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457(b) Retirement Savings Plan
Frequently Asked
Questions
1. Who is
eligible?
Eligibility
is determined by your District, so please contact JEM or
your District Benefits Office to find out who is eligible
under your District’s Plan.
2.
What is
the ESC Region 10 457(b) Retirement Savings Plan?
ESC Region 10
Cooperative is a 457
Deferred Compensation Plan and is a tax–deferred
supplemental retirement Plan sponsored by Education Service
Center (ESC) Region 10 and your participating District. The
Plan is authorized by the Internal Revenue Code (IRC)
Section 457(b) and is subject to specific Internal Revenue
Service laws and requirements. The Plan allows employees to
voluntarily contribute a portion of their compensation on a
pre-tax basis. The amount invested plus earnings is not
taxable until withdrawn from the Plan.
3.
How is the ESC Region 10 457(b) Retirement Savings Plan provided to
participants?
ESC
Region 10 and your participating District contract with
JEM Resource Partners (JEM) and AST Capital Trust to
provide administrative, investment and communication
services to participants. JEM is the main contact for
participants. You can find out how to contact JEM by choosing "Contact Us" from the menu.
4.
How does the Plan work?
You elect the
amount you wish to defer from your gross salary each pay
period. The amount you elect to defer is withheld from your
paycheck each pay period before taxes.
5.
Who contributes?
You. There
are no employer contributions under this Plan.
6.
How do I enroll?
You may join the Plan at any time by choosing 'Login' on
the left-hand menu and clicking "New to the system? Enroll Now!".
You will need your Social Security Number and the plan password
provided on the Summary Plan Description for your district. The
Summary Plan Description can be found on our website by choosing
'Plan Description' from the left-hand menu.
7.
What is the
contribution amount?
You decide
the amount that you want to contribute. Please keep in mind
that there are limits imposed under the Internal Revenue
Code. The maximum amount you can contribute during each
calendar year is up to 100% of your includable compensation
or the maximum listed in the table below, whichever is less.
Maximum
Yearly Contribution
|
Year
|
Maximum
|
|
2005 |
$14,000 |
|
2006 |
$15,000 |
|
2007-10 |
TBD-Indexed to
inflation in $500 increments. |
During one of
the three calendar years prior to your Normal Retirement
Age* you may utilize the Standard Catch-up provision by
making additional contributions to the Plan of up to twice
the regular deferral limit.
Maximum
Yearly Contribution
Utilizing Standard Catch-up
|
Year
|
Maximum
|
|
2005 |
$28,000 |
|
2006 |
$30,000 |
|
2007-10 |
TBD-Indexed to
inflation in $500 increments. |
If you are
age 50 or older you may utilize the Age 50+ Catch-up
provision by making additional contributions to the Plan.
During any year in which you are utilizing the Standard
Catch-up provision you may not utilize the Age 50+ Catch-up
provision. The additional contribution amounts are listed in
the table below:
Additional
Yearly Contribution
Utilizing Age 50+ Catch-up
|
Year
|
Maximum
|
|
2005 |
$4,000 |
|
2006 |
$5,000 |
| 2007-10 |
TBD-Indexed to
inflation in $500 increments. |
Before
utilizing the Standard Catch-up and Age 50+ Catch-up
please consult your tax advisor.
*The
term “Normal Retirement Age” shall mean the range of
ages from the earliest age at which the Participant has
the right to retire and receive a retirement benefit,
under the Teachers Retirement System of Texas, without
actuarial or similar reduction because of retirement
through and including age 70½, as designated by the
Participant. Any Participant who works beyond age 70½
may designate a Normal Retirement Age greater than 70½
provided, however, that Normal Retirement Age may not be
later than the date or age at which the Participant
terminates employment with the Employer.
8.
How are my
Plan contributions invested?
You will have full access to your account
upon enrollment. You may choose your preferred allocation at the time of enrollment. A fully managed
portfolio is available at not extra cost. If you do not make an election your contributions will be
invested in a money market account.
To view the most recent investment option information
choose "Investments" from the left-hand menu.
9.
What are my
investment option choices?
To view the most recent investment option information
choose "Investments" from the menu.
If you are
managing your own account, you may select which funds to use.
There are additional tools online to assist
you in determining the appropriate investments and
allocations at www.tcginvestments.com.
10.
How do I
make investment option changes?
If you are
changing your investments for the first time, you can enroll by choosing 'Login'
on the left-hand menu and clicking "New to the system? Enroll Now!". You will
need your Social Security Number and the plan password provided on the Summary
Plan Description for your district. The Summary Plan Description can be found on
our website by choosing 'Plan Description' from the menu.
your investments for the first time by clicking the link
below:
If you have
already initiated changing your investments, you can make
future changes online by logging into
www.theretirementsolutiononline.com and accessing your account.
You can also access the login page directly by choosing "Login" form the menu.
The following transactions can be made online:
• Move all or a portion of your existing balances between investment options.
• Change how your future contributions are invested.
11.
How do I keep
track of my account?
You can check
your account balance on the website at
www.theretirementsolutiononline.com
or
you may call JEM toll free at 800-943-9179
12.
Are
there fees to the participants in the Plan?
TCG
Investment Advisory Services LP has been hired by ESC Region
10 as the investment advisor and fiduciary to the Plan and
receives an advisory fee of .45% of account assets annually.
JEM is the Trust Administrator and handles
the ongoing administration of the Plan for annual fees equal
to $18.50 per year and .25% of account assets. An additional
charge of $20.00 will be applied for stop-payment requests,
a $5.00 charge for a 1099-R reissue, and a $50.00 charge for
any 1099-R revisions.
13.
When can
I withdraw money from my account?
14.
What are my
distribution options?
-
Receive a
lump sum distribution (subject to ordinary income tax)
-
Rollover your account balance
-
Leave in
the Plan until a future date (but no later than age
70½ or retirement)
15.
What happens if I leave employment?
When am I required to withdraw my money?
The Internal
Revenue Code allows distribution of funds only upon
retirement, termination of service with the participating
employer, or attainment of age 70½. At the time you
terminate service you may:
-
Keep your
money invested in the Plan and if desired, continue to
manage your money within the offered investment options;
-
Withdraw
your money – subject to ordinary income tax; or
-
Roll your
money to an IRA or another eligible employer that
accepts rollovers.
16.
What if I need some of the funds while still working
for my employer?
The
Internal Revenue Code and the Plan contain three
provisions that allow withdrawal of funds while still
employed. These three provisions are limited and have strict requirements, which
must first be met. They are:
-
An
unforeseen emergency must be documented, meet the
Internal Revenue Code definitions and criteria, and be
approved by the Plan Administrator.
-
A “de
minimis” withdrawal – this provision allows a withdrawal
while employed if your balance is $5,000 or less, you
have not deferred for the last 24 months and have never
used this provision before.
-
Attainment of age 70½, but you must stop your
deferrals.
17.
What happens
to my money when I die?
Your
designated beneficiary(ies) will receive the full value of
your account. Your beneficiary(ies) must contact JEM to
apply for a distribution.
18.
Are loans
available under the Plan?
Yes,
loans are available. The minimum loan amount under the
Plan is $1,000 and the maximum loan amount is 50% of
your account value. Participants with account values
less then $2,000 are not eligible for loans. For further
information on loans, please contact JEM at
800-943-9179.
19.
How can I
change my salary reduction?
You can change
your salary reduction at any time online by logging on to your account.
20.
How can I stop my
salary reduction?
You can stop your
salary deferrals at any time online by logging on to your account.
You may begin contributing again to the Plan at any time online by logging on to your account
21.
How can I get more
information?
To get more
information about the Plan or enrolling in the Plan,
please
contact JEM at 800-943-9179,
or visit the other areas of this website.
Updated:
June 16, 2007 |
