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Paycheck increase allows for more savings

Posted on June 22, 2023

At the beginning of July, state employees under PERS may notice a 4% increase to their paycheck. This increase is thanks to legislation that passed in March 2023 and is intended to help you with the cost of inflation.

With the extra money coming in, you may feel like you can finally plan that trip to California. Go ahead and book the vacation — just don’t forget about your long-term goals too.

One of the great things about getting a paycheck increase is that it allows you to have more flexibility with your budget.

You can use the extra money to:

pay off credit card debt
save for a big vacation
open an account or add to your child’s 529 college savings fund
increase your DCP contributions for retirement

No matter how you decide to use the extra funds, know that setting aside a small amount of $50 or $100 to an account every month can add up overtime.

How to change your DCP contributions

If you’re contributing a percentage of your paycheck to DCP – your account will automatically benefit from this increase. And now is a great time to raise that number. If you’re contributing 3%, consider increasing it to 4 or 5%.

Log into your DRS account.
From the account page, under “My Investments” select DCP
This will open a new window with DCP and Voya
Select the tab for Contributions & Savings
Select Manage Contributions
Select Update My Contributions

Log into your account

Don’t have an account? It only takes a few minutes to enroll.

Example: Jo puts in $200 a month to a DCP account. Over the next 30 years, (at a 6% standard rate of return) that account could grow to over $200,000. Of that total, $130,000 will come from compound interest.

Listen to the DCP podcast episode

In episode 11 of the DRS podcast, you’ll learn all about DCP and how it can help you save for retirement. Find out how taxes are applied, the importance of contributing with a percentage of your income and tools for maximizing your investment.

You also have the option to read the transcript.