Total Retirement Offering (TRO)

Hudson Valley Credit Union

Plansponsor of the year winner icon WINNER
Poughkeepsie, New York
Diane M. Allenbaugh
Senior Vice President, Human Resources
  • Plans
    401(k); 457(b); 457(f); frozen defined benefit
  • Total Plan Assets
    $71.9MM in 401(k); $1.2MM in 457(b); $0.6MM in 457(f); $78.6MM in DB
  • Number of Participants
    743 in 401(k); 20 in 457(b); 3 in 457(f); 695 in DB
  • Participation Rate
    97.5% for 401(k)
  • Average Deferral Rate
    6.6% for 401(k); 12% for 457(b)
  • Default Deferral Rate
  • Default Investment
    Janus Henderson Balance T Fund
  • Automatic Enrollment
  • Automatic Escalation
  • Employer Contribution
    50% of 6% + 2% to 4% nonelective contribution depending on length of service
  • Providers
    Recordkeepers: Principal Financial Group for DC, Pentegra for DB; Adviser: NFP
  • Financial Wellness Educators
    Principal Financial Group, NFP

Hudson Valley Credit Union maintains a strong overall retirement offering for its employees, including 401(k), 457(b), 457(f) and defined benefit pension plans.

In 2011, HVCU instituted a soft freeze to the pension plan. Employees hired after that date were eligible for an increased 401(k) match.

Diane M. Allenbaugh, senior vice president of human resources and organizational development, says HVCU discussed structuring the 401(k) plan after the DB plan was frozen so that new hires would meet a target income replacement ratio similar to that of employees who had the pension. They determined that employees hired after the DB plan was frozen would get a 75% match of 6% of deferrals.

However, when doing another analysis in 2018, she says, HVCU discovered that those employees still wouldn’t get to the set target income replacement rate of 70%, and it was difficult for some employees to even save at all. HVCU decided to change the employer match to 50% of 6% of deferrals and offer an employer nonelective contribution of 2% to 4%, depending on years of service.

The credit union has already announced that the DB plan will close as of Dec. 31, 2023. Allenbaugh says all DB plan participants will get a 4% nonelective contribution, because the service requirement to get 4% is seven years.

Despite the DB plan closing, it is still an important part of employees’ retirement benefits. Agnes Covell, assistant vice president of total rewards, says employees get a total rewards statement that HVCU designed with payroll provider ADP. Although employees’ pension benefits are not stored on the ADP platform, each employee’s estimated DB plan benefit is included on the statement.

At HVCU’s annual wellness fair, benefit vendors, including the DB and DC plan providers, are there for employees and their spouses/partners to meet with them. All employees get a point-in-time financial wellness check and are given steps they need to take to reach their goals. “We think of health as including financial and emotional health as well as physical,” Allenbaugh says.

Outside of the wellness fair, HVCU offers regularly scheduled meetings during which employees can meet with representatives from both the DB and DC plan providers to help with financial and retirement planning.

HVCU doesn’t leave employees hanging at retirement. Covell says that about four years ago, she created a health and retirement compliance analyst position “because we were lacking in that area of just focusing on ‘at retirement.’ We have an aging population, so it was a definite need.” The position was filled by Sardo Lebron.

“When an employee reaches out to her—and they don’t have to be actually retiring; they can be several years from it—she schedules a one-on-one planning session, where employees receive a pension benefit estimate and a retirement planning checklist,” Covell says. “Employees are given information about benefits at HVCU, as well as information about Social Security and Medicare. They are also told about our employee assistance program, because some people might have an emotional time adjusting to retirement.”

Spouses/partners can be included in the planning sessions, and employees and their spouses/partners are also offered opportunities to meet with representatives of the DC and DB plan providers.

Covell adds that, since the credit union is a financial services entity, it offers wealth management. Employees can also meet with someone in wealth management to help them plan for distributions/retirement income. Between 90% and 95% of retirees use this service.

For after-retirement questions and needs, HVCU has an Intranet portal just for retirees that provides regular communications, says Covell. The credit union also reaches out to schedule talks with retirees during open enrollment. Retirees are part of open enrollment because HVCU offers retiree health care. “If a retiree is younger than 65, he can remain on our regular company health plan,” Covell explains. “When 65 or older they have Medicare, and we offer a MediBlue Gap Plan. In addition, retirees are given a $300 per month stipend toward the cost of health care and a $10,000 life insurance policy at no cost to them.”

Covell says there are currently more than 70 retirees, and the human resources staff maintains personal contact and follows up with each retiree individually throughout the year, and especially during open enrollment.

Rebecca Moore

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