In 2018, the Virginia Retirement System (VRS) successfully promoted the importance of saving more for retirement to Hybrid Retirement Plan members through the launch of four initiatives; GoHybrid, Enhanced Active Choice Splash Screen, SmartStep and the Paycheck Calculator. These initiatives resulted in an increased voluntary contribution savings rate in the defined contribution component of the plan – the Hybrid 457 Deferred Compensation Plan. The objective of each initiative was to motivate hybrid plan members to maximize voluntary contributions to receive the full employer matching contribution and provide additional retirement income to meet their future goals.
The GoHybrid feature is designed to allow newly-hired hybrid plan members to preset Hybrid 457 voluntary contribution amount before their employer enrolls them with VRS. With the enhanced active choice splash screen, VRS continued to encourage positive savings behaviors for hybrid plan members. Members who saw the message could choose to either save 4 percent now, choose an amount to save, or wait to save. The paycheck calculator allowed hybrid plan members to visualize making contributions to their retirement account on a pre-tax basis could have on their paycheck as part of the savings decision.
For those hybrid plan members who are unable to save the maximum 4 percent voluntary contribution to the Hybrid 457 Plan, the SmartStep feature makes it easier for members to opt-in to increase their voluntary contributions on an annual basis at an amount they choose.
As a result, hybrid plan members contributing the maximum percent to the Hybrid 457 Plan to receive the full employer match increased by 45 percent. Of the hybrid plan members utilizing the GoHybrid feature, 87.5 percent set their voluntary contribution deferral amount to the maximum 4 percent. The enhanced active choice splash screen had a positive effect on 96.5 percent of hybrid plan members who increased their voluntary contributions. Approximately 63 percent of members who saw the splash screen contributed the maximum of 4 percent. Usage of the paycheck calculator increased by 94 percent, as members visualized the impact saving could have on their paycheck.
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- August 7, 2019 Create Date
- January 8, 2020 Last Updated