[UCRDBR] Second Choice Window for Active Savings Choice Participants

[Departmental Benefits Representatives]

[cid:image002.png at 01D6E381.37A47760]

January 5, 2021

To:          Department Benefits Representatives (DBRs)
From:      HR Benefits Office
Re:          Second Choice Window for Active Savings Choice Participants
In March 2016, the UC Regents approved the Retirement Choice Program that provided eligible employees a choice of primary retirement benefits: Pension Choice, under the University of California Retirement Plan (UCRP), or Savings Choice, under the Defined Contribution (DC) Plan. Included in the approved Regents Item was a one-time opportunity for Savings Choice participants to switch to Pension Choice no sooner than 5 years after their initial election, subject to IRS approval.

Effective January 1, 2021, the Second Choice Window is now open for the first group of participants who elected Savings Choice in the calendar year 2016. Active Savings Choice participants will receive an email, followed by a notice in the mail, with information on their opportunity to switch including instructions on how to make a Second Choice election.

It is important to note that a Savings Choice participant does not need to take any action to stay in Savings Choice; they would only make an election if they want to switch to Pension Choice.

Second Choice Window for Savings Choice participants


*       Second Choice Window opened January 1, 2021 on the fifth calendar-year anniversary of the year in which Savings Choice was elected (see chart below).

*       Participants have 5 years and 5 months to make an election to switch to Pension Choice.

*       Elections to switch are effective the following July 1, subject to May 31 payroll deadline.

Savings Choice
Election Date

Second Choice
Window Opens

Second Choice
Window Closes

July 1, 2016 - December 31, 2016

January 1, 2021

May 31, 2026

January 1, 2017 - December 31, 2017

January 1, 2022

May 31, 2027

January 1, 2018 - December 31, 2018

January 1, 2023

May 31, 2028

January 1. 2019 - December 31, 2019

January 1, 2024

May 31, 2029

January 1, 2020 - December 31, 2020

January 1, 2025

May 31, 2030

Eligibility

A participant must be an Active Savings Choice participant on pay status and within their Second Choice Window to make a second choice election.

A switch to Pension Choice will be effective the following plan year (July 1) after making their election, subject to a May 31 payroll-processing deadline. For example, if the election is made by May 31, 2021, the change will be effective on July 1, 2021. If the election is made on or after June 1, 2021, the election will be effective July 1, 2022.

Eligibility for the Second Choice Window is subject to collective bargaining.

Benefits upon a Second Choice switch to Pension Choice


*       Balances in the Savings Choice participant's DC plan will remain and the participant can continue to direct their investment.

*       Members will begin to contribute to UCRP and earn UCRP service credit on a prospective basis.

*       Savings Choice service credit will be used for vesting in UCRP and retiree health benefits.

*       Savings Choice service will not be used for calculating UCRP benefits or count towards vesting in the Pension Choice DC supplemental account, if applicable.

*       Second Choice election process.

To make a second choice election, an active Savings Choice participant must complete the UCRS 216 Election to Change Primary Retirement Benefit From Savings Choice To Pension Choice form and submit to the Retirement Administration Service Center. No action is required if the participant wants to stay in Savings Choice.

Participant notification


*       Initial email notification was sent to employees in December 2020.

*       Initial mail notification sent to employees in January 2021 will include the following:

o   Notice of opportunity to switch during Second Choice Window.

o   UCRS 216 election form<https://hr.ucr.edu/sites/g/files/rcwecm656/files/2021-01/election-form-ucrs216.pdf>.

o   Second Choice Window fact sheet<https://hr.ucr.edu/sites/g/files/rcwecm656/files/2021-01/second-choice-fact-sheet.pdf>.

*       UCnet article on December 22, 2020<https://ucnet.universityofcalifornia.edu/news/2020/12/second-choice-opportunity-approved-for-savings-choice-participants-beginning-in-2021.html>.

It is important to note that a member who receives a notice must still be an active Savings Choice participant to make an election. If the participant separates, or is on a leave without pay, they are not eligible to make a second choice election.

Employees may be directed to the following UC resources


*       UCnet<https://ucnet.universityofcalifornia.edu/compensation-and-benefits/retirement-benefits/2016-retirement-choice/second-choice-window-for-savings-choice-participants.html>.

*       Fidelity Retirement Planners: (800) 558-9182 or http://getguidance.fidelity.com/universityofcalifornia.

*       RASC: (800) 888-8267 or Secure Message via UCRAYS:
https://retirementatyourservice.ucop.edu<https://retirementatyourservice.ucop.edu/>


-------------- next part --------------
An HTML attachment was scrubbed...
URL: <https://lists.ucr.edu/pipermail/ucrdbr/attachments/20210106/f8969394/attachment.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image002.png
Type: image/png
Size: 20303 bytes
Desc: image002.png
URL: <https://lists.ucr.edu/pipermail/ucrdbr/attachments/20210106/f8969394/attachment.png>