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Summary of Plan Provisions What i s a Deferred Compensation Plan? 457(b) deferred compensation plans are available to local, state, and federal government and tax exempt organizations. They are termed “deferred compensa- tion” plans because they offer you the opportunity to “defer” or postpone some of your current compensa- tion and receive it, with earnings, in the future. Each pay period, your employer deposits your selected amount of deferred compensation into your ACCG Retirement Ser- vices 457(b) account which is then invested in funds se- lected by you. At separation from employment or retirement, your 457 funds, plus earnings, are available to you. When used for retirement, the tax liability may be much less because your overall income may be lower than when you were working. Local governments use these plans either as a primary or secondary type of retirement plan. When used as a pri- mary retirement plan, employers sometimes make contributions to the plan to supplement employee deferrals. However, such plans are often established as a secondary plan used to supplement other types of plans, and virtually all of the contributions into the plan come from employee deferrals. There are more local government employees participating in a 457(b) plan than any other type of retirement plan. Participating in your 457(b) deferred compensation plan is one of the best ways to build assets for use during your retirement years. Because all of the earnings grow tax-deferred, they increase in value much faster than if you were required to pay federal and state income taxes each year on those investment re- turns. Depending on whether your 457(b) plan is your primary or secondary plan, and in combination with your investment success, it can often provide retirement benefits up to 35% of your final, pre- retirement earnings. ---PAGE BREAK--- Am I eligible to participate, and if so, when can I enroll? Generally all full-time and part-time employees are eligible to participate in the Plan. You can enroll on the first pay period of any month under a 457(b) plan. Please be aware that once you complete the documentation necessary to begin participa- tion, it may take several pay periods for your contribution to be deducted from your pay and invested in your desired invest- ment choices. Contact either your Regional Client Manager or your payroll department to confirm eligibility and get started in the plan. How much can I contribute? Regular Contributions You can contribute 100% of your pay up to a maximum of $19,500 in 2020. Future years may be adjusted for inflation. Age 50 Catch-Up Contributions In the year you become age 50 and for all years thereafter, you can increase your contribution by a specified amount over and above the regular contribution limit. In 2020, the amount is an additional $6,500 maximum. Three Year Catch-Up Contributions If you are three years or less from retirement, you may be able to further increase your contributions by the three year catch-up contribution amount. This can only be used if you have not contributed the maximum amount in previous years. However, you cannot use it in combination with the age 50 catch-up contribution. Please contact your ACCG Retirement Services Regional Client Manager to help you determine if you are eligible to make a three year catch-up contribution and the maximum amount you may contribute. Employer Contributions Some employers have the 457(b) account as the employee’s primary retirement account and make contributions into the account. Both the employer and employee contributions added together must not be more than the IRS limits for the year. Contribution Example: Susan Jones is 49 on January 1, 2020. She plans to retire at a normal retirement age of 65. She wants to put as much as possible into her 457(b) account until she retires. ---PAGE BREAK--- How much can she put in annually? In 2020, she can put in the maximum regular contribution of $19,500. Ms. Jones will reach age 50 during 2020; therefore she would be eligible to begin making the age 50 catch-up contribution in addition to the Regular Contri- bution for a total of $ 26,000 in 2020. In 2021 and later, she can contribute at least $26,000 annually and may- be more in future years if the IRS increases the limits to keep up with inflation. Three years before retirement, at age 62, Ms. Jones can determine if she is eligible for the three year catch-up contribution. Assuming she has con- tributed the maximum since age 48, she will have to look at her contributions prior to age 48 to determine if she had previously contributed the maximum allowable amount and to calculate the previously unused contribution amount. How and when do I become vested in my account? “Vesting” refers to your “ownership” of the funds in your 457(b) account. From the moment money goes into your account, you are 100% vested in both the contributions and investment earnings. This applies even to contribu- tions your employer puts into your 457(b) account. Can I get money out when I am still working? Yes, but only under very limited circumstances such as a severe unforeseen financial emergency. Your 457(b) account is designed for your use after retirement. IRS sets guidelines for determining if you qualify for an unfore- seen emergency distribution. After I terminate employment, when can I withdraw money from my account? With a 457(b) Plan, unlike many other retirement plans, you have complete access to all of your money without an “early withdrawal” penalty. While ACCG Retirement Services would strongly encourage you to keep your money in some type of retirement plan, you can withdraw your funds at any time after termination, for any reason. Please remember that if you withdraw your money, you will be required to pay federal and state income taxes on it. Any money you withdraw will have a mandatory 20% deducted for federal income taxes but this may not be enough to pay your actual taxes. You have the option of: leaving your money in the ACCG Retirement Services 457(b) Plan to continue to grow; withdrawing all of your money in one lump sum; transferring or “rolling” your money to an IRA or other eligible retirement plan; receiving regular withdrawals for either a specified amount or a specified period of time. For a complete description of your withdrawal payment options, please contact your ACCG Retirement Services Regional Client Manager. If I die and I have money in my account, what will happen to it? Upon your death your account balance will be paid to your beneficiary (or beneficiaries if you specified more than one). We would strongly encourage any beneficiary entitled to receive money to contact your ACCG Retirement Services Regional Client Manager for a complete description of his or her options. How are my account funds protected? Your contributions and investment earnings are held in a trust at the Charles Schwab Bank exclusively for the benefit of all plan partici- pants. Your employer cannot gain access to your funds and no credi- tors can gain access to your funds. All transactions are permanently rec- orded in ACCG Retirement Services recordkeeping system and can be recalled at any time for review or discus- sion with you. *Your account balance is subject to market fluctuations. For a copy of the Plan document, please contact your employers Human Resources Department ---PAGE BREAK--- Frequently Asked Questions What costs or fees am I charged for my account? Your annual administrative fee amount will be capped once your account balance reaches $25,000; you will incur no additional administrative fees on an annual basis, regardless of how much your balance grows. You can potentially save on investment fees from your other retirement accounts by rolling over your balances into your ACCG Retirement Services 457(b) account. Each participant's plan expenses and fees are unique to them and it is based on the participant's aggregated account bal- ance(s). What investment options do I have? ACCG Retirement Services has a line up of 19 tax-deferred investments. Your employ- er may choose to include Target Date, Target Risk, Core Index, and Single Asset Op- tions. The funds are diversified to help you decide what savings method is best for you. Who selects and tracks the performance of investment options? As part of the turnkey plan administration solution offered by ACCG Retirement Ser- vices, the ACCG Defined Contribution Board of Trustees (the “DC Board”) assumes the fiduciary responsibility for the fund lineup it recommends to plan sponsors. The DC Board maintains an Investment Policy Statement which details the qualitative and quantitative criteria it uses to monitor and recommend the fund lineup. The DC Board meets quarterly to review the investment lineup and, as needed, adds, removes or replaces available investment options. How do I access my account? Account information can be accessed online at ACCGretirement.org. You will need to use the log in information provided to you once you have enrolled in the plan. Once you have accessed your account online you can: view investment performance and balances change or realign investment elections and fund balances view and download quarterly statements change your address, e-mail address and password How often can I change investment choices, and is there a charge each time I change? You can change investment choices or realign fund balances as often as you like. ACCG Retirement Services will not impose a charge. Some funds, however, may charge a redemption fee, so please review the information provided on-line. ACCG Retirement Services would encourage you to establish an asset allocation strategy and maintain it for a period of time. Will I receive a quarterly benefit statement? You will receive a comprehensive benefit statement as soon as possible after the close of each quarter. The statement shows your account balance, any contributions and earnings or losses credited to your account during the reporting period, and re- cent performance of each of the plan’s investment options. A more detailed state- ment is available online. Notify ACCG Retirement Services when you change your ad- dress so you are sure to receive your statement. ACCG Retirement Services is the retirement services division of ACCG, Georgia’s county association. More than 150 jurisdictions and local government employees in Georgia trust their retirement services needs to ACCG Retirement Services. ACCGretirement.org (770) 952-5225 (800) 736-7166 Who Can I Contact if I Have Questions On your ACCG Retire- ment Services quarterly statement, your local Regional Client Manager is listed with their phone number. If you want to contact the main office in Atlanta with questions other than investment guidance, please call ACCG Retirement Ser- vices Client Services at [PHONE REDACTED].