December 2013 DC Update
Adding It Up: Give Yourself the Gift of Retirement Savings
The beauty of the deferred compensation plan is that you can pay yourself first with automatic payroll deductions, but are you being a Scrooge with your own retirement savings this holiday season? In this month's edition of Adding It Up, we'll discuss contribution amounts and how spoiling yourself today could make a big difference at retirement. Consider the popular $25 monthly contribution amount. For an average state of Missouri employee who works 23 years1, $25 a month equates to $14,577 in savings at retirement2.
Assuming that your retirement lasts 25 years, that $14,577 balance would only generate about $77 of income each month3.
Doubling your monthly contribution to $50 could give you a balance of $29,810 over that 23-year working career2. In that scenario, your income from the deferred compensation plan would be $157 per month for 25 years of retirement3. Finally, if you contributed $100 a month for 23 years, you could have $59,621 at retirement2. That would result in $314 of monthly retirement income over 25 years3. In other words, saving $75 more each month while you're working could result in $230 more in monthly retirement income.
If you're saving with the deferred compensation plan, then kudos to you, but before you splurge on extra holiday gifts, make sure you're filling your own stocking first. To adjust your contribution amount, log on to Account Access and navigate to the Contributions page under the My Account tab. You have until 3 pm on December 31 to submit contribution changes that will go into effect on January paychecks.
creasing contributions are obviously important, but it's also critical to understand the role your savings will play when you quit working to know if you’re saving enough. In next month's DC Update, we'll illustrate how your deferred compensation plan savings work alongside pension and social security benefits in retirement, and explore ways to estimate how much income you can expect from each source.
1 MOSERS' 2012 Member Profile Summary
2 Assumes a 6% annual rate of return.
3 Assumes a 4% annual rate of return throughout retirement and an account balance of $0 after 25 years.
Schedule an Onsite Visit with an Education Specialist
The new year is a great time for employees to review their financial situation. To that end, our education specialists are available to visit your agency for free one-on-one consultations. Visit the Education Specialists page on our website to see who covers your region or agency and then send them a note or give them a call to set up an onsite visit. As a reminder, you can also register for seminars covering topics like building a portfolio, participating in the Roth 457, utilizing target date funds, and investing for retirement, to name a few. Visit www.modeferredcomp.org and click on the Register for a Seminar button at the top of the page to see what's in your area and to register for that event.
1099-R Tax Form Information
If you withdrew money from your deferred compensation plan account in 2013, you must report that distribution on your 2013 tax return using the 1099-R tax form. This form will be available within Account Access the second to last week of January 2014. You will find the form under the My Account tab, on the View Transaction History page, within the Statements & Confirms section. Per IRS requirements, the forms will also be mailed no later than January 31, 2014.
Auto Enrollment Statistics
The table below displays cumulative auto enrollment participation statistics by department as of November 1, 2013.
Please note: Detailed data for agencies with 10 or fewer hires is omitted in this report.
| Department |
Total AE | Opt out | Net AE | Automatic Enrollment Success Rate |
| State Auditor | 11 | 0 | 11 | 100% |
| Dept. of Corrections | 1369 | 98 | 1271 | 92.8% |
| Office of Administration | 113 | 9 |
104 |
92% |
| Dept. of Conservation | 43 | 4 | 39 | 90.7% |
| Dept. of Revenue | 165 | 16 | 149 | 90.3% |
| Dept. of Health & Senior Services | 172 |
18 |
154 | 89.5% |
| Dept. of Elem & Sec Ed | 162 | 17 | 145 | 89.5% |
| Dept. of Social Services | 990 | 105 | 885 | 89.4% |
| Public Safety | 614 |
71 |
543 |
88.4% |
| Dept. of Transportation | 371 | 46 | 325 | 87.6% |
| Dept. of Ins, Fin Inst., Prof Reg. | 43 | 6 | 37 | 86.0% |
| Judiciary | 377 | 55 | 322 | 85.4% |
| Dept. of Agriculture | 25 | 4 | 21 | 84.0% |
| Dept. of Mental Health | 1214 | 199 | 1015 | 83.6% |
| Dept. of Natural Resources | 88 | 15 | 73 | 83.0% |
| Dept. of Labor & Industrial Relations | 41 | 7 | 34 | 82.9% |
| Attorney General | 58 | 10 | 48 |
82.8% |
| Secretary of State | 27 | 5 | 22 |
81.5% |
| State Public Defender | 95 | 21 | 74 | 77.9% |
| Legislature | 100 |
27 |
73 |
73.0% |
| Dept. of Econ Development | 37 | 11 |
26 |
70.3% |
| Dept. of Higher Education | -- | -- | -- | -- |
| Governor's Office | -- | -- | -- | -- |
| Highway & Highway Patrol | -- | -- | -- | -- |
| Lt. Governor | -- | -- | -- | -- |
| Missouri Consolidated Healthcare | -- | -- | -- | -- |
| MO Housing Development Commission | -- | -- | -- | -- |
| MOSERS | -- | -- | -- | -- |
| State Treasurer | -- | -- | -- | -- |
| Totals | 6146 |
748 | 5398 |
87.8% |
Happy Holidays
From everyone at the deferred compensation plan, we’d like to wish you a safe and happy holiday season. We hope your 2014 is filled with good fortune and happiness.
Stay Connected
You can find the State of Missouri Deferred Compensation Plan on Facebook, Twitter and YouTube. Whichever you prefer, staying connected with the Plan is a great way to receive timely plan news, valuable savings tips and more.