Your Hybrid Retirement Plan has two components and a few accounts where contributions are deposited. Check out the illustrations below to see how your future benefit is comprised.
The Defined Contribution Component
The defined contribution component of your plan consists of two accounts:
- A 401(a) account for mandatory employee and employer contributions, and employer matching contributions.
- A 457 account for voluntary employee contributions.
Similar to a 401(k), these accounts provide a balance based on contributions and investment performance to draw from in retirement. Federal tax rules require different contribution types to be placed in separate accounts.
Take full advantage of the plan features by making the maximum 4% voluntary contribution, which allows you to receive the maximum 2.5% employer match.
Defined Contribution Component
The Defined Benefit Component
The defined benefit, or pension, component of your plan provides a lifetime monthly benefit based on a formula once you meet the eligibility requirements to retire.
Your 4% contribution is placed in your Member Contribution Account and helps fund your monthly retirement benefit. Your employer also makes a separate contribution to fund member benefits. VRS manages the investments for the defined benefit component.
Defined Benefit Component
Visit varetire.org/hybrid to learn more about the hybrid plan and to access:
- Your myVRS and DCP accounts, where you’ll see your fund balances.
- Short explainer videos on the Hybrid Plan Learning Channel.
- Plan details in the Hybrid Retirement Plan handbook.
- A link to the Hybrid DCP website, where you’ll find calculators and other resources from Voya Financial to help you maximize your retirement savings.
