Beginning May 1, account holders with very low balances will pay administrative fees
In its most recent meeting, the ERS Board of Trustees voted to change the administrative fee structure of the Texa$aver 401(k) / 457 Program, effective May 1, 2019. Most Texa$aver participants won’t see any changes to the fees they pay. Accountholders with balances of $10.00 or less, who currently don’t pay any administrative fees, will be assessed fees beginning May 1.
New Administrative Fee Structure
(Per Participant, Per Account)
|$1,000.00 or less
|between $1,000.01 to $16,000.00
|between $16,000.01 to $32,000.00
|between $32,000.01 to $48,000.00
|between $48,000.01 to $64,000.00
|$64,000.01 or more
The fees will be charged to accounts with balances of $10.00 or less beginning June 4, 2019. If someone with $10.00 or less in their Texa$aver account doesn’t take any action and their account balance reaches $0.00, their account will be closed.
How you can keep your account open if you currently have $10.00 or less?
If you have $10.00 or less in your Texa$aver account and are still employed by a state agency or participating higher education institution, you have the chance to make a smart money move in 2019: contribute to your Texa$aver account directly from your paycheck.
A payroll contribution is easy and reduces your taxable income. You can set it up online at texasaver.com, or by calling tollfree at (800) 634-5091, Monday- Friday, 7 a.m. - 9 p.m., CT; Saturday, 8 a.m. - 4:30 p.m. CT.
If you don’t know how much to contribute, Texa$aver has the tools to help you plan and meet your retirement savings goals. You can meet with an Education Counselor or access the easy-to-understand online planning tools – all available at no additional cost to you.
As with any financial decision, you should talk to your financial or tax advisor about closing your Texa$aver account. You can also call the Texa$aver Customer Service Center at (800) 634-5091 if you have questions about this change or about your options with the Texa$aver program.
Why is the fee structure changing?
ERS has changed the fee structure to ensure that all accountholders pay their fair share for the costs of running the program. The State of Texas does not make any contributions for Texa$aver, not even for administrative costs. The program is funded entirely by participants. All accounts have administrative costs, even those with low balances. This change in the fee structure means that all accounts will now help pay for those costs.
This material has been prepared for informational and educational purposes only and is not intended to provide investment, legal or tax advice.