Due dates approaching to have Fidelity investment choices effective for January pay
Purdue's enhanced defined contribution and voluntary savings retirement plans go into effect Jan. 1. At that time, all future University and employee contributions to these retirement plans will be managed through Fidelity, the University's new recordkeeper.
To ensure that investment choices through Fidelity will be effective with the first pays of 2011, employees should enroll and make selections by these dates:
* Biweekly-paid employees: Jan. 3
* Monthly-paid employees: Jan. 20
To enroll, document beneficiaries and designate an investment choice, employees may visit the Purdue-dedicated Fidelity NetBenefits website at https://plan.fidelity.com/purdue or call 800-343-0860. The website is available around-the-clock, and phone assistance is available 8:30 a.m. to midnight Eastern time.
If an employee has not enrolled in a Fidelity account and made an investment choice from the funds in the new lineup by the time the employee receives the first pay in 2011, the employee's retirement contributions will be handled as follows:
* Contributions stop: Contributions to voluntary retirement savings, which many know as a tax-deferred annuity or TDA, will stop. To begin contributions again, employees will enroll through Fidelity and choose how to invest their contributions.
* Contributions default: The University's 10 percent contribution to the employee's retirement plan and the employee's mandatory 4 percent contribution will be invested into the Vanguard Target Retirement Date Fund based on the employee's age. To direct future contributions to a different investment option, employees will enroll through Fidelity and make a new investment selection.
Unlike other benefit elections, retirement investment choices can be changed at any time. In addition, employees may change their voluntary retirement savings plans whenever they choose.
"It is very important to note that, come January, employees will be managing their voluntary savings contributions themselves, either online or via the Fidelity phone center," says Teresa Wesner, benefits manager.
The current Salary Reduction Agreement forms will no longer be required. Purdue will continue to monitor contributions against Internal Revenue Service savings limits, but will not be processing the voluntary savings contributions. Fidelity will process all contributions.
"Prior salary reduction agreement instructions will no longer be valid in 2011 since a new process begins in January," says Wesner. "Employees who wish to start, stop or change their deferral amounts throughout the year will handle this directly through Fidelity."