Vantagepoint Funds are distributed by ICMA-RC Services LLC, a wholly owned broker-dealer subsidiary of ICMA-RC and member FINRA/SIPC. All funds are monitored for frequent trading. These fees and controls are designed to discourage frequent trading activities that increase costs to the fund and investors. Please refer to the fund prospectuses for guidance on redemption fee and frequent trading terms. Also, refer to ICMA-RC s Frequent Trading Policy for more information. 1 Direct transfers from the PLUS Fund to competing funds are restricted. Competing funds include, but are not limited to the following types of investment options: (1) cash funds (like the VT Cash Management Fund), money market mutual funds, bank accounts or certificates of deposit (such as the VT CD Account option), stable value funds or substantially similar investment options that offer guarantees of principal or income, such as guaranteed annuity contracts or similar arrangements with financial institutions; (2) short-term bond funds that invest in fixed income securities and seek to maintain or have an average portfolio duration of less than three years; (3) any investment option that invests 80% or more of its assets in (i) fixed income securities or funds with a duration of less than three years, or (ii) instruments that seek to provide capital preservation such as stable value funds, bank certificates of deposit or bank accounts, and cash or cash equivalents; and (4) a self-directed brokerage account. To transfer money from the PLUS Fund to a competing fund, you must first transfer the amount to a noncompeting fund for a period of at least 90 days. For example, if you want to transfer money from the PLUS Fund to the VT Cash Management Fund, you will first need to transfer the money to a non-competing fund and then, 90 days later or any time thereafter, transfer that amount of money to the VT Cash Management Fund. 2 The Cash Management Fund is invested in a single registered mutual fund, the Dreyfus Cash Management Fund. Investments in the VantageTrust Cash Management Fund are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Dreyfus Cash Management Fund seeks to preserve the value of the fund at $1.00 per share, it is possible to lose money by investing in the Fund. The 7-Day Yield more closely reflects the Fund s current earnings than the quotation of total return.

6 3 ICMA-RC and/or an affiliate of ICMA-RC receives compensation for services rendered by ICMA-RC to plans and participants. This compensation is 0.60% per year and may be used for any of the following services: Advertising and marketing costs Additional distribution support Educational seminars and training Shareholder record-keeping and/or transfer agency services CD Account interest rates are fixed during the term of the CD Account. FDIC coverage is reduced by any retirement account balances held directly with Bank of America, N.A. MMDA interest rates can vary daily during the open investment window. Please note that early withdrawal penalties apply to emergency and hardship withdrawals. For more information regarding CD Accounts, please contact Investor Services at A rise/fall in the interest rates can have a significant impact on bond prices and the NAV (net asset value) of the fund. Funds that invest in bonds can lose their value as interest rates rise and an investor can lose principal. 5 The fund is not a complete solution for all of your retirement savings needs. An investment in the fund includes the risk of loss, including near, at or after the target date of the fund. There is no guarantee that the fund will provide adequate income at and through an investor s retirement. Selecting the fund does not guarantee that you will have adequate savings for retirement. 6 Funds that invest in small and/or mid-sized company stocks typically involve greater risks, particularly in the short-term, than those investing in large, more established companies. 7 T. Rowe Price is a registered trademark of T. Rowe Price Group, Inc. all rights reserved. 8 Funds that concentrate investments in one industry may involve greater risks than more diversified funds, including greater potential for volatility. 9 Foreign investments are subject to more risks not associated with domestic investments (i.e. currency, economy and political risks.) 10 Prudential Retirement Insurance and Annuity Company (Prudential), CA COA #08003, Hartford, CT. Neither Prudential nor ICMA-RC guarantees the investment performance or return on contributions to Prudential s Separate Account. You should carefully consider the objectives, risks, charges, expenses and underlying guarantee features before purchasing this product. Prudential may increase the Guarantee Fee in the future, from 1.00% up to a maximum of 1.50%. Like all variable investments, this Fund may lose value. Availability and terms may vary by jurisdiction; subject to regulatory approvals. Annuity contracts contain exclusions, limitations, reductions of benefits and terms for keeping them in force. Guarantees are based on Prudential s claims-paying ability. This annuity is issued under Contract form # GA-2020-TGWB RC. ICMA-RC provides recordkeeping services to your Plan and is the investment manager of the underlying Prudential Separate Account. Prudential or its affiliates may compensate ICMARC for providing these and related administrative services in connection with the Fund. Before electing the Spousal Benefit (if available) on behalf of any beneficiary not recognized as your spouse under Federal law, be aware that provisions of your plan or the Internal Revenue Code might prevent, limit or otherwise affect the ability of the beneficiary to receive the Spousal Benefit. Variable annuities are suitable for long-term investing, particularly retirement savings. Prudential, the Prudential logo, and the Rock symbol are service marks of the Prudential Insurance Company of America, Newark, NJ, and its related entities, registered in many jurisdictions worldwide. Note: Participants who are interested in the VantageTrust Retirement IncomeAdvantage Fund must first receive and read the VantageTrust Retirement IncomeAdvantage Fund Important Considerations document before investing.