North Carolina State Employees’ Credit Union

The North Carolina State Employees’ Credit Union was founded in 1937, with 17 members and $437 in assets. NCSECU has since grown to $50 billion in assets and serves over 2.7 million members from 270 branch locations throughout North Carolina.

The institution, headquartered in Raleigh offers a 401(k) plan for all employees, plus a 457(b) deferred compensation plan for highly compensated staff. The combined plans held roughly $1.3 billion in assets for the 10,002 participants as of year-end 2023. The 401(k) has a 98% participation rate, which isn’t surprising given its match structure. “The organization offers an incredibly generous match on contributions—200% of up to 5%, for a total of 10% if a participant contributes 5%. This is coupled with an automatic enrollment and automatic escalation program,” says Abigail Russell, senior vice-president with its adviser CAPTRUST. “The end result is high plan participation and high average deferral rates.”

According to Tim Byrd, vice president, retirement benefits and education with the credit union, its leaders wanted their human resources department to do more for participants than basic plan administration. NCSECU already had a financial advisory service registered as an investment adviser with the state of North Carolina for members and employees. Management wanted to provide participants with financial advice and education, which led to NCSECU building an HR team with multiple professional personal finance and plan-related certifications. “I truly think that’s what separates and differentiates us from most employer-sponsored administrators,” Byrd says.

NCSECU develops its financial education materials and presentations internally plus uses resources from Fidelity Investments. New hires attend a live 401(k) presentation during their orientation. Byrd’s department also created a seminar series that provides additional 401(k) plan details.

One-day retirement readiness seminars cover multiple topics, ranging from Social Security claiming strategies to estate planning. The program is designed for those within five years of retirement, but any employee may attend. Besides helping employees save and plan for retirement, NCSECU gives retirees a $12,500 life insurance policy and access to health insurance, with a $500 monthly subsidy to offset premiums.

Managing plan withdrawals can be a challenge for retirees. NCSECU allowed retired employees to specify a regular withdrawal amount, but, as Byrd notes, that arrangement didn’t always help people trying to stretch their savings throughout retirement. Consequently, when Fidelity, the plan’s recordkeeper, offered additional withdrawal options last year, NCSECU signed up. The new options include a fixed percentage of the participant’s balance, a fixed period for distributing the balance and a required minimum distribution option based on a life expectancy table. “Those were easy options to adopt, and immediately the retirement plan committee saw that as an opportunity and we adopted those,” Byrd says. “So now there are four different types of systematic withdrawals that are good foundational basics that could benefit many participants.”

CAPTRUST has worked with NCSECU since 2016, and Russell praises the credit union’s work with its retirement plans. “They have consistently gone above their fiduciary duty to do the right thing for their people, to help them retire with more money or retire sooner.”

—Ed McCarthy