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United Methodist Personal Investment Plan
November 2015
Vol. III, Issue 3

Roth Contributions Coming in 2016

Participants in the United Methodist Personal Investment Plan (UMPIP) and the Horizon 401(k) Plan will have a new opportunity for retirement savings beginning in 2016—the ability to make Roth contributions. Participants also may roll over Roth contributions from prior employer retirement plans.

Why Roth?
Numerous requests from participants and plan sponsors prompted the General Board to begin accepting Roth contributions. Roth contributions are unique because they are made to defined contribution plans on an after-tax basis. Those contributions—as well as the earnings—are tax-free at withdrawal as long as:

Is Roth a Good Choice for All Participants?
Contributing on a Roth basis may create advantageous tax outcomes for some participants, but could create detrimental tax outcomes for both lay and clergy participants. In general, Roth contributions may be a good choice for participants who:

However, clergy should consider their housing allowance exclusion and/or SECA tax circumstances, as applicable, before electing to make Roth contributions.

A participant’s overall retirement savings strategy is informed by personal financial circumstances. Therefore, investing choices should be discussed with a personal financial planner. The General Board contracts with EY Financial Planning Services to provide confidential, objective financial counseling to eligible participants at no charge. We encourage participants to contact EY at 1-800-360-2539 for a personalized Roth consultation. EY Financial Planning Services has developed clergy-specific tools to help participants understand the impact of their housing allowance exclusion and/or SECA tax circumstances on their Roth decision.

Costs for these services are included in the General Board’s administrative expenses that are paid for by the funds. EY Financial Planning Services are available to active participants and surviving spouses with account balances, and to retired and terminated participants with account balances of at least $10,000.

What’s Next?
The Roth Contribution Guide was mailed to plan sponsors in early October and will be sent in the coming weeks to targeted participants who currently make after-tax contributions. We have revised the Contribution Election Form (formerly the Before-tax and After-tax Contributions Agreement) and can help with revisions to any customized form for contribution elections that is used by your participants.

The General Board also will hold webinars to discuss procedural changes and answer plan sponsor questions about Roth. There are three, one-hour webinars scheduled:

All webinars cover the same information; choose the date and time that works best for you.

Accessing the Webinars

  1. Select the link next to your preferred date. If you’re a first-time GoToMeeting user, please allow time for the program to download.
  2. Once you join the meeting, choose an audio option. Selecting “phone call” will provide the best audio performance.
  3. The appropriate dial-in number, access code and PIN will be listed on the meeting screen for the webconference.

If you have questions about GoToMeeting or need technical support, contact GoToMeeting at 1-855-352-9002 and select option 1. You can also find information about accessing GoToMeeting at http://help.citrix.com/meeting. Answers for questions about Roth and help with form revisions are available by contacting the General Board at retirement_services@gbophb.org.

EY Website Changes in November

EY recently implemented two changes to its website that will affect participants seeking information about financial wellness.

Website Upgrades
The General Board has offered EY Financial Planning services since 2005 to help participants improve financial understanding and receive assistance with financial matters. Confidential, objective guidance has been available by phone, while more general information and educational opportunities (e.g., webinars) were available via the EY website. EY recently upgraded its website to better serve participants.

The new EY website offers more guidance, support and interactive tools, including:

Participants used generic login information in the past to access the site; however, the new website requires participants to register with unique usernames and passwords. This helps ensure the security of participant information as EY continues to expand website functionality.

Registration is quick and easy. To register, participants must visit https://gbophb.eyfpc.com, click “Register now,” and enter the requested information. Participants will need their Employee IDs/participant numbers for registration, which are available:

Financial Wellness Assessments
One of the new tools available on the EY website is the Financial Wellness Assessment. Financial wellness is an important goal for participants—and is considered by the Center for Health to be one of the five dimensions of health that are equally vital for overall well-being.

The link between psychological stress and physical health and well-being is well documented. The American Psychological Association found in 2014 that money is the top source of stress in the United States. Financial worries also impact productivity at work. In fact, a 2014 Aon Hewitt study found that approximately 20% of employees had skipped work in the past year to deal with a financial problem; 39% of the financially stressed admitted to either thinking about or dealing with financial problems at work.

Understanding is the first step in addressing any problem, and that is also true of financial concerns. Participants are encouraged to complete the assessment and review the suggested resources that are based on their answers. EY financial planners are available for additional guidance at no charge by phone or via the Web chat feature on the site.

Participant Contribution Limits for 2016

The IRS recently announced that retirement plan contribution limits are unchanged for 2016. Participants will continue to be able to make before-tax and/or Roth contributions of up to $18,000 ($24,000 if age 50 or older). Participants who have 15 or more years of service with a “qualified organization” also may be able to contribute up to an additional $3,000 (subject to a $15,000 lifetime limit and other rules).

Total 403(b) plan contributions—including annual before-tax, Roth and after-tax contributions, and plan sponsor contributions but not including “qualified organization” or age-50 catch-up contributions—may not exceed the lesser of participant taxable compensation or $53,000 for 2016. (Note: Clergy housing, if applicable, is excluded from compensation for this calculation.) Participants can contact the General Board at 1-800-851-2201 for a 403(b) Contribution Planner to determine the maximum contributions that can be made to his or her account.

Multiple Plan Offerings
If you offer more than one 403(b) plan option to participants, you should consider a participant’s total annual contributions when assessing compliance with the IRS limits. To assist you with administering your plans, the General Board:

In order for the General Board to assist with these items, please fill out the Information Sharing Agreement if you offer multiple 403(b) plans.

If you have a participant who has made excess contributions, the IRS offers guidance for employers and participants. The General Board also can help you bring your plan into compliance. Contact the General Board with questions and concerns.

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