Customers of Washington state’s Plan 3 retirement systems and Deferred Compensation Program (DCP) will be served by a single record keeper starting in October of next year, the state Department of Retirement Systems announced today.
Empower Retirement, recently rebranded from Great-West Financial retirement services, will provide record keeping services for Plan 3 customers effective Oct. 1, 2015. Under provisions of a contract approved today, Empower will also continue to serve as the record keeper for DCP, a service it has provided to DRS customers since 2010.
“At DRS, we’ve been focused on ensuring everything we do is directed toward providing 100 percent customer satisfaction through high quality, cost effective products and services,” said DRS Director Marcie Frost. “With Empower as our partner, we believe this unified approach to record keeping services will strengthen our customers’ ability to prepare for a successful retirement.”
By combining record keeping services under a single provider, Frost said, customers will have the benefit of “one-stop” access to their member account and comprehensive retirement planning information, both online and on the phone.
In addition, Frost said, DRS and Empower will partner to develop user-friendly tools aimed at building awareness and action on retirement planning. One such product, she said, will be an annual statement that combines various sources of retirement income to give customers a snapshot of whether they are on track to meet their retirement goals – and how to take action to meet those goals.
“We view Empower as an innovative partner who can work with us to offer retirement readiness products and services that are accessible, understandable and personalized,” she said. “Our goal is to make it easier for customers to get engaged in preparing for retirement much earlier in their careers.”
Empower President Edmund F. Murphy III said, “We’re very pleased to have been selected as the exclusive record keeper for DRS. Empower and DRS share the same goal to bring a holistic retirement preparedness experience to customers.”
Murphy said customers will benefit from resources that range from advisory services to Empower’s popular online calculator. Customers also will benefit from a single intuitive website, single call center, consolidated statements and consistent messaging.
“The goal in retirement savings is to build and maintain income replacement during future retirement years. It is this priority that will be the chief focus of our partnership with DRS and its employees," he said.
Frost said DRS will be regularly communicating with customers about the next fall’s transition in Plan 3 record keeping services. She emphasized that there will be no change in investment options in either Plan 3 or DCP, as a part of this change.
With current contracts for record keepers expiring next year, DRS issued a Request for Proposals in June and conducted an extensive evaluation process of interested companies. The process included written proposals, interviews, and visits to individual companies. Great-West Financial (now Empower Retirement) was identified as the apparent successful bidder on Oct. 24, 2014.
Plan 3 is a hybrid defined benefit/defined contribution retirement plan offered in the state’s three largest retirement systems — the Public Employees’ Retirement System (PERS), the Teachers’ Retirement System (TRS) and the School Employees’ Retirement System (SERS). There are currently more than 111,000 active members enrolled in Plan 3. As of September 2014, the defined contribution assets in Plan 3 totaled just under $10.7 billion.
The Deferred Compensation Program is a voluntary, supplemental savings program that allows public employees to invest money through payroll deductions and defer federal taxes. DCP is currently offered by all state agencies and more than 800 local government employers. As of September 2014, the DCP asset balance exceeded $3.5 billion for more than 63,000 participants.
Also available: Questions and Answers about the Plan 3/DCP Record Keeper Procurement.