Fulton County Government
TOTAL PLAN ASSETS/PARTICIPANTS: $434.5 million/5,155 for the 401(k); $103.8 million/1,778 for the 457
PARTICIPATION RATE: 100% for the mandatory 401(k); 34.5% for the 457
AVERAGE DEFERRAL RATE: 6% for the 401(k); 4.6% for the 457
EMPLOYER CONTRIBUTION: 8% for the 401(k), plus 50% on 4% for the 457
“When you look at retirement plan statistics nationally, many employers match something like 50% on the dollar, up to 6%,” says Don May, a member of the Fulton County, Georgia, government’s retirement plans committee. “Here at Fulton County, we have a mandatory 401(k) plan and a voluntary 457 plan.” The county previously froze its defined benefit (DB) plan, he notes. For the 401(k), Fulton County contributes 8%, and the employee is required to contribute 6%. “So you get 14% retirement savings just for being an employee here: That’s on autopilot,” says May, systems analyst III for Fulton County. Additionally, if an employee contributes to the 457, the employer County matches 50% up to 4% of their contribution.”
“I’ve had a lot of people tell me, ‘Man, that’s unheard of,” he says, of his co-workers. “They say, ‘I’ve never worked for an employer that has provided that type of contribution.’” Between the 401(k) and the 457, an employee deferring 10% receives a 20% total contribution, with the employer contributing 10%. The high contribution rates have played a big role in 95% of Fulton County employees being on track to replace 75% or more of their income in retirement.
Fulton County puts considerable emphasis on individualized employee education, and its recordkeeper, MassMutual Financial Group, has a retirement education specialist on-site full time at the county government’s headquarters building, in Atlanta. Fulton County and MassMutual take several steps to actively encourage employees to talk with a MassMutual education specialist, either in person or by phone, including urging county managers to take responsibility for ensuring their employees make an appointment with the provider.
The on-site MassMutual specialist, Angela Hobbs, spends about half of her time at Fulton County’s headquarters and the other half between the county’s more than 40 locations.
Hobbs had 461 one-on-one meetings with Fulton County employees last year, up 15.8% from 398 in 2015. Also taking participants’ phone conversations with MassMutual call center education specialists into account, participants had 9,362 one-on-one conversations with MassMutual last year, up 29.6% from 7,226 in 2015. “It is difficult to get to everybody,” Hobbs says of the more than 5,000 employees. “But I have been working with the plans for eight years, and we definitely are making progress, year over year.”
Fulton County does have some challenges with its participants, though. Last year, American Century Investments did a plan-health report for the committee—Fulton County uses a mid-cap fund on its investment menu—and it included a scatter diagram plotting how participants’ equity allocations by age match up to that asset manager’s equity allocations in its target-date fund (TDF) glide path. That gave the committee a better sense of how appropriately allocated participants were for their age.
The American Century Investments plan-health report “was very eye-opening for us as a committee,” May says. “One of the things we’ve been discussing is to re-enroll everyone in Vanguard target-date funds, and we are going to consider that this year. —Judy Ward