City of Eugene Deferred Compensation Program A Plan

City of Eugene Deferred Compensation Program A Plan for Your Future Use Page Up/Down, Return Key, or Arrow Keys to navigate. Press Esc to end the presentation.

What’s Deferred Comp? …and why should I care? ?

What is Deferred Comp? Voluntary Supplemental 457(b) Retirement Program All benefitted employees are eligible to participate (Regular, Limited Duration, RAE, IATSE) Easy contribution through Payroll Deduction Variety of investment options available

…and why should I care? ? Short answer: Deferred Compensation can help you live the life you want in retirement!

Deferred Comp Basics Through a convenient payroll deduction you can save for your future two different ways: q Pre-Tax Option ü Shelters your money from immediate taxes ü Taxes are paid on contributions and earnings at distribution q Post-Tax Roth Option ü Contributions are made after taxes ü Earnings are income-tax-free upon qualified distribution

Deferred Comp Basics Enrollment and Changes You can enroll, change contributions or stop contributing at any time Changes are effective in the month after the form is completed Withdrawals Normally only allowed if you have a severe, unanticipated financial emergency (per IRS) Allowed at termination of employment ü Pre-tax – no penalty for withdrawal under age 59 ½ ü Roth – must be at least 59 ½ with at least five years since initial contribution to withdraw without penalty

Deferred Comp Basics Maximum Annual Contribution The maximum amount that can be deferred is 100% of your salary or $18, 500 in 2018 (whichever is less) Additional catch-ups allowed if over age 50 or if within three years of normal retirement age Pre-tax Option and Roth Option have combined maximum annual contribution

What’s a Deferred Comp Benefit? Short answer: A Deferred Comp Benefit (DCB) is a City contribution to your Deferred Comp Account! Currently available for AFSCME-Represented, Non. Represented, and EPEA-Represented employees.

How Does the DCB Work? You contribute at least 1% of your gross base salary per pay period to either a Roth or Pre-tax Deferred Comp Account The City will contribute a percentage of your gross base salary to your Pre-Tax Deferred Comp Account (varies by bargaining unit) Ø Per IRS Rules, the City cannot contribute to a Roth account Both contributions count toward your annual Deferred Comp Maximum limit

DCB Contribution City contribution if you are deferring at least 1% of your base salary: ü Non-Represented Employees: The City will contribute a Deferred Comp Benefit of 3% of your base salary to your DC Account. ü AFSCME-Represented Employees: The City will contribute a Deferred Comp Benefit of 2% of your base salary to your DC Account. ü EPEA- Represented Employees: The City will contribute a Deferred Comp Benefit of 2. 75% of your base salary to your DC Account.

Can I Afford to Save 1%?

You Can’t Afford NOT To! Base Salary = $1, 500 per pay period 3% DCB Example Per Pay Period 1% Employee Contribution 3% City-paid Contribution Total Deferred Comp Contribution 2% DCB Example Per Pay Period 1% Employee Contribution 2% City-paid Contribution Total Deferred Comp Contribution 1% DCB Example $15 $45 $60 $15 $30 $45 Per Pay Period 1% Employee Contribution 1% City-paid Contribution Total Deferred Comp Contribution $15 $30 Per Year $390 $1, 170 $1, 560 Per Year $390 $780 $1, 170 Per Year $390 $780

For the cost of a cup of coffee… …you could have a more comfortable retirement!

The Beauty of Compound Interest Compound interest is when you earn interest on both the money you’ve saved and the interest you earn on your investment! For example, if you contribute $1, 170 each year to your deferred Comp Account you’ll have After 10 years $16, 058 After 20 years $45, 274 After 30 years $98, 430 Assumed 6% interest compounded monthly

Investment Choices? Portfolio Mix? HELP!

Target Date Retirement Funds You lead a busy life No time or inclination to focus on your retirement plan? Vanguard Target Date Retirement Funds let you leave the worry to someone else Simple way to invest throughout your career and into retirement A single Target Retirement Fund can serve as a complete, diversified retirement portfolio

How Target Retirement Funds Work Each Target Retirement Fund invests in several Vanguard funds, primarily low-cost index funds, to create a broadly diversified mix of stocks and bonds. The year in a Target Retirement Fund’s name is its target date, the approximate year in which you expect to retire Subject to the risks of its underlying funds. Returns are not guaranteed, and investing in one does not ensure that you will have enough income in retirement.

*Approximate allocation targets for each fund as of September 2016. As time passes, allocations for the date-specific funds will gradually shift their emphasis toward a more conservative allocation (from stocks to bonds) over time based on an assumed retirement age of 65.

Want to Pick Your Own Funds?

So What Do I Need to Do?

IT’S EASY! Enroll in Deferred Comp ü Enroll in Target Date Funds using EZ Enrollment, or ü Enroll by choosing your own funds with Voya, the City’s Deferred Comp Service Provider. Just call the local office at 541. 343. 6759 Increase your contribution ü Complete new DC Contribution Change Form Pat yourself on the back for planning for your future!

Want More Information? Employee Benefits Internet Website www. eugene-or. gov/employeebenefits Deferred Compensation Enrollment Forms Ø Roth Option FAQ Ø Dates & Times for Voya Consultations Ø Tools, Calculators and Videos Ø Info on the City’s DC Plans Ø Risk/Return Charts Ø And Lots More! Ø Employee Ø Benefits Staff 541. 682. 5062 or Benefits. Staff@ci. eugene. or. us