FCPS employee retirement plan question
![[Post New]](/jforum/templates/default/images/icon_minipost_new.gif){kind=icon}
Anonymous
|
I'm a newly-hired FCPS administrative employee and I'm a bit overwhelmed with the information about the retirement plans.
I see several options such as 403(b), 457(b) and VRS Hybrid 457. However I see FCPS only matches contributions to VRS and does not match any contribution to 403(b) or 457(b). Is this true? And if yes, why would I pick 403(b) over VRS Hybrid 457? |
Anonymous
You want to do the match with the VRS 457 hybrid as FCPS pays a parrtial match for you. No reason to leave that money on the table. In adittion, you can set up 403B and/or 457b plans on your own with a monthly payroll deduction. The benefit there is the money you put in is pre-tax so it will cost less in your net than what you contribute. Best to get advice from a real financialplanner, but if you can afford to put in even a little early, the money willl grow tax free until retirement; when you retire you will then be taxed on what you withdraw as you withdraw. The earlier you start the more it will grow. I know teacher salaries arent huge, but if you could put in $50 or $100 bucks a month when you are just starting (assuming you are young) the growth will be significant. If you start at 22 putting in money and stop contributing 10 years later, in the end you will likely have a lot more in the account than if you wait until 32 and then pay that amount for the rest of your career. The compounding of earnings early will payoff in the end. |
Anonymous
|
Thank you very much for your reply.
So as a simple example, suppose I can afford to put $100/month to retirement plan. Which of those plans should I put it in? Put everything into VRS457 and take advantage of the FCPS match? Or split between 403b and/or 457b to take advantage of the tax deduction? (not sure if VRS457 is also tax free) |
Anonymous
Yes, whatever you put into the VRS457 is pretax as well and you shoudl put it there becasue that is what FCPS matches the 1st 1% of what you put in and the .5% for every percent you put in. It can get confusing, so I did a cut and paste from the FCPS page that explains it. "Most instructional/school-based staff hired after January 1, 2014 are members of the VRS Hybrid Retirement Plan. Hybrid members are given the opportunity to receive partial matching contributions to the defined contribution component of their retirement account. The first 1% of voluntary contributions will be matched with a 1% contribution by FCPS. Each additional 0.5% member contribution will be matched by FCPS with a 0.25% contribution. The maximum matching contribution is 2.5%." These percentages are of your gross pay (so come tax return time they don't count so your taxes woudl be less). So to get the maximum amount of pay in from FCPS you would put in 4% of your gross pay and FCPS would add 2.5% of your gross pay to that for your VRS457. Again, that 4% would be pre-tax so it does not cut 4% of your take home. It sounds like a lot, but essentially you get to invest 6.5% of your pay for the price of 4%. This lnk to the vrs/hyprid page is helpful (there is a lot there, but there is also a contact # 85-291-2285 where you could get some help - prepare to be on hold though). https://www.varetirement.org/hybrid/contact-us.html. By the way, if after you see a paycheck or two and think you cannot afford that mych, you can change the amount at anytime. As for the other 403b/457b otions if you choose them down the road, you can simply invest a certain dollar amount rather than go off percentage of income, and there is no county match. It is still a good idea when you can afford to do so. There are three companies that FCPS has agreements with Empower Retirement, TIAA, and AIG Retirement Services. You can find their numbers on the FCPS [age https://www.fcps.edu/careers/retirement-benefits/defined-contribution-retirement-plans/403b-plan .Again, I know the pay is not great so you may not be able to add to these, but goood to get started as early as you can, if you can. TL;DR - Opt into the 457/VRS hypbrid and do so at 4% to get all the $ from FCPS you can. If you can afford more look at the other investment options, too. |
Anonymous
sorry for the typos... As a retired teacher I should proofread my work 
|
Anonymous
|
Thank you so much for taking the time to explain all this!
|
Anonymous
| You're welcome and best to you in your new role! |
Anonymous
| Ask if your workplace has a retirement ambassador. I'm training to be a workplace ambassador. Someone at your school might be able to connect you with someone already trained. |
Anonymous
Snort. At FCPS? No. |
Anonymous
Yes. Sign up in MyPDE for training. My workplace has 2 ambassadors. |
Anonymous
Yes. Every school I've worked at in FCPS had a staff member who was trained to do this. |
Anonymous
+1 DW and I are both trained ERFC Ambassadors. |
Anonymous
|
I agree it’s overwhelming. FWIW, I want to max out my VRS contributions to get the match.
What is frustrating is I’ve been trying to register on VRS and make a new account and it keeps saying it’s unavailable and I haven’t had a minute in my day to call VRS to figure it out. |
Anonymous
OP here. Have the same problem, the system does not let me create an account even after I enter my personal data (last 4 of SSN, DOB etc.). I called their support and they redirected me to FCPS HR, who in turn told me that they will send the information to VRS after a full month paycheck (I was hired on Aug 11, so my August paycheck was partial). This is very unfortunate (and frustrating!) since the deadline to register for Q4 2021 is September 15.. So I guess I will have to miss the entire VRS457 quarter because of this? |
Anonymous
| I called VRS on Wednesday and got a message they were "experiences a high volume of calls" and the leave a message and espext a return call in 1-2 days. I called each day anyway and got the same message and left messages. No call yet. Yes, frustrating. |