UC Regents Select Fidelity Investments To Provide Record Keeping and Educational Services for New Tax-Advantaged 457(b) Retirement Savings Plan

The first step has been taken toward the implementation of the 457(b) plan - at the July 14-15 Board of Regents meeting, the University of California announced that it has selected Fidelity Investments Tax-Exempt Services Company to provide record keeping and investment education services for its new 457(b) tax-deferred savings plan.

In May, UC Regents approved a new voluntary savings plan that effectively doubles the amount of money faculty and staff may put into tax advantaged retirement savings. The new plan, defined as a 457(b) plan by the Internal Revenue Code (IRC), currently has the same contribution limits as the 403(b) plan, however, the contribution limits set by the IRC for each plan do not offset one another. For example, an employee who already contributes the maximum permitted to UC's 403(b) Plan ($13,000 in 2004) could also put up to $13,000 annually in tax-deferred savings in the new 457(b) plan. Employees will have the choice to enroll in either or both plans to save for retirement and enjoy valuable benefits of tax-deferred savings.

The selection of Fidelity concludes a four-month competitive bid process.   The process was led jointly by UC's HR-Benefits department and the Office of the Treasurer and involved consultation with numerous groups throughout the UC community, including faculty, staff, retirees, and advisory groups. Proposals submitted by financial service providers were evaluated on a number of criteria, notably long-term suitability, service level and cost. Fidelity demonstrated particular strength in their sophisticated consumer tools and their commitment to state-of-the-art technology.

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