Changing Plans



 
You have a one-time (once in your active FRS career) opportunity after your Choice period ends, or you make your plan election, if earlier, to switch from the Investment Plan to the Pension Plan, or from the Pension Plan to the Investment Plan.
 
Your 2nd Election Enrollment Form must be received by the Plan Choice Administrator, Alight Solutions, while still earning service credit and before your date of termination.
 
Once you have made a retirement plan election you have a limited time period during which you may be able to cancel the election. See the following FAQ for more information.
 
FRS Pension Plan FRS Investment Plan
If you want to move to the Investment Plan after selecting the Pension Plan, you have two options:
 
  • You can leave your accumulated Pension Plan benefit in place, frozen at the time you make this choice, and your future employer and employee contributions will go into your Investment Plan account. When you retire (provided you're vested), you'll receive a Pension Plan benefit and an Investment Plan benefit. You must have at least 5 years of service in the Pension Plan to select this option.

  • Or, you can move the present value of your Pension Plan benefit into the Investment Plan. If you do this, the amount that you are moving into the Investment Plan will be subject to the Pension Plan's vesting schedule (see below). When you retire, you'll receive only an Investment Plan benefit.

  • If you terminate employment prior to vesting in the amount transferred from the Pension Plan, you could forfeit the accumulated benefit transferred. If you are not vested in the amount transferred and do not return to FRS-covered employment within 5 years and complete the necessary service to vest - these funds will be forfeited. You would only be eligible to receive any contributions made after your Investment Plan election date. Also, if you take a distribution of any vested service without completing the necessary service to vest, you will forfeit the amount transferred from the Pension Plan.

  • Your present value amount is not classified as employee or employer contributions (your records will indicate zero employee and employer contributions). You will begin to accrue employee and employer contributions again after the transfer to the Investment Plan.

  • If you enrolled in the FRS prior to July 1, 2011, you must have 6 years of service to vest. If you enrolled in the FRS on or after July 1, 2011, you must have 8 years of service to vest.

If you want to move to the Pension Plan after selecting the Investment Plan, you'll have to "buy back" into the Pension Plan with the money in your Investment Plan account. If you transferred a present-value amount to the Investment Plan as your opening account balance, the calculation of your "buy-back" cost is a present-value calculation of benefits as if you had stayed in the Pension Plan for all years through the effective date of the change back to the Pension Plan.
 
If you did not transfer a present-value amount, your "buy-back" cost will be the actuarial accrued liability or total cost of your plan benefit.
 
After your "buy-back" cost is calculated, the payment process depends on whether your "buy-back" cost is less than the value of your Investment Plan account.
 
  • If the value of your Investment Plan account is more than the cost of buying back into the Pension Plan:
    • You'll still keep an Investment Plan account, but the "buy-back" amount will be deducted from your account and transferred to the Pension Plan Trust Fund. You will continue to manage the excess until your retirement from the Pension Plan, at which time, you may take a distribution from your Investment Plan account.

    • You'll also participate in the Pension Plan and begin accruing a benefit based on your total service, salary and FRS membership class.


  • If the value of your Investment Plan account is less than the cost of buying back into the Pension Plan, you can still get back in, but you will have to make up the difference from your own personal savings. At that point, your Investment Plan participation will end.

  • The buyback amount is not classified as employee or employer contributions (your records will indicate zero employee and employer contributions). You will begin to accrue employee and employer contributions again after the transfer to the Pension Plan.