Retirement Monitor Update: January 19, 2005
We know you have come to rely on the Retirement Monitor to provide you with news and tips from the Retirement Systems Division to help you keep up with law and policy changes, among other updates. We also hope you pass some of the information included in the Monitor along to your employees. We appreciate the input you have offered us on this publication and we are glad you have found it helpful.
To make the Retirement Monitor more helpful and timely, we are going to change the format. Instead of sending a group of articles to you every few weeks, we will send smaller, more timely bits of information to you several times a month. The goal is to get you the information you need as soon as you need it. We hope this new format will meet that goal. An archive of all articles will still be available at www.nctreasurer.com/retirementmonitor.
As a reflection of this new format, we will change the name of the publication to the Retirement Monitor Update. Another change you may notice is the email address from which the email is distributed. Margaret Jordan, a skilled communications professional and state government veteran, has taken over as Communications Manager for the Retirement Systems Division for the next few months and will be the primary distribution point for all updates.
We hope you will find this new format beneficial. If not, please feel free to let us know and we will do our best to adjust our approach to meet your needs.
Thanks for your being great partners in service to members of North Carolina's public retirement systems. Your first Retirement Monitor Update is on its way!
Retirement Monitor Update:
$66 Million in Additional Earnings for Public Employees Due to NC 401(k) Plan Transition
The September 2003 transition of the NC 401(k) Plan from BB&T to Prudential Retirement has resulted in $66 million to date in additional earnings for the Plan's more than 180,000 members, according to figures released today at a quarterly meeting of the state Retirement Systems Board of Trustees. These earnings are a result of improved investment choices, lower fees and better asset allocation tools provided by the Plan's new administrator, Prudential Retirement
"This is an additional $66 million in retirement savings in the accounts of North Carolina's public servants, and it didn't cost the taxpayers a dime," said State Treasurer Richard Moore, who oversees the Plan's administration. "This is a prime example of how strong management of this plan is generating direct gains for our public employees."
The NC 401(k) Plan was established in 1985 as a supplemental retirement savings option for North Carolina's roughly 680,000 working and retired public employees. The Plan is now the largest public 401(k) plan in the country with approximately 180,000 members and more than $2.9 billion in assets. The Plan was administered by Branch Bank and Trust (BB&T) from 1985 to 2003, when Prudential Retirement was selected as the new administrator through a legally-mandated competitive bid process."The decision to transition the Plan from BB&T to Prudential Retirement was made based on the superior investment options, lower fees for participants and a commitment to increase staff dedicated to the Plan," said Retirement Systems Division Director Michael Williamson, who led the bid, selection and transition process. "The figures we saw today are proof that we made a sound decision in making this change and that our constituents are better for it."
Treasurer Moore has been a tireless advocate of lowering mutual fund fees and encouraging supplemental savings for public employees and all North Carolinians. He is the author of the nationally-recognized Mutual Fund Protection Principles, which call, in part, for public entities to closely monitor fees in defined contribution plans offered to employees and to aggressively pursue more competitive fee arrangements.
"We see the Mutual Fund Protection Principles in practice in these numbers today," said Moore.
Retirement Monitor Update:
General Retirement Training Sessions Scheduled for Human Resources and Benefits Professionals
The Employer Education Services Unit of the Department of State Treasurer is gearing up to conduct another round of training seminars for human resources and benefits professionals which will be held in locations across the state between early February and late April. This training seminar will be for human resources and benefits professionals and provide a "General Retirement" overview. We will cover topics such as Enrollment, Reporting of Contributions, Refunds, Service Purchases, Transferring between Systems, Retirement, Re-employment, etc.
All sessions will begin at 8:30 AM and should be over by 1:00 PM except the session at NCSU on March 11th which will begin at 12:30 PM and end at 5:00 PM.
Seating will be on a first-come, first-served basis. We encourage all Human Resource Directors, Benefit Administrators, and Payroll personnel to attend.
Directions or a map to the site you have selected will be sent via email approximately 3 business days prior to the scheduled date
Retirement Monitor Update: January 31, 2005
Employment in a Job Not Covered by Social Security
The Social Security Protection Act of 2004 requires state and local government employers to disclose the effect of the Windfall Elimination Provision and the Government Pension Offset to employees hired on or after January 1, 2005 in jobs NOT covered by Social Security.Those newly-hired employees must sign a statement stating they are aware of a possible reduction in their future Social Security benefits.
Effective January 1, 2005, employers who hire new employees not covered by Social Security will be required to download Form SSA-1945, Statement Concerning Your Employment in a Job Not Covered by Social Security, form www.socialsecurity.gov/form1945/SSA-1945.pdf.
Have the employee sign the form prior to the start of employment. Send a copy of the signed form (employer keeps the original) to the Retirement Systems Division.
Additional information is available from the Social Security website at www.socialsecurity.gov/form1945.