Transitioning to a New Service Provider The more things change, the more they stay the same Important details inside about Tandem’s move to a new record keeper and what it means for you as a current participant. Tandem Is Moving to Great-West Financial® for Plan Service Tandem, the State’s 457 savings plan for public employees, is getting a new partner. Starting in January, Great-West Financial® will begin providing our plan administration, record keeping and education. Your investment choices and other account information will move automatically to the new service provider. Keep in mind that you will still be in the Tandem 457 Plan. Your money is in Tandem and with its menu of investment options. You do not need to do anything if you are happy with your current portfolio makeup. We’ll just have someone else doing the record keeping and paperwork. Please note, as part of the transition, you will receive a statement with a $0 balance from ING/Voya. Don’t worry, this is just reflecting the transfer to Great-West Financial. See Page 6 for more information. The transition from ING/ Voya will begin at 3 p.m. CST on December 23, 2014, and will be completed on January 21, 2015. During this time you will not be able to make changes to your account. Please see “Plan Ahead for the Transition” for more info. This publication provides important information about the transition, so please take some time to read it carefully. Tandem’s new sidekick Great-West Financial has a solid track record and extensive experience with 457 plans like ours. Its strong credit rating, competitive fees and focus on retirement readiness will make it a great partner. You will also see Great-West Financial referred to as “EMPOWERTM Retirement.” Empower unites the retirement businesses of GreatWest Financial®, Great-West Financial Retirement Plan Services (formerly J.P. Morgan Retirement Plan Services), and Putnam Investments. See Page 6 Why Are We Changing Service Providers? KPERS oversees Tandem and has your best interest in mind. As part of our fiduciary commitment to you, we want to be sure you have quality investment options and tools at a good value to help you save for retirement. The current service provider contract expires in December, so we took this opportunity to revisit the market for competitive prices and services. After an extensive selection process, we selected Great-West Financial as the partner best suited to help Tandem become an even more effective source of retirement readiness for public employees. What to Expect During the Transition We’ll do everything we can to make this transition as simple and seamless as possible. Keep in mind the following: • You do not need to do anything with your investments. Everything will transfer automatically. But there will be a time when you cannot access your account (called the “blackout period”). See Page 6 for how to prepare. • We will hold informational group meetings across the State. This publication covers all of the transition information, but these meetings will give you a chance to ask questions in person if you’d like. You can find up-to-date meeting information at www.kpers.org/tandem.html. • Retiree payments will continue as scheduled. If you are receiving periodic payments from your Tandem account, you will receive a separate letter explaining how we will handle your payments during the transition. P21-888-275-5737 www.kpers.org/tandem.html Features and Services Retirement planning could be overwhelming ... but Tandem can help! Even superheroes have a sidekick. New website New advisory services Tandem is updating its website with the transition. You’ll see a clean, simple, smart design with tools and information to get you retirement ready. If you are a do-it-yourself investor, investment help is just a click or call away. New to Tandem, Reality Investing® Advisory Services (Advisory Services), available through Advised Assets Group, New account login LLC (AAG), a With Tandem’s new website, federally registered you’ll also have a new account login. Great-West Financial investment adviser, will mail you a Personal provides Guidance Identification Number (PIN)1 and Advice services and instructions the week that can help take of January 12, 2015. After the guesswork January 21, use it to activate out of investing. your new account login at These free tools www.tandem457.org.2 and services can provide a personalized retirement strategy for your portfolio that you implement and manage on your own. Everyone will be able to designate beneficiaries, update investment choices and choose electronic statement delivery, if that option works best for you. Completing paper forms with your Tandem representative is always available, too. There are also financial tools and calculators to help guide you through retirement planning and your saving decisions. There is no guarantee that participation in Advisory Services will result in a profit or that your account will outperform a self-managed portfolio. Real people for real help Custom calculator just for you Most Tandem savers are also KPERS members. To see the big picture for your retirement, you need to see all the pieces. And because of the partnership between Tandem and KPERS, we’re in tune with how the benefits fit together. We’ll have a calculator that estimates income amounts from your Tandem account, KPERS benefits and Social Security. You’ll even be able to try out early retirement scenarios as you explore your options. Tandem will continue to have dedicated education representatives throughout the State to help you understand your investment options and help you manage your account. You’ll see some familiar faces and have a chance to meet some new ones. Check out www.tandem457.org2 in January for a list of who’s available locally to help you with your account. 1-888-275-5737 www.kpers.org/tandem.html P3 Fee Transparency: What you see is what you get The KPERS Board of Trustees made a decision to change how Tandem’s fees are charged and make the fees easy for participants to see. But minimizing expenses for everyone continues to be our main objective. How fees work now Right now you are paying fees even though you might not have noticed them. They are not really spelled out in your quarterly statement. fees will be prorated and charged monthly to your account. You will also see any funds credited to you from revenue sharing. These credits will go directly back into your account. Each of the fund managers charge you a management fee to participate in their investment fund. It is a percentage of the assets in your account. You can see these fees on the “fund fact sheet” for each investment option, available from your Tandem representative or at www.tandem457.org. For example, someone with $5,000 in his or her account would see information something like this: The management fee is subtracted from the fund’s investment return before it hits your statement. The returns on your quarterly statements are now “net of fees.” Like the arrangement in many 457 plans, some fund managers make payments back to the record keeper (often called “revenue sharing”). Currently, Tandem’s administrative expenses (record keeper and KPERS) are funded through revenue sharing. Some participants pay more and others less depending on how the investment fund they chose handles fees. If your investment fund makes revenue sharing payments, you will see it credited to your account as a line item on your statement. A new way of doing things Beginning in January, your fees will be straightforward and transparent. You will see administrative and oversight fees spelled out specifically on each quarterly statement. The annual If you have a loan from your Tandem account ... We’ll send you a separate letter about how we will handle your loan payments. Great-West Financial® (0.173%) KPERS (0.048%) $0.72* $0.20* * Annual amount is divided by 12 for the prorated monthly amount. We are also adding a listing of all fund manager fees. Your investment returns will still be net of fees. But you can find your investment fund in the list to see what the manager is charging you to invest your money. All things being equal Fund manager fees will continue to vary according to which investment fund you choose. But all participants will pay the same plan administration fee. Equity for all participants was an important goal for the board of trustees in making these changes. About the Stable Value Fund The Stable Value Fund’s management will transfer to Great-West Financial. It will keep the same objective of preserving your principal and providing a stable, competitive return. KPERS will continue to oversee the investment guidelines, just as it has been since 2007. The guarantee behind Tandem’s Stable Value Fund will remain in place and will do so at a significantly lower fee than you have now. P41-888-275-5737 www.kpers.org/tandem.html Investment Options You do not need to do anything if you are happy with your current portfolio makeup. Your money is invested in the Tandem 457 Plan and its menu of investment options. Even with the move to a new record keeper, the investment options are staying pretty much the same. Four investment options will have a name change, but they will still be the same investments. Totally unrelated to the recordkeeper change, one fund, Columbia Mid Cap Value Opportunity, has recently broadened its types of investments and no longer fits within the asset class. We will replace this fund in January. Otherwise, it’s business as usual. Current Investment Fund Name Ticker Expense Ratio Shared Net Fund Revenue* Manager Expense INVESTMENTS WITH A FUND NAME CHANGE Stable Value Option Stable Value Funda VOYA T. Rowe Price Cap Appreciation - Inst T. Rowe Price Capital Appreciationb American Funds Growth Fund of Amer R5 American Funds Growth Fund of Amer R6 American Funds Capital World G/I R5 American Funds Capital World G/I R6c N/A PRWCX RGAGX RWIGX 0.28% 0.71% 0.34% 0.45% 0.00% 0.15% 0.00% 0.00% 0.28% 0.56% 0.34% 0.45% REPLACEMENT INVESTMENT Columbia Mid Cap Value Opportunity K Vanguard Selected Value Invd VASVX 0.44% 0.00% 0.44% CONTINUING INVESTMENTS Vanguard Total Bond Market Index Inst Vanguard Target Retirement Income Inv Vanguard Target Retirement 2015 Inv Vanguard Target Retirement 2025 Inv Vanguard Target Retirement 2035 Inv Vanguard Target Retirement 2045 Inv Vanguard Target Retirement 2055 Inv AllianzGI NFJ Dividend Value Instl Vanguard Institutional Index Instl Fidelity Contrafund Vanguard Mid Cap Index Inst Columbia Acorn A AllianzGI NFJ Small-Cap Value Instl Vanguard Small Cap Index Instl Baron Growth Instl Dodge & Cox International Stock Fund Vanguard Total Bond Market Index Inste Vanguard Target Retirement Income Invb Vanguard Target Retirement 2015 Invb,f Vanguard Target Retirement 2025 Invb,f Vanguard Target Retirement 2035 Invb,f Vanguard Target Retirement 2045 Invb,f Vanguard Target Retirement 2055 Invb,f AllianzGI NFJ Dividend Value Instl Vanguard Institutional Index Instl Fidelity Contrafund Vanguard Mid Cap Index Instd Columbia Acorn Ad AllianzGI NFJ Small-Cap Value Instld Vanguard Small Cap Index Instld Baron Growth Instld Dodge & Cox International Stock Fundc VBTIX VTINX VTXVX VTTVX VTTHX VTIVX VFFVX NFJEX VINIX FCNTX VMCIX LACAX PSVIX VSCIX BGRIX DODFX 0.07% 0.16% 0.16% 0.17% 0.18% 0.18% 0.18% 0.71% 0.04% 0.67% 0.08% 1.08% 0.77% 0.08% 1.05% 0.64% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.10% 0.00% 0.25% 0.00% 0.50% 0.10% 0.00% 0.15% 0.10% 0.07% 0.16% 0.16% 0.17% 0.18% 0.18% 0.18% 0.61% 0.04% 0.42% 0.08% 0.58% 0.67% 0.08% 0.90% 0.54% * Some fund managers make payments back to the record keeper, often called revenue sharing. Beginning January 1, 2015, Tandem will credit funds from revenue sharing back to the individual participant invested in the fund. Note: If you have a self-directed brokerage account through Voya Ultimate, you will receive a separate letter explaining how the transition will affect this investment option. Please consider the investment objectives, risks, fees and expenses carefully before investing. For this and other important information about investments offered through your Plan, you may obtain mutual fund prospectuses for registered investment options and/or disclosure documents from your registered representative or Plan website. Please read them carefully before investing. aThe Stable Value Fund is a separate account product offered by Great-West Life & Annuity Insurance and is not backed by the general assets of the insurer. b Asset allocation and balanced investment options and models are subject to the risks of the underlying funds, which can be a mix of stocks/stock funds and bonds/bond funds. For more information, see the prospectus and/or disclosure documents. c Foreign investments involve special risks, including currency fluctuations and political developments. d Equity securities of small- or medium-sized companies may be more volatile than securities of larger, more established companies. e A bond fund’s yield, share price and total return change daily and are based on changes in interest rates, market conditions, economic and political news, and the quality and maturity of its investments. In general, bond prices fall when interest rates rise and vice versa. f The date in a Target Date Fund represents an approximate date when an investor turns age 65. The principal value of the funds is not guaranteed at any time, including the target date. 1-888-275-5737 www.kpers.org/tandem.html P5 Plan Ahead for the Transition The recordkeeper transition will begin at 3 p.m. CST on December 23, 2014, and will be completed by the end of the business day on January 21, 2015. During this time you will not be able to make changes to your account so that records can be transferred. Your money will remain invested. What is the blackout period? For retirees The blackout period is a time that, although your funds continue to be invested, you can’t do any transactions. This includes activities such as investment option changes, fund transfers, contribution amount changes and withdrawals. If you are getting regular payments from your Tandem account, they will continue as usual through December 22, 2014. Payments between December 23 and January 21 will be affected by the blackout period. You’ll receive a separate letter explaining the timing of your payments during the blackout period. The blackout period is necessary for the current service provider to finalize records and transfer them to the new service provider. The new provider will then process and verify them. Blackout period starts: 3 p.m. CST, December 23 Blackout period ends: close of business, January 21 How does this affect you? If you are planning to make account changes toward the end of this year, you need to have them done by December 23, but the earlier the better. Otherwise, you’ll need to wait until January 22. Take some time to consider if this blackout period might affect your retirement planning and timing for any account activity. Because your funds will stay invested, they will continue to gain and/or lose value depending on market conditions. Please see the “Important Notice Concerning Your Rights Under the Plan” insert for more information. During the blackout period, you will still be able to see your information through your current online account at www.tandem457.org. But you won’t be able to make any changes. You can also call or e-mail ING/Voya during this time. P61-888-275-5737 www.kpers.org/tandem.html New online account access With Tandem’s new website, you’ll also have a new account login. We will mail you instructions the week of January 12. Beginning January 21, you can use it to activate your new account at www.tandem457.org.2 That would be a good time to review your beneficiary information to be sure the right person would get your Tandem account balance should the unthinkable happen. $0 balance on your statement The ING/Voya quarterly account statement you will receive in January for the fourth quarter of 2014 will show a $0 ending balance. Don’t panic! This is the final statement prepared by the current service provider. The $0 balance is a normal part of the recordkeeping transition process. In April, you will receive your statement for the first quarter of 2015, prepared by Great-West Financial. It will show a starting balance of $0 and a “deposit” for your full account balance, plus any contributions, dividends, etc., from the first quarter. Key Transition Dates3 Remember, there is nothing you need to do with your investments! Your investment choices and other account information will move automatically to the new service provider. And your money will stay invested in the market during the blackout period. Important reminders November and December Informational group meetings across the State about the transition.4 • All accounts will be restricted from 3 p.m. CST on December 23 until close of business on January 21. Week of December 1 Letters mailed to retirees about payments during the blackout period. • Complete any account activity by December 23. December 23 3 p.m. CST Cutoff date to make fund transfers and other changes to your account before the transition blackout period begins. Week of January 12 Setup information mailed to you for new online account access. After January 21, use it to activate your account login at www.tandem457.org.2 • You can continue to view your account online during the transition or by calling Tandem. Important Dates Week of January 12 Final quarterly statement from current record keeper with a $0 ending balance. Your full balance will show on your next quarterly statement, mailed in April. January 21 Close of business Blackout period ends. You can make transfers and changes to your account again at www. tandem457.org or by calling 1-800-232-0024.2 Use your new login credentials to access your new online account. January 2 Tandem’s Topeka office is open for business at 800 SW Jackson, 11th Floor, our new location. • You will have a new online account login starting January 21. We’ll send you a PIN1 for access. Questions? Account service: 1-800-232-0024 [email protected] The transition: 1-888-275-5737 [email protected] You can also attend an informational meeting. If you are planning to retire in December or January See www.kpers.org/ If you are planning to retire in December or January, please work with your Tandem representative to create a plan tailored to your specific situation. He or she will also be able to help you with the rollover process if you are receiving a partial lump sum from KPERS as part of your retirement. tandem.html for the most current schedule. 1-888-275-5737 www.kpers.org/tandem.html P7 Attend a Meeting in Your Area As part of Tandem’s transition to Great-West Financial, we will hold more than 250 employee meetings MEETINGS MEETINGS MEETINGS all over the State during the weeks of: • November 17-21 MEETINGS • December 1-5 • December 8-12 MEETIN MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETINGS MEETI NGS MEETINGS MEETINGS MEETINGSGS MEETINGS Visit www.kpers.org/tandem.html to see a complete schedule. New meetings are being added every day, so check the calendar often! LOCAL EMPLOYEE TRANSITION BULLETIN 1 The account owner is responsible for keeping the assigned PIN/password confidential. Please contact Great-West Financial immediately if you suspect any unauthorized use. 2 Access to the information line and/or any website may be limited or unavailable during periods of peak demand, market volatility, systems upgrades/maintenance or other reasons. Transfer requests made via the website and/or the information line received on business days prior to close of the New York Stock Exchange (4:00 p.m. Eastern Time or earlier on some holidays or other special circumstances) will be initiated at the close of business the same day the request was received. The actual effective date of your transaction may vary depending on the investment option selected. 3 These dates and times are subject to change based on the ability of ING/Voya and Great-West Financial to meet the associated deadlines and the successful transfer of data and assets by ING/Voya to Great-West Financial. 4 Representatives of GWFS Equities, Inc. are not registered investment advisors and cannot offer financial, legal or tax advice. Please consult with your financial planner, attorney and/or tax advisor as needed. Core securities, when offered, are offered through GWFS Equities, Inc. and/or other broker dealers. GWFS Equities, Inc., Member FINRA/SIPC, is a wholly owned subsidiary of Great-West Life & Annuity Insurance Company. GreatWest Financial® refers to products and services provided by Great-West Life & Annuity Insurance Company (GWL&A), Corporate Headquarters: Greenwood Village, CO, and its subsidiaries and affiliates. ING/Voya and Voya Ultimate are not affiliated with GWFS Equities, Inc. Core investment options offered through mutual funds and a separately managed account. GWFS Equities, Inc., or one or more of its affiliates, may receive a fee from the investment option provider for providing certain recordkeeping, distribution and administrative services. Guidance and Advice services are offered by Advised Assets Group, LLC (AAG), a federally registered investment adviser and wholly owned subsidiary of Great-West Life & Annuity Insurance Company. More information can be found at www.adviserinfo.sec.gov. All trademarks, logos, service marks, and design elements used are owned by their respective owners and are used by permission. ©2014 Great-West Life & Annuity Insurance Company. All rights reserved. CB1209LTB PT211648 (11/2014) 1-888-275-5737 www.kpers.org/tandem.html
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