Invest in you and help build your retirement nest egg! Your Fidelity Retirement Plan Transition Guide Look inside for important information about upcoming changes.
Important notice concerning your rights under the Memorial Hermann Health System 403(b) and 401(k) Retirement Plans. This notice is to inform you that the recordkeeping services for the Plans will transfer to Fidelity Investments.
Welcome to Fidelity Investments Starting June 1, Fidelity Investments© will be our new Retirement Savings Plan service provider. Review this guide to learn all you need to know about the upcoming change.
WHAT’S INSIDE 2 What’s new, what’s not
It’s time to invest in my future!
3 Planning ahead for key dates 5 Your investment options 11 Tools and resources 12 Your action checklist
Contact information Know who to call and when during the transition! Principal (Available before May 20 at 3:00 p.m. CT) Principal Financial Call Center
1.800.547.7754
Principal Website
www.principal.com
Fidelity (Available week of June 19) Fidelity Retirement Service Center
1.800.343.0860
NetBenefits®
www.netbenefits.com/mhhs
Special Note: If you are a former employee, alternate payee or beneficiary with an account balance in the Plan, some of the information enclosed may not apply to you. However, you will be affected by the upcoming transition, so read this material carefully.
Breaking down what’s new, what’s not When Fidelity becomes our new service provider, we’ll provide a new level of service to help you invest in yourself and your future.
WHAT’S NEW
WHAT’S NOT
Annual Increase Program
Put your contributions on auto pilot: An optional service to automatically increase your contributions each year
Fidelity BrokerageLink® 1
More choices: Access to additional mutual fund investment choices for your retirement savings
Fidelity® Portfolio Advisory Service at Work
Additional support: A managed account service offering professional investment management of your account 2
Rebalance Notification
Contact when it counts: Email notifications any time your account’s investment mix strays from your original strategy
Online Beneficiary Elections
Convenience: Your current beneficiary information will not transfer to Fidelity. When the transition to Fidelity is complete, you will need to designate your beneficiaries
Education and guidance: Knowledgeable professionals are Workplace Planning and Guidance Support available to help you take your savings to the next level
Investor Centers
Payroll Contributions
Your contribution rate as of May 20 continues and transfers to Fidelity. You don’t need to re-enroll in the Plan
Employer Match
The Memorial Hermann match continues and transfers to Fidelity
Outstanding Loans
Any outstanding loan balances transfer to Fidelity. The transition won’t affect the terms or length of your loan 3 Full and part-time employees: You will continue to repay your loans through payroll deductions Supplemental employees: You will repay your loans through ACH payments from your bank account. Fidelity will send additional instructions on how to set up your ACH payment information when the transition is complete in June
Face-to-face interaction: Fidelity has more than 180 Investor Centers across the country, including seven in the Houston area
You could lose money by investing in a money market fund. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Fidelity Investments and its affiliates, the fund’s sponsor, have no legal obligation to provide financial support to money market funds and you should not expect that the sponsor will provide financial support to the fund at any time. Fidelity’s government and U.S. Treasury money market funds will not impose a fee upon the sale of your shares, nor temporarily suspend your ability to sell shares if the fund’s weekly liquid assets fall below 30% of its total assets because of market conditions or other factors. 1
BrokerageLink includes investments beyond those in your Plan’s lineup. Memorial Hermann neither evaluates nor monitors the investments available through BrokerageLink. It is your responsibility to ensure the investments you select are suitable for your situation, including your goals, time horizon and risk tolerance. See the fact sheet and commission schedule available on NetBenefits for applicable fees and risks.
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Fidelity® Portfolio Advisory Service at Work is a service of Strategic Advisers, Inc., a registered investment adviser and a Fidelity Investments company. This service provides discretionary money management for a fee. Loan repayments received during the blackout period are invested in the Fidelity®Money Market Trust Retirement Government Money Market Portfolio until the blackout period ends. At that time, loan repayments and any associated earnings are posted to your account according to your investment elections on file with Fidelity. If you do not have any elections on file, your loan repayments and any associated earnings are invested in a Vanguard Institutional Target Retirement Date Fund Institutional Shares.
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Planning ahead for key dates To ensure all information is transferred accurately from your current plan account at Principal to Fidelity, there will be a period of time when you will be unable to direct or diversify investments in your individual accounts, obtain a loan from the Plan or obtain a distribution from the Plan. This period during which you will be unable to exercise these rights otherwise available under the Plan is called a “blackout period.” Carefully consider how this blackout period may affect your retirement planning, as well as your overall financial plan. The blackout period for the Plan is expected to begin on May 20 and end during the week of June 19. During these weeks, you can determine whether the blackout period has started or ended by contacting the Fidelity Retirement Service Center. During the blackout period, you will be unable to direct or diversify the assets held in your Plan account. It is very important that you review and consider the appropriateness of your current investments in light of your inability to direct or diversify those investments during the blackout period. For your long-term retirement security, you should give careful consideration to the importance of a well-balanced and diversified investment portfolio, taking into account all of your assets, income and investments. If you have any questions concerning this blackout, contact the Fidelity Retirement Service Center.
Available
June 19
If you would like to make any changes to your account at Principal before the start of the blackout period, go to the Principal website or call the Principal Call Center before May 20 at 3 p.m. CT. The effective date of Plan changes and the end of the transition period depend upon the accurate, timely transfer of data. If this does not occur, the delivery of services and investment options described in this brochure could be delayed.
week of
Get started online
at NetBenefits® to:
Set up your username and password Review your account balances Enroll in the Plan Request changes to your account
Good to know!
Access investment option descriptions The Fidelity Retirement Service Center is also available to assist and answer any questions at 1.800.343.0860.
Research investment performance Request a loan or distribution Designate your beneficiaries
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MAY
May 20
May 31
3 p.m. CT
3 p.m. CT
BLACKOUT PERIOD BEGINS
Your account balances are valued at the close of the market.
Today is the last day at Principal you can:
During the Blackout Period:
• Enroll in the Plan
• Your contributions continue at your elected percentage and continue to be invested
• Request a loan or distribution • Change your future contribution rate and how contributions are invested
JUNE
• Request an exchange between investment options
The process of moving your investments to Fidelity begins.
• Employer match will continue to be invested • Loan repayments will continue and be invested
June 1
Week of June 19
The account balance transition begins and requires reconciling all accounts before the blackout period ends. Review “Your Investment Options” on page 5 to learn how your investments may change.
BLACKOUT PERIOD ENDS
Your accounts will transfer to Fidelity on June 1. You will be able to view and/or transact on them once the Blackout Period is over.
• NetBenefits website is open • Fidelity Retirement Service Center opens • You can set up your account and designate beneficiaries • You can review account balances
JULY
• Request changes to your account
July 1- 31 Your final account statement from Principal is mailed to you.
I better mark my calendar!
Your first Fidelity statement is available online. Compare your final account statement from Principal to your new statement from Fidelity. Contact Fidelity with any questions.
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Your investment options CHOICES, CHOICES, CHOICES Before investing, consider the investment objectives, risks, charges and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.
Want more help?
The new investment lineup gives you the power to choose investment options that can help you meet your retirement financial goals.
See Page 9 for information on the Fidelity Portfolio Advisory Service.
You will have four options. So whether you are a novice or an expert, there’s an investment option for you.1
TIER 1
TIER 2
TIER 3
TIER 4
Target Retirement Date Funds
Passively Managed Core Investment Options
Actively Managed Core Investment Options
Fidelity BrokerageLink®
“I feel more comfortable with an investing approach based on a target retirement date.”
“I want to pick my own investments, but I want them to be tied to a specific market index.”
“I’m comfortable managing my own investments.”
“I want more options so I can customize them based on my goals.”
You want to choose from investment options that represent a variety of styles through several investment companies. You have the flexibility to build a strategy that meets your long- and short-term needs.
You want to invest in a broad range of mutual fund options beyond those offered through the Plan. Fidelity BrokerageLink®lets you build a retirement portfolio that’s more tailored to your individual goals.
This plan might be for you if… You plan to retire around the year indicated in the fund’s name. The investment strategy becomes more conservative as it approaches the target date and beyond.
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You want to choose and maintain the mix of investments. Index options aren’t actively managed, and they track the performance of a specific stock or bond index.
See page 10 for details regarding your default investment options.
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Your MHHS Retirement Plan investment lineup as of June 1 Tier 1 Target Date Retirement Funds TARGET DATE INVESTMENT OPTIONS
TICKER SYMBOL
Vanguard Institutional Target Retirement Income Fund Institutional Shares
VITRX
Vanguard Institutional Target Retirement 2010 Fund Institutional Shares
VIRTX
Vanguard Institutional Target Retirement 2015 Fund Institutional Shares
VITVX
Vanguard Institutional Target Retirement 2020 Fund Institutional Shares
VITWX
Vanguard Institutional Target Retirement 2025 Fund Institutional Shares
VRIVX
Vanguard Institutional Target Retirement 2030 Fund Institutional Shares
VTTWX
Vanguard Institutional Target Retirement 2035 Fund Institutional Shares
VITFX
Vanguard Institutional Target Retirement 2040 Fund Institutional Shares
VIRSX
Vanguard Institutional Target Retirement 2045 Fund Institutional Shares
VITLX
Vanguard Institutional Target Retirement 2050 Fund Institutional Shares
VTRLX
Vanguard Institutional Target Retirement 2055 Fund Institutional Shares
VIVLX
Vanguard Institutional Target Retirement 2060 Fund Institutional Shares
VILVX
Note: New investment options being added to the Plan are labeled with a yellow circle.
Tier 2 Passively Managed Core Investment Options STOCK INVESTMENT OPTIONS
TICKER SYMBOL
Vanguard Institutional Index Fund Institutional Shares
VINIX
Vanguard Total International Stock Index Fund Admiral Shares
VTIAX
Vanguard Total Stock Market Index Fund Institutional Plus Shares
VSMPX
BOND INVESTMENT OPTIONS
TICKER SYMBOL
Vanguard Total Bond Market Index Fund Institutional Shares
VBTIX
Vanguard Total International Bond Index Fund Admiral™ Shares
VTABX
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Tier 3 Actively Managed Core Investment Options STOCK INVESTMENT OPTIONS
TICKER SYMBOL
DFA U.S. Small Cap Portfolio Institutional Class
DFSTX
Dodge & Cox International Stock Fund
DODFX
Natixis Funds Trust II Vaughan Nelson Value Opportunity Fund Class N
VNVNX
BOND INVESTMENT OPTION
TICKER SYMBOL
Baird Core Plus Bond Fund Class Institutional
BCOIX
SHORT-TERM INVESTMENT OPTION
TICKER SYMBOL
Vanguard Federal Money Market Fund Investor Shares
VMFXX
Tier 4 Brokerage Option INVESTMENT ALTERNATIVE
Fidelity BrokerageLink® The Plan is intended to be a participant-directed plan as described in Section 404(c) of ERISA, which means fiduciaries of the Plan are ordinarily relieved of liability for any losses that are the direct and necessary result of investment instructions given by a participant or beneficiary.
Your investment options WHAT’S CHANGING?
Note: New investment options being added to the Plan are labeled with a yellow circle.
When the market closes (generally 3 p.m. CT) on May 31, several investment options currently offered through the Plan will no longer be available. As a result, current account balances and future contributions will transfer to the new investment options on June 1 unless you direct otherwise by making changes to your account before May 20. Once the blackout period has ended (expected to be the week of June 19), all Plan services will be available, including the ability to make investment exchanges within your account.
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Existing Investment Option with Principal
New Investment Option with Fidelity
AS OF 3 P.M. CT ON MAY 31
EFFECTIVE AT CLOSE OF BUSINESS ON JUNE 1
Dreyfus Appreciation Fund, Inc. Class Investor
Vanguard Total Stock Market Index Fund Institutional Plus Shares
T. Rowe Price Institutional Large Cap Growth Fund
Vanguard Total Stock Market Index Fund Institutional Plus Shares
Dodge & Cox Stock Fund
Vanguard Total Stock Market Index Fund Institutional Plus Shares
Vanguard Mid-Cap Index Fund Institutional Shares
Vanguard Total Stock Market Index Fund Institutional Plus Shares
Columbia Acorn Fund Class Z
Natixis Fund Trust II Vaughn Nelson Value Opportunity Fund Class N
CRM Small Cap Value Fund Class Institutional
DFA U.S. Small Cap Portfolio Institutional Class
Vanguard FTSE All-World ex-US Index Fund Admiral Shares
Vanguard Total International Stock Index Fund Admiral Shares
Vanguard Target Retirement Income Fund Investor Shares
Vanguard Institutional Target Retirement Income Fund Institutional Shares
Vanguard Target Retirement 2010 Fund Investor Shares
Vanguard Institutional Target Retirement 2010 Fund Institutional Shares
Vanguard Target Retirement 2015 Fund Investor Shares
Vanguard Institutional Target Retirement 2015 Fund Institutional Shares
Vanguard Target Retirement 2020 Fund Investor Shares
Vanguard Institutional Target Retirement 2020 Fund Institutional Shares
Vanguard Target Retirement 2025 Fund Investor Shares
Vanguard Institutional Target Retirement 2025 Fund Institutional Shares
Vanguard Target Retirement 2030 Fund Investor Shares
Vanguard Institutional Target Retirement 2030 Fund Institutional Shares
Vanguard Target Retirement 2035 Fund Investor Shares
Vanguard Institutional Target Retirement 2035 Fund Institutional Shares
Vanguard Target Retirement 2040 Fund Investor Shares
Vanguard Institutional Target Retirement 2040 Fund Institutional Shares
Vanguard Target Retirement 2045 Fund Investor Shares
Vanguard Institutional Target Retirement 2045 Fund Institutional Shares
Vanguard Target Retirement 2050 Fund Investor Shares
Vanguard Institutional Target Retirement 2050 Fund Institutional Shares
Vanguard Target Retirement 2055 Fund Investor Shares
Vanguard Institutional Target Retirement 2055 Fund Institutional Shares
Vanguard Target Retirement 2060 Fund Investor Shares
Vanguard Institutional Target Retirement 2060 Fund Institutional Shares
Vanguard Prime Money Market Fund Admiral Shares
Vanguard Federal Money Market Fund Investor Shares
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Your investment options WHAT’S NOT CHANGING? The investment options listed below will remain in the Plan. Any balances you have invested as of May 31 will transfer to the same funds (referred to as an “in-kind” transfer). Any future contributions will continue to be invested in these funds unless you direct Fidelity otherwise by making changes to your account before May 20. CURRENT INVESTMENT OPTIONS
TICKER SYMBOL
Baird Core Plus Bond Fund Class Institutional
BCOIX
Vanguard Total Bond Market Index Fund Institutional Shares
VBTIX
Vanguard Institutional Index Fund Institutional Shares
VINIX
Dodge & Cox International Stock Fund
DODFX
For an explanation of your rights to direct investments, any Plan restrictions, and a description of the types of fees and expenses associated with your Plan account, refer to the enclosed Participant Disclosure Notice. While many accounts may need to be liquidated and reinvested in the new investment option, Memorial Hermann may determine that a reregistration, or in-kind transfer, is appropriate. Please be aware the transfer methodology may vary by individual investment option, and certain options may be out of the market for a day or more while others remain fully invested during the transition.
o Get on c
urse!
Fidelity® Portfolio Advisory Service at Work The Fidelity® Portfolio Advisory Service at Work is a managed account service to help you get, and stay, on course toward your retirement goals. Fidelity’s team of investment professionals invest, monitor and rebalance your account as needed to adjust to changes in the market or changes to your situation. This service does require a fee, which is paid from your account. Contact Fidelity at 1.866.811.6041 for more information on this managed account service. 9
Your default investment option New enrollees to the Plan after June 1 who do not make an investment election will be invested in a Vanguard Institutional Target Retirement Date Fund Institutional Shares. Your future contributions will be invested in the Fund with a target retirement date closest to the year you may retire and assumes a retirement age of 65. The Vanguard Institutional Target Retirement Date Funds Institutional Shares are designed for investors expecting to retire around the year indicated in each fund’s name. Except for the Vanguard Institutional Target Retirement Income Fund Institutional Shares, the funds’ asset allocation strategy becomes increasingly conservative as it approaches the target date and beyond. Ultimately, the funds are expected to merge with the Vanguard Institutional Target Retirement
Income Fund Institutional Shares. The investment risk of each Fund changes over time as the funds’ asset allocations change. The funds are subject to the volatility of the financial markets, including equity and fixed income investments in the U.S. and abroad, and may be subject to risks associated with investing in high-yield, smallcap, commodity-linked and foreign securities. Principal invested is not guaranteed at any time, including at or after the target dates. Use the guidelines in the table below, as provided by the Plan sponsor, to determine in which Vanguard Institutional Target Retirement Date Fund Institutional Shares your future contributions will be invested if you don’t make an election.
DATE OF BIRTH
FUND NAME
TARGET RETIREMENT DATE
Before 12/31/1942
Vanguard Institutional Target Retirement Income Fund Institutional Shares
Before 2007
1/1/1943 – 12/31/1947
Vanguard Institutional Target Retirement 2010 Fund Institutional Shares
2008 – 2012
1/1/1948 – 12/31/1952
Vanguard Institutional Target Retirement 2015 Fund Institutional Shares
2013 – 2017
1/1/1953 – 12/31/1957
Vanguard Institutional Target Retirement 2020 Fund Institutional Shares
2018 – 2022
1/1/1958 – 12/31/1962
Vanguard Institutional Target Retirement 2025 Fund Institutional Shares
2023 – 2027
1/1/1963 – 12/31/1967
Vanguard Institutional Target Retirement 2030 Fund Institutional Shares
2028 – 2032
1/1/1968 – 12/31/1972
Vanguard Institutional Target Retirement 2035 Fund Institutional Shares
2033 – 2037
1/1/1973 – 12/31/1977
Vanguard Institutional Target Retirement 2040 Fund Institutional Shares
2038 – 2042
1/1/1978 – 12/31/1982
Vanguard Institutional Target Retirement 2045 Fund Institutional Shares
2043 – 2047
1/1/1983 – 12/31/1987
Vanguard Institutional Target Retirement 2050 Fund Institutional Shares
2048 – 2052
1/1/1988 – 12/31/1992
Vanguard Institutional Target Retirement 2055 Fund Institutional Shares
2053 – 2057
After 1/1/1993
Vanguard Institutional Target Retirement 2060 Fund Institutional Shares
2058 and later
For an explanation of your rights to direct investments, any Plan restrictions, and a description of the types of fees and expenses associated with your Plan account, refer to the enclosed Participant Disclosure Notice.
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Tools and resources Investing in you begins with NetBenefits at www.netbenefits.com/mhhs. Once you’ve set up your account, you have access to tools, resources and guidance to get your investment strategy on track. You can also access your Fidelity account information from the Benefits Worklet in Workday. ONLINE TOOL
HELPS YOU TO:
Planning & Guidance Center
Stay on track and create a retirement plan
Contribution Calculator
See how changing your contributions can grow your money over time
Take Home Pay Calculator
See how your pre-tax contribution might affect your take-home pay
Full View
Easily monitor all of your Fidelity and non-Fidelity online financial accounts in one secure place
Savings and Spending Checkup
Compare your saving and spending
Asset Allocation Worksheet
Learn more about investing your savings among stocks, bonds and short-term investments
Fidelity Income Strategy Evaluator®
Build your portfolio
IMPORTANT: The projections or other information generated by Fidelity’s Income Strategy Evaluator and Planning & Guidance Center retirement analysis tools regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results and are not guarantees of future results. Results may vary with each use and over time. Guidance provided by Fidelity through Fidelity Income Strategy Evaluator and Planning & Guidance Center is educational in nature, is not individualized and is not intended to serve as the primary basis for your investment or tax-planning decisions.
For illustrative purposes only.
I need a toolbox!
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Your action checklist Although we’ll handle most of the work when it comes to the transition, there are still a few things you can do to prepare.
Are you ready?
Action:
By:
Make any desired changes to your Principal account(s) before the blackout period
May 20 (3 p.m. CT)
Log on to NetBenefits®, set up your account and update your beneficiary information
After the blackout period (week of June 19)
Download the NetBenefits® mobile app from the App Store™ or Google Play™
After the blackout period (week of June 19)
Watch your inbox for more exciting news about the move to Fidelity
After the blackout period (week of June 19)
I’m using this list!
Apple, the Apple logo, iPad, iPhone and iPod touch are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc. Android and Google Play are trademarks of Google Inc. This document provides only a summary of the main features of the MHHS Retirement Plans, and the Plan document will govern in the event of any discrepancies. Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917
Keep in mind that investing involves risk. The value of your investment will fluctuate over time, and you may gain or lose money.
© 2016 FMR LLC. All rights reserved. 755084.1.1
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