Plan Updates

Plan Match Suspension Extended

The Plan match has been suspended and removed from the Fiscal Year 2011 (July 1, 2010 - June 30, 2011) budget approved by both the house and senate and signed by the Governor.

Continuing budget shortfalls have affected the state’s ability to restart the incentive payment that was suspended for paychecks from March 31, 2010 through June 30, 2010 by the State Division of Budget and Planning.

Plan Is an Important Retirement Savings Tool despite Match Suspension

The State of Missouri Deferred Compensation Plan continues to provide a simple way to build supplemental savings and offers these benefits:

  • Lower income taxes: Each dollar you contribute lowers your taxable income by a dollar. It’s easy to contribute through payroll deduction. 
  • Tax-deferred growth: No taxes are due on investment earnings until you withdraw the money, generally at retirement or separation from service.
  • Flexibility: Unlike traditional or Roth IRAs, there is no penalty if you withdraw money from the 457 Plan portion of your account following termination or retirement prior to age 59½.
  • Low investment fees: You can invest your tax-deferred contributions at substantially lower cost (maximum 0.30% expense ratio), and there’s no fee to access a self-directed brokerage account.
  • Missouri Custom Target Date funds: These are professionally-managed investment options that automatically change as you age and offer built-in diversification to help reduce the impact of market volatility.
  • Easy access: Fund information and financial tools, including the My Retirement Outlook calculator, is available 24/7 at www.modeferredcomp.org.
  • Plan consultants: You can get personal assistance if you have questions or need help with understanding your Plan benefits.

Remember, it is still important to save for retirement. Consider that the average State of Missouri employee’s pension and Social Security benefits will replace approximately 65% of pre-retirement income. For this reason, it is crucial to have supplemental savings for retirement.

The following scenarios show what the average State of Missouri employee who works for 20 years and retires making $35,000 might need to set aside while employed to accumulate enough personal savings to supplement pension and Social Security income to potentially live comfortably for 25 years in retirement.

Personal Savings Chart

These are hypothetical examples that assume a 6% annual return while the employee is working and saving, and a 4% return during a retirement of 25 years based on 2010 dollars. This information is for illustrative purposes and is not intended as a guarantee of past or future performance of any security.