Suffolk County Deferred Compensation Plan - Participant Credits
Following the January Deferred Compensation Board meeting, the Board instructed T. Rowe Price to issue another credit to Plan participants, based on excess revenue from 2018. On March 4th, 2019, credits were issued to participants and can be viewed under “Account Activity” after logging into your account on www.rps.troweprice.com or by using the TRP Personal Mobile App.
Where does this money come from?
When you invest in a mutual fund or common trust fund, a portion of that fund’s earnings is retained by the fund and used for their operating costs. This portion is known as a fund’s “expense ratio” or “investment management fee”. Funds with higher expense ratios often pay a portion of that money to the company that performs the record keeping (T. Rowe Price in this case). Based on our current contract with T. Rowe Price, all excess money received by T. Rowe Price, above their cost of record keeping our Plan, is to be returned to the Plan. The Board has chosen to return the portion of money that exceeds the cost of operating the Plan, back to Plan participants.
Those who have a higher amount of money invested in funds with higher expense ratios/investment fees will receive a higher portion of the excess revenue credit, as their investment in those funds generate a large portion of this revenue. Participants invested solely in trusts, such as the TRP Retirement Date Trusts or the Stable Value Common Trust Fund, will receive a smaller credit as the very low expense ratios on those funds do not generate much revenue. Participants should never choose an investment based on these revenue credits, as funds that do not generate excess revenue typically have lower expense ratios than those that do. For more information, please contact your Board Representative.
The new limit in 2019 was increased to $19,000 per year for normal contributions.
$25,000 for Age 50+ ($6000 over normal and no change in 2019)
$38,000 max per year in Catch Up
Catch Up for is up to 3 consecutive years based on your personal prior contributions
NOTE: You cannot do catch-up and the 50+ contribution in the same year.
Please contact Mike at the SOA office 654-0400 or via email firstname.lastname@example.org at for assistance with questions regarding catch up or when you plan on retiring as there are forms that need to be completed to maximize the amount you can tax defer.
For those planning catch up beginning in 2019, you should contact Mike to set up an appointment. You have time and this can be done in 2019 so long as the paperwork is completed prior to hitting the $19,000 normal limit. You will, however, need to change your bi-weekly contribution amount with T. Rowe Price, to reflect the additional funds that are needed to reach the allowable amount for 2019.
Paperwork needed by you for your appointment: NYS Retirement System Member Annual Statement. (See attachment below to see what this stetement looks like.) If you do not have it you can create an account online. You can use the link on the SOA website.
For those turning 50 in 2019, you should also be making a change to your bi-weekly amount to reflect the additional funds allowed to be contributed if you wish to avail yourself of the increase. No paperwork needs to be done to make these contributions.
If you are not in the deferred Compensation plan please contact Mike with any questions you have about this. It is a great program to shelter money and has numerous fund options.
401a – From SCAT Check for Retirees
The 2019 contribution has increased $1000 and is now at $56,000 maximum.
Please click the below attachment to view the 401a welcome letter that members will receive for the 401a plan upon retirement.
This is a sample letter-your actual letter may be slightly different as changes occur.
The 2019 limit is $56,000.
The BENCOR website link is available on our LINKS page.