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Retirement

Retirement Info Packet

What is Deferred Comp?
The purpose of a deferred compensation plan is to produce tax delays and/or tax savings on monies you set aside for retirement. You will have a choice between a standard deferred compensation herein called a 457 account or a 457 Roth account or you can even have both.

A standard 457 allows you to set aside a part of your salary and postpone paying taxes on that salary until after retirement. This may prove to be advantageous for two reasons:

It is likely that your income will be lower after retirement, and therefore, you may be in a lower tax bracket.
Pre-tax deposits allow you to accumulate more money over time than after-tax deposits.

A Roth 457 account is funded with salary that has already been taxed. This may prove to be advantageous for two reasons:

No taxes are due on withdrawals from the account taken during retirement.
The growth in the account is not taxable.

Deferred compensation was intended by congress to be a retirement plan as opposed to a short-term savings plan. Hence, your funds may not be withdrawn until you have separated service from your employer, suffered a qualified emergency, reached age 59 1/2 or you are eligible to secure a loan on part of your balance.

Am I eligible to participate?
Any permanent County/ARC employee or elected official may participate in a deferred compensation plan. Enrollment takes place provided that an agreement to defer compensation not yet earned is completed and turned in to payroll prior to the first day of the coverage month. This means that when opening a new account, your first paycheck deduction/deferred comp contribution will occur the calendar month following submission of your enrollment form/application.

How do I get enrolled in Deferred Compensation?
You simply contact your provider of choice. You have four providers to choose from. You can ask your coworkers if they have a recommendation and you can consult the Deferred Compensation Provider Comparison document for assistance.

How much can I contribute to my 457 accounts each year?
A 457(b) plan’s annual contributions and other additions (excluding earnings) to a participant’s account cannot exceed the lesser of:

100% of the participant's includible compensation, or
the 457(b) elective deferral limit

Increases to the general annual contribution limit:

457(b) plans of state and local governments may allow catch-up contributions for participants who are aged 50 or older.
Special 457(b) catch-up contributions allow a participant for 3 years prior to the normal retirement age (as specified in the plan) to contribute the lesser of:
- Twice the annual 457(b) limit , or
- The basic annual limit plus the amount of the basic limit not used in prior years (only allowed if not using age 50 or over catch-up contributions)

Can I move my 457 balance from one provider to another?
You can move your funds to or from MNDCP, Mission Square, Nationwide or Lincoln. You cannot move them to an external entity until you have separated employment or reached age 59 1/2. Contact the provider you wish to move your funds to for assistance.

If I am already enrolled, when and how can I change my contribution amount?
You can change your amount year-round by submitting the appropriate form. If you wish to change your amount for ONE pay period ONLY use the One Time Deferral Form.

I have left employment and would like to begin withdrawals from my 457 account(s). What are the steps I need to take?
Follow the Withdrawing Funds Instructions.

How can I learn more about Deferred Compensation?
See the St. Louis County Deferred Comp Plan Document