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 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 on the 6-year vesting schedule. When you retire, you'll receive only an Investment Plan benefit. If you terminate employment prior to completing 6 years of service, you could forfeit the amount transferred from the Pension Plan, unless you do not take any distribution from your Investment Plan account and you return to FRS-covered employment within 5 years and complete the necessary 6 years of total service.
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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.
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