Most of us have been hearing about "Brexit" in the news. "Brexit" is an abbreviation of "British exit," which refers to the June 23, 2016 referendum vote by British voters to exit the European Union. This decision has had an impact on markets around the world, you might hear of this impact referred to as "market volatility."
What does this mean for your retirement investments and savings? Stocks overall have historically outperformed other major asset classes (balanced funds, bonds, cash and equivalents), but with much greater volatility, especially over shorter time periods. The chart below depicts the highest and lowest performance since 1926 for different portfolios over rolling 1, 5, 10, and 20 year periods. For example, stocks over a one-year period have ranged from a 163 percent gain to a 68 percent loss, while over rolling 20-year periods they have returned as much as 18 percent and have not had a negative return. When the stock and bond markets are experiencing significant volatility, remember that volatility is likely to lessen when viewed over longer time periods. The challenge is that the longer riskier investments are owned, the higher the chance of experiencing a severe down market that can set you back. Meanwhile, timing when market swings occur is extraordinarily difficult. Avoiding stocks may not provide enough growth and protection from inflation over time, but avoiding more conservative fixed-income investments might expose you to too much risk. In addition to your time horizon and comfort level with risk, there are other factors to consider. How dependent will you be on your investments? How much flexibility do you have to adjust your spending, or draw down other income sources if your portfolio performance suffers? Finding the right mix of different types of investments, based on your circumstances, is key.
The District's goal is to assist you in building retirement security. Your investment professionals at ICMA-RC, the third-party recordkeeper for your District of Columbia retirement plan, are closely monitoring the recent stock market volatility. While no one can control the market's ups and downs, there are a few things you can do as you invest for goals such as having enough money saved to last throughout your retirement. Resources:
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How to Enroll in the 457(b) Deferred Compensation Plan
Your 457(b) Plan is a great way to help you save more for your retirement. It's easy to enroll in the plan:
- Visit the plan website to download an Enrollment Kit.
- Set up a one-on-one appointment with a plan representative: You may register online for a meeting. Your rep can talk with you in detail about the 457(b) Plan and answer any questions, in addition to making sure your account is all set up.
- Attend a group seminar: Browse upcoming seminars to pick a topic, then register online to attend. A plan representative can help you enroll when you are at the seminar.
- Visit a local service center:
- ICMA-RC, 77 K St. NE, 8th Floor, Washington, DC 20001; 202-759-7190
- One Judiciary Square, 441 4th St. NW, Suite 340N, Washington, DC 20001; 202-442-9749 or 202-442-9640
All completed forms should be submitted directly to the DC Department of Human Resources (DCHR). You may drop off your completed form at the office (see address below), email it to dchr.benefits@dc.gov, or fax it to: 202-727-9070.
One Judiciary Square
441 4th Street, NW, Suite 340N
Washington, DC 20001
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Celebrate Financial Wellness
Grab your Passport to Financial Wellness and take a journey to financial wellness and retirement preparedness. If you get four stamps, you could bring home exciting souvenirs! (See information about prizes below.)
1.To participate in the program, you'll attend two mandatory education seminars (you can pick up your passport at any of the program's seminars):
- 401(a) Educational Seminar
- 457(b) Educational Seminar
2. To get your passport properly "stamped," you'll also pick two more investment seminars to attend. Your choices include the following:
Juggling Financial Goals
- Learn about how to save for multiple things -- a house, car, college, emergency fund, retirement.
- Paying down debt.
- Basic steps to help you organize and reach your goals.
Get to Know Your Roth Options (about the Roth, or after-tax, contributions option)
- Learn about Roth contributions and conversions, which give you another tax-advantaged option in your 457 plan.
- Discover how Roth 457 helps you benefit from tax-free withdrawals.
- Evaluate whether Roth makes sense for you.
Your Saving and Investing Goals
- Learn how to set goals related to how much you save
- Set goals for how you invest
- Explore how to make these goals more realistic for you
Build Your Investment Portfolio
- Discuss approaches to selecting your investments.
- Review strategies that can help you with these choices.
- Find the right balance of risk and reward in a diversified portfolio.
3. To register for the seminars:
- Register on PeopleSoft Log in and select PeopleSoft Employee Self Service. Under Main Menu, click Self Service, then Learning and Development, thenRequest Training Enrollment, then Search by Course Number or Search by Course Name. Enter the session name or course number, select View Available Sessions, and select a date.
- Register at your agency HR Department.
- View the schedule of seminars.
4. Pick up a passport.
5. Turn in your passport to be eligible for giveaways! Return your passport to a local service office (visit www.dcretire.com and click Contacts for locations).
- Get four stamps in your passport, and you'll receive a USB charger for your smartphone!
- Get four or more stamps in your passport to be entered into the Grand Prize drawing!
- One winner will receive an iPad!
- Five winners will receive FitBits!
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ICMA-RC Representatives: We're Here to Help
Phone:
(202) 442-9749 or
(202) 442-9640
If you have general account questions, you may also contact an Investor Services Representative at:
1 (800) 669-7400
*press 0 to speak with a representative
Representatives are available Monday through Friday from 8:30 a.m. to 9:00 p.m. ET.
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