Help Participants Plan Future Contributions

It’s tax season. At this time of year, many participants evaluate their financial plans to determine whether their current savings strategies are sufficient to attain their goals. This evaluation may motivate participants to change their elections and increase their retirement savings contributions in order to attain their retirement goals.

UMPIP Participant Contribution Options

Now is a good time to help your participants understand their options. UMPIP offers two options for making participant contribution elections: percentage or dollar amount.

• Percentage-based contributions enable participants to automatically increase or decrease their contribution amounts when their compensation changes. This helps their retirement savings keep pace with raises.
• Dollar amount contributions allow participants to know exactly how much is being withheld from each paycheck. However, unlike a percentage-based contribution, if a participant’s pay increases, the contribution remains the same. Over time, this could result in a participant contributing too little to support his or her retirement goals.

Projecting Retirement Income

Make sure your participants know their contribution options. Encourage them to run projections using the Retirement Readiness Tool and/or Retirement Benefits Projection in Benefits Access to determine if the percentage or amount they are currently contributing is expected to be sufficient to support their retirement. These tools will also allow them to see how changes to their contribution rate will impact their retirement savings. Participants should run these projections annually or at times of compensation increases (e.g., promotions).

Ernst & Young Financial Planning Services can also help participants determine how much to contribute to meet retirement goals. These services are provided at no charge to all active participants and surviving spouses with an account balance, as well as retired and terminated participants with a balance of at least $10,000 in the General Board-administered retirement plans. Planners are available Monday through Friday from 8:00 a.m. to 7:00 p.m., Central time at 1-800-360-2539.

Changing Contributions

Participants may begin contributing or change their contribution elections at any time by submitting a Before-Tax and After-Tax Contributions Agreement to you. Make the appropriate payroll changes then submit a copy of the form to the General Board as instructed on the bottom of the form.

Participants Should Be Using Benefits Access

The Benefits Access website is an invaluable retirement planning resource for participants. Yet, many participants are not using all the features offered by the site. We would like your help promoting the website to your participant population.

The website—at www.benefitsaccess.org—enables participants to view and/or update:

• Benefits—including General Board-administered retirement plan account balances, contribution amounts or percentages, transactions, investment returns and allocations, and more
• Retirement Projections—including the Retirement Benefits Projection, which estimates General Board-administered accounts projected to their future retirement dates, or the Retirement Readiness Tool, which shows expected retirement income needs compared to participants’ projected retirement income
• Personal Profile—including contact information and beneficiary elections
• Financial Education —including articles on subjects related to account management and retirement planning

Participants also may elect to receive account statements and issues of the Hark newsletter via electronic delivery on the website.

Additional information about the Benefits Access website, including a navigation guide, is available on the General Board website. If your participants need help signing up, they may contact the General Board at 1-800-851-2201.

Stay In Compliance with IRS Plan Rules

When administering retirement plans, it’s important to be mindful of federal rules governing the plans, as well as elections made by your organization in the plan documents. The following provides help to make sure your plans stay in compliance.

1. Eligibility—Make sure that all participants who are eligible for the plan are given the opportunity to contribute and that all contributions are made to the plan. In most cases, all employees are eligible to contribute as soon as they are hired. To verify eligibility for plan sponsor contributions, refer to your UMPIP adoption agreement.
2. Contribution Accuracy—Keep compensation and contribution changes up-to-date. If a participant is contributing on a percentage basis, make sure that the dollar amount of the contribution that you deduct from his or her check correctly changes when his or her compensation changes. If you discover a participant’s contributions were overpaid (due to incorrect compensation amounts, payroll calculation errors, etc.), e-mail or fax a letter to the General Board (pateam@gbophb.org or 1-847-866-5191) explaining the overpayment, including the reason, names of the participants involved and overpayment amounts by month and year. After reviewing the letter, a General Board representative will contact you to discuss the appropriate resolution. If you discover contributions were underpaid, contact the Pension Administration Team at 1-800-851-2201 (press 3, then 2) for information on how to remit the additional contributions.
3. Contribution Due Dates—The due date for participant contributions to UMPIP accounts is within 15 business days following the end of the month in which the amounts should have been withheld from paychecks. If contributions are not deposited within two months following the end of that month, investment earnings are also required to be paid. The General Board will calculate these investment earnings upon request.
4. Contribution Changes—Verify that you have received a new Before-Tax and After-Tax Contributions Agreement from any participant who is electing to 1) increase or decrease his or her contribution amount or rate, or 2) stop contributing to the plan. Making contribution changes before receiving a completed form could have legal and tax consequences.

For additional information about administering UMPIP, the UMPIP Administration Manual and participant forms are available on the General Board’s extranet at https://extranet.gbophb.org (user name: extranet; password: gbop!123) under Plan Documents, Forms & Guides.

Contact the General Board for Help with Plan Errors

Even seasoned professionals make mistakes when administering retirement plans. The Internal Revenue Service (IRS) offers the Employee Plans Compliance Resolution System (EPCRS)—a correction system for retirement plan sponsors, which permits employers to correct plan failures and thereby continue to provide their participants with retirement benefits on a tax-favored basis.

If you determine that your organization has made errors in administering the plan, you don’t have to go it alone. As your partner in administering retirement plans and programs, the General Board will help you evaluate and correct errors, as well as calculate any refunds or additional contributions necessary to bring your plan into compliance. Contact the General Board for more information.

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