your journey to financial well-being

Transcription

EARN WELLNESS POINTS | GAUGE YOUR SAVINGS | GET TO KNOW ROTH | USE YOUR BONUS TO SAVE | MAKE BUDGETING WORK | IMPORTANT REMINDERS
YOUR JOURNEY TO FINANCIAL WELL-BEING
Q4 2015
How’s your financial fitness?
Being financially fit is an important part of achieving optimal well-being.
Feeling anxious and stressed due to financial concerns can make it difficult
to be your best in all aspects of your life. It can also open the door to health
problems down the line.
As we move into a new year, it’s a good time to assess your financial health
to see if you are on track or if your plan needs fine-tuning. The tips and
resources in this guide can help.
FINANCIAL CONCERNS
WEIGHING ON YOUR MIND?
Get help by talking with a
counselor from our Employee
Assistance Program (EAP).
Call 1-800-563-4760, day
or night, to schedule a
confidential appointment. You
and your family members each
have five counseling visits per
issue per year at no cost.
Earn wellness points along the way
Participate in financial planning activities – such as a webinar or financial counseling session – and you can earn
up to four wellness points toward health plan premium credits if you are enrolled in The Hartford’s health plan.1
Start by visiting the Aycofn® website, complete a financial planning activity, then fill out a short affidavit on the
My Wellness at Work portal.
1
To be eligible to receive a health premium credit, you must be enrolled in The Hartford’s health plan. Plan members on long-term disability or COBRA
and employees in Hawaii are not eligible for health premium credits. In addition, to receive health premium credits after Q1 2016, you must complete
the health risk assessment, which becomes available January 2016.
FAST FACTS: SEE WHAT WE ACCOMPLISHED.
Together we’re learning how to get healthier – not just physically, financially too:
92
of employees are contributing to the
17
401(k)/Investment and Savings Plan (ISP)
Engines Online Advice Tool – at no cost
%
72
%
of employees contribute at least 6 percent
of their eligible pay to the ISP to receive
The Hartford’s full matching contribution
2
%
of employees have used the Financial
More than
6,000
employees have worked with an Ayco financial coach –
at no cost
ASSESS THE HEALTH OF YOUR FINANCIAL PLAN.
Gauge how much you
should save
When building your savings for now or down the road,
getting started is often half the battle. While there’s
satisfaction in knowing you’ve taken action – having a
goal will help you stay on track.
These resources can help you assess where you are
and define your short-term and long-term goals:
• Ayco financial coach – Reviews your financial
situation at no cost to you. Just call 1-866-217-8691.
• “Are you on course for retirement?” – View
this animated video on Aycofn® which provides
examples of the salary amount that may be needed
at retirement based on an individual’s age and
various assumptions.
• Financial Engine’s investment planning tools and
services – Provides information and tools to help you
meet your savings goals. After you log on to Fidelity
NetBenefits,® access the following resources by
clicking anywhere within the Financial Engines box
on the right side of the home page. Then select the
“Financial Engines” link.
»» Online Advice tool: Provides investment
advice for your 401(k)/Investment and Savings
Plan account at no cost to help you build your
investment strategy on your own. After you
reach the Financial Engines page, choose the
“Retirement Plan” tab and click “Get Advice” to
access your personalized retirement advice.
»» Professional Management Service: Invests your
ISP account for you for a fee. After you reach the
Financial Engines page, choose the “Retirement
Plan” tab and click “upgrade my service” at the
bottom of the page. Or talk to a Financial Engines
Advisor about Professional Management by
calling 1-800-601-5957.
A BENEFITS SNAPSHOT CAN HELP YOU PLAN
Having a complete view of your current financial
situation can help you determine where you want to
be. The My Total Rewards tool helps by estimating the
total possible value of your benefits at The Hartford,
including applicable cash and incentive compensation,
retirement savings, health and wellness, time off and
career and family support. Access the tool, which is
updated quarterly, on myHR.
Got 5 minutes? Get a
financial check-up
The 5 Minute Financial Check-up can help you
prioritize cash flow, debt management, investment
planning, taxes and more. Complete a short affidavit
on the wellness portal once you’ve completed the
check-up to receive one wellness point.
3
IS ROTH 401(k)
RIGHT FOR YOU?
THIS INFORMATION CAN HELP YOU DECIDE
The Hartford’s 401(k)/Investment and Savings Plan (ISP)
allows for Roth 401(k) contributions. What’s the difference
between these contributions and traditional 401(k)
contributions? And how do you select an approach that’s
best for you? The decision really comes down to whether
you want to pay income taxes now or later.
Here’s a breakdown:
• Traditional 401(k) = pay no taxes now: Your
contributions are deducted from your paycheck and
added to your ISP account before income taxes are
withheld, which lowers your taxable income. When you
withdraw the money in the future, you pay taxes on the
contributions and any associated investment earnings at
that time.
• Roth 401(k) = pay taxes now, not later: Your
contributions are deducted from your paycheck and
added to your ISP account after income taxes are
withheld. So, you pay the taxes upfront. But when you
withdraw the money in the future, you won’t need to
pay any taxes on the distribution or the associated
investment earnings as long as the withdrawal is
considered a qualified distribution.2
Traditional (before-tax) contributions may work better
if you think you’ll be in a lower tax bracket3 when you
begin receiving your retirement savings. Generally, Roth
contributions may be more advantageous if you think you’ll
be in a higher tax bracket during retirement. Why? Because
it’s better to pay, for example, a 25 percent tax rate on
your contributions now than a 35 percent tax rate on your
contributions and any associated investment earnings in
the future.
UPDATE YOUR CONTRIBUTIONS ANY TIME
Go to NetBenefits® and choose the Quick Links menu
under the ISP. Then select “Contribution Amount.”
Only “qualified distributions” are not subject to federal income tax. A qualified distribution is one that is taken at least five years after the year of your
first Roth Contribution and after you have attained age 59½, become disabled or die. If your distribution is not a qualified distribution, you will be taxed
on the Roth 401(k) contributions earnings when they are distributed.
2
Federal and state tax rates are subject to change and can vary depending on income and filing status. Consult with your tax advisor or Ayco coach
about your personal tax situation and for help determining which contribution type may be more appropriate for you.
3
ROTH 401(k)
$8,000
$10,000
TRADITIONAL 401(k)
4
You don’t have to choose one or the other
Obviously, it’s difficult to predict what tax rates will be in the future. But tax
diversifying – or spreading your investments across tax-deferred and tax-free accounts
– is a strategy that you might consider to help manage tax obligations in retirement. To
hedge your bets, you can make both traditional 401(k) and Roth 401(k) contributions
at the same time, up to a combined limit set by the Internal Revenue Service.
The Roth Modeler on NetBenefits can help you understand the differences between
Roth 401(k) (after-tax) contributions and traditional 401(k) (before-tax) contributions.
After you log on, go to the “Planning” tab to access the Roth Modeler.
For personal guidance, call an Ayco financial coach – at no cost to you –
at 1-866-217-8691.
continued
NEW FOR 2016: CONVERT EXISTING SAVINGS TO A ROTH 401(k).
If you’d prefer to pay taxes on your existing traditional
401(k)/Investment and Savings Plan (ISP) savings
now instead of when the money is withdrawn in the
future, an enhanced feature will be available next year
to help you do so.
As of Jan. 1, you may be able to take advantage of
an expanded in-plan Roth conversion feature, which
allows you to convert eligible ISP savings to a Roth
401(k) account as long as they are vested, even if that
money was initially contributed on a before-tax basis.
Currently, an in-plan Roth conversion is only allowed
for money that is considered distributable. Generally,
that means the employee is 59½ or older; the money
was contributed on an after-tax basis; or the money
was rolled over from another 401(k) plan.
SAVINGS
5

If you have questions about how this type of
conversion works, an Ayco financial coach can help
you at 1-866-217-8691.
To set up an in-plan Roth conversion, call the
HR Service Center at 1-877-HR-AT-WORK
(1-877-472-8967) from 8:30 a.m. to midnight ET.
Keep in mind, you will need to find other cash to
pay taxes on any money you convert. Tax payments
cannot be made from your account balance – consult
with your tax advisor first.
ROTH 401(k)
BOOST YOUR
SAVINGS WITH
YOUR BONUS.
INCREASE YOUR SAVING POWER
If you receive an annual bonus, it will be easier for you
to manage how much of it is contributed to your 401(k)/
Investment and Savings Plan (ISP) account in 2016.
As of Jan. 1, you will be able to elect a separate contribution percentage4 for your bonus,5 which is typically
paid in March.
As with the regular ISP contribution, The Hartford will
continue to match your separate bonus contribution
percentage up to 6 percent of your eligible pay and
contribute 2 percent of your eligible pay on a nonelective basis.
HOW TO SET UP A BONUS
CONTRIBUTION PERCENTAGE
In the past, your regular ongoing ISP contribution
percentage applied to your bonus. This means the
percentage you chose to have deducted for your ISP
account each pay period was also deducted from your
bonus check.
As of Jan. 1, employees who are eligible for an
annual bonus can log on to NetBenefits and click on
“Contribution Amount” in the Quick Links menu under
ISP. In setting up your bonus5 contribution, keep the
following points in mind:
Starting in 2016, you can change how much you
contribute from the bonus without changing your
regular ongoing ISP contribution percentage. With a
separate bonus election, you can contribute more and
give your ISP account a boost. Or conversely, you can
reduce the amount you are contributing.
You can choose to make traditional (before-tax), Roth
and/or after-tax contributions from your bonus. Your
investment fund options will follow those you’ve
chosen for your regular, ongoing ISP contributions
each paycheck.
What happens if you don’t set up a separate bonus
contribution percentage?
If you don’t specify a separate contribution percentage
for your annual bonus,5 the contribution percentage for
your regular, ongoing ISP contribution will apply to your
bonus amount. The contribution will also be made in the
same way (before-tax, Roth or after-tax) and allocated to
the same investment options.
Your regular, ongoing ISP contribution percentage
will remain the same in 2016 (as it is in 2015), unless
you change it or participate in the automatic increase
program.
6
Any changes, including a new bonus contribution
percentage election, may take one to two pay periods
to go into effect. As a result, be sure to elect your
new bonus contribution election early (e.g., by the
end of January) to ensure that the election applies to
any eligible annual bonus you receive.
Separate contribution percentages are not available for traditional ISP
catch-up and/or Roth catch-up contributions. More information about
ISP contribution types is available in the Summary Plan Description on
NetBenefits.
4
5
If you participate in the automatic increase program (which increases
your contribution to the ISP by 1% each year), the automatic increase
will no longer apply to the annual bonus.
Note: Your ISP contributions are subject to IRS guidelines
and limitations. Bonus contribution elections cannot be made
retrospectively.
LOOK FOR WAYS TO SAVE ON
EVERYDAY COSTS.
Common budgeting setbacks and solutions
A budget is critical to the
success of your financial
plan. Yet many people
either don’t have a budget
or aren’t sticking with it.
For budgeting guidance,
call an Ayco financial
coach – at no cost to you –
at 1-866-217-8691.
This article previously appeared
in the September 2014 edition of
Ayco’s Updates Newsletter.
Here are some of the most common reasons why budgeting sometimes fails and
likely solutions:
REASON 1 — You don’t look at your budget regularly.
The fix: Revisit your budget every pay period, or more often if necessary, to compare planned
expenses against actual ones. As you gain more experience with your budget, you may be
able to revisit it less often.
REASON 2 — Your goals aren’t front and center. It takes motivation and willpower to stick to
a budget and, without a good reason to cut spending or set limits, we generally won’t do it.
The fix: Setting smaller sub-goals might help. Also, write your goals down — and keep them
where you can see them.
REASON 3 — Your budget is incomplete. One of the most common mistakes is to not
include every expense in your budget.
The fix: Take a mental “walk” through your home and your day and list everything that costs
money, even if only occasionally, such as insurance bills, oil changes, gifts, routine home
maintenance or kids’ activities. You may end up with a long list of expenses, many of which
are irregular. That’s OK; you’ll make a plan for those so they don’t throw you off track.
SAVE ON YOUR COMMUTING COSTS
If you work 20 or more hours per week, you can use before-tax dollars to pay for qualified parking and transportation
costs through the Commuter Benefit Program. To enroll, log on to acclarisonline.com and click on Elect/Modify
Commuter Benefits. A new window will open and you can place an order there.
Here’s what employees of The Hartford helped save this year, on average, with this program:6
Gas money saved by employees:
Pounds of CO2:
Employee tax savings:
Number of cars off the road:
$379,384
$76,331
260,346.68
194
Estimates based on the average order amounts reported above, employer payroll tax savings at 8 percent and employee
payroll tax savings of 30 percent. Savings are annualized estimates.
6
7
TAKE NOTE:
IMPORTANT REMINDERS.
ACTION NEEDED: CHECK YOUR
DEPENDENT INFORMATION
Starting this year, The Hartford is required
to send a new tax form, called a Form 1095-C
Employer-Provided Health Insurance Offer and
Coverage, to employees. The form indicates
if employer-sponsored health coverage was
offered to you and your dependents for 2015,
and specifies if you elected that coverage for
yourself and/or dependents. Depending on
your circumstances, you could be eligible for a
health exchange subsidy or owe a penalty for
not having health coverage.
You will receive the form by the end of January
2016 and you should keep it for your 2015
federal income tax filing.
 ACTION REQUIRED
It’s important to make sure the information that will be on the Form 1095-C
is correct. Log on to NetBenefits by Dec. 24, 2015, to update or confirm the
accuracy of the first/last name, date of birth and Social Security Number for
your covered spouse/dependent(s).
After you log on, follow these steps:
1. Select “Profile” at the top of the page
2. Under “Related tasks” click on “Dependents for your Health Insurance”
3. Once you see dependents listed, click “Update” next to the dependent
4. To review or edit your dependents’ Social Security Number (SSN) click
inside the SSN box so the complete number will display.
You can also update names online. However, to change date of birth or
relationship status, you must call the HR Service Center at 1-877-HR-AT-WORK
(1-877-472-8967).
USE YOUR FSA MONEY BEFORE YOU LOSE IT
A Flexible Spending Account (FSA) helps you save for
your eligible health and dependent care expenses on a
before-tax basis. But remember, if you don’t use the FSA
money by Dec. 31, 2015 – and submit your claims by
March 31, 2016 – you will forfeit it.
The Hartford offers two types of FSAs – a Health Care
Spending Account (HCSA) and a Dependent Day Care
Spending Account (DCSA). Here are some examples of
eligible expenses for each:
1. HCSA – pay for expenses like deductibles, copays,
eyeglasses, LASIK eye surgery, acupuncture and more.
2. DCSA – pay for dependent day care expenses – at an
outside facility or in your home – for services such
as elder care, or day care or summer day camp for
children under age 13.
New FSA Bank Card on the Way
If you elected an HCSA for 2016, you will receive a new
VISA® debit card from Bancorp by U.S. mail in midDecember. You must activate your card before you
can use it.
You will receive more information with the card.
Review the Well-Being e-Book to see the many ways The Hartford can help you
on your journey to a life well lived.
Aycofn® is a trademark of The Ayco Company, L.P., a Goldman Sachs Company. This service is provided exclusively by
The Ayco Company, L.P. Used with permission. The Ayco Company, L.P., (Ayco) is a subsidiary of The Goldman Sachs
Group, Inc. and an affiliate of Goldman, Sachs & Co., a worldwide, full-service investment banking, broker-dealer and
asset management organization.
ABOUT THIS ISSUE
This guide is not intended to create, nor will it be construed to form, a contract or promise for a benefit. Participation
in the plans is subject to all applicable terms and conditions of the plans. Full details about the plans are provided in
the official Plan Documents, which govern the operation of the plans. Any differences between this guide and the Plan
Documents are not intended, but if any differences are found to exist, the Plan Documents will govern. The Hartford
reserves the right, without your consent or concurrence, to amend, modify, suspend, replace or terminate the plans, in
whole or in part, including any level or form of coverage or contribution amount, at any time.
15-1041 Benefits Resources © December 2015 The Hartford Financial Services Group, Inc. All rights reserved.

your journey to financial well-being

Transcription

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