Take advantage today

You can join the plan when an eligible employee elects to defer compensation for a calendar month by entering into a Deferred Compensation Agreement before the first day of the month in which the compensation is paid or made available. A new eligible employee may defer compensation payable in the calendar month which includes the first day of employment by entering into a Deferred Compensation Agreement on or before the first day of employment. 

There is no age or service requirement for eligible employees to participate in the plan.

Starting early has its advantages

Employee contributions

Through payroll deduction, the maximum amount you are allowed to contribute to your 457(b) plan is based on your taxable compensation as defined by the Internal Revenue Code (IRS). Generally, you can contribute up to 100% of your salary up to the maximum allowed annually, whichever is less.

Catch-up contributions 

You may be able to contribute up to an additional:

Stop/change contributions 

You may stop your contributions by giving notice to your employer prior to the beginning of the month for which the cessation of contributions is to be effective. Once you discontinue contributions, you may only start again as provided under the terms of the plan. You can increase or decrease the amount of your contributions by giving notice to your employer prior to the beginning of the month for which the change is to be effective.

Roth contributions 

You may also make after-tax contributions to a Roth account in the plan by convenient payroll deduction. You have a choice regarding your elective contributions. You can direct all of your contributions to a traditional pre-tax account, to a Roth account or to a combination of the two. Contributions to a Roth account are after-tax. Regardless of your election, you are subject to the annual contribution limits detailed previously. 

Vesting

Vesting is a participant’s right of ownership to the money in his or her plan account. 

You are always 100% vested in employee contributions, plus any earnings they generate.

Accessing your money

Withdrawals

Money may be withdrawn from the plan in these events:

• Death
• Disability
• Severance from employment
• Retirement
• Unforeseeable emergency which is defined as a severe financial hardship resulting from a sudden and unexpected illness or accident (involving the participant or a dependent), a loss of property due to casualty, or other similar extraordinary and unforeseeable circumstances due to events beyond your control. 
• A one-time withdrawal is allowed if your account balance is $5,000 or less and there have been no deferrals for the past two years and no prior withdrawals of this type have been taken. 
  

Income taxes are payable upon withdrawal. 

Loans

The plan is intended to help you put aside money for your retirement. However, Fayette County Public Schools has included a plan feature that enables you to access money from the plan. 

• The amount the plan can loan to you is limited by rules under the tax law. All loans will be limited to the lesser of: one-half of your vested account balance or $50,000. 
• The minimum loan amount is $1,000.
• All loans must generally be repaid within five years.
• You can have two loans outstanding at a time.
• A $50.00 processing fee for all new loans and a $50.00 per year loan maintenance fee are charged to your account.

Other requirements and limits must be met prior to borrowing money from your account. For additional information regarding loans, please see your financial professional.