What is Deferred Comp?
The purpose of a deferred compensation plan is to produce tax delays and/or tax savings on monies you set aside for retirement. You will have a choice between a standard deferred compensation herein called a 457 account or a 457 Roth account or you can even have both.
A standard 457 allows you to set aside a part of your salary and postpone paying taxes on that salary until after retirement. This may prove to be advantageous for two reasons:
- It is likely that your income will be lower after retirement, and therefore, you may be in a lower tax bracket.
- Pre-tax deposits allow you to accumulate more money over time than after-tax deposits.
A Roth 457 account is funded with salary that has already been taxed. This may prove to be advantageous for two reasons:
- No taxes are due on withdrawals from the account taken during retirement.
- The growth in the account is not taxable.
Deferred compensation was intended by congress to be a retirement plan as opposed to a short-term savings plan. Hence, your funds may not be withdrawn until you have separated service from your employer unless approved for an emergency withdrawal or you are eligible to secure a loan on part of your balance.
Am I eligible to participate?
Any permanent County/ARC employee or elected official may participate in a deferred compensation plan. Enrollment takes place provided that an agreement to defer compensation not yet earned is completed and turned in to payroll prior to the first day of the coverage month.
How do I get enrolled in Deferred Compensation?
You simply contact your provider of choice. You have four providers to choose from. You can ask your coworkers if they have a recommendation and you can consult the Deferred Compensation Provider Comparison document for assistance.
How much can I contribute to my 457 accounts each year?
A 457(b) plan’s annual contributions and other additions (excluding earnings) to a participant’s account cannot exceed the lesser of:
- 100% of the participant's includible compensation, or
- the 457(b) elective deferral limit
Increases to the general annual contribution limit:
- 457(b) plans of state and local governments may allow catch-up contributions for participants who are aged 50 or older.
- Special 457(b) catch-up contributions allow a participant for 3 years prior to the normal retirement age (as specified in the plan) to contribute the lesser of:
- Twice the annual 457(b) limit , or
- The basic annual limit plus the amount of the basic limit not used in prior years (only allowed if not using age 50 or over catch-up contributions)
Can I move my 457 balance from one provider to another?
You can move your funds to or from MNDCP, Mission Square, Nationwide or Lincoln. You cannot move them to an external entity until you have separated employment. Contact the provider you wish to move your funds to for assistance.
Can I increase my 457 contribution for one pay period and then have it resume at my previous amount thereafter?
Yes. Use the
I have left employment and would like to begin withdrawals from my 457 account(s). What are the steps I need to take?
Follow the Withdrawing Funds Instructions.
How can I learn more about Deferred Compensation?
See the St. Louis County
You need a retirement consult if....
- you read in your packet/webpage that your circumstance requires a consult
- you still have retirement questions after reviewing your packet or webpage
- you want confirmation of your understanding of your packet or webpage
About Retirement Consults:
- Phone, Teams or Webex formats available
- Typically 15-30 minutes in duration
- Significant others are welcome to join
- Review your retirement packet or retirement webpage prior to this meeting
- You will lead this meeting with your questions
- best to hold this 30 minute meeting 1-8 weeks prior to retirement date
- PERA application and written notice to supervisor must be submitted prior to requesting this meeting
- you will make your written elections for continuation or cancelation of insurances at this meeting
- you will receive an overview of post-retirement action steps you will need to complete
- meetings are in person, Phone, Teams or WebEx formats available upon request
Upcoming and Recent PERA Retirement Workshops (Tailored to all state PERA retirees)
St. Louis County will resume offering a retirement workshop each spring and fall for St. Louis County employee who are 1-5 years from retirement once all presenters are cleared for travel by their respective employers. Please see quarterly training catalog . This workshop is tailored to St. Louis County Retirees.