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Retirement
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Retirement Savings Plan |
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The Retirement Savings Plan is a voluntary 401(k) plan that allows you to set
aside for your retirement up to 75% of your eligible pay, subject to IRS
limits.
You have two ways to save through the plan:
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Traditional 401(k) savings—contributions deducted from
your eligible pay on a pre-tax basis, reducing your current taxable income and
the income taxes you pay. When you retire, you pay taxes when you receive your
retirement benefit.
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Roth 401(k) savings—contributions deducted from your eligible
pay on an after-tax basis, which means they are taxed as current income. When
you retire, you pay no taxes on your Roth 401(k) retirement benefits as the
taxes have already been paid.
You can save with Traditional 401(k) savings (pre-tax dollars) or Roth 401(k)
savings (after-tax dollars)… or save both ways. The choice is yours!
For every dollar you save (up to 6% of your pay), Advocate will contribute an
additional 50 cents, up to a maximum of 3% of your eligible pay.
Here's an example of how the plan works for an associate who earns $25,000 per
year, saves 6% of pre-tax pay and receives the maximum matching contribution:
| Associate's total contribution |
$1,500 (6% of $25,000) |
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| Advocate matching contribution |
$ 750 (3% of $25,000) |
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| Total annual savings |
$2,250 |
Your contributions to the plan are made through convenient automatic payroll
deduction. Contributions must be made in whole increments of 1% of eligible
pay.
Automatic enrollment
Advocate automatically enrolls new associates in the Retirement Savings Plan.
This means that Advocate establishes a Traditional 401(k) pre-tax deduction of
3% of eligible pay on your behalf. Deductions will begin starting with your
first paycheck after 30 calendar days of employment. Advocate's matching
contributions of $0.50 on the dollar begin immediately. These matching
contributions are subject to vesting. Your contribution of 3% of eligible pay,
along with Advocate's matching contribution of 1-1/2%, automatically saves
4-1/2% toward your retirement!
You may elect to increase or decrease your pre-tax contribution percentage or
elect to make Roth 401(k) after-tax contributions using
Advocate InfoExpress. You may contribute up to 75% of your eligible
pay. You may choose to opt out of (zero out) your automatic deferral in the
plan, and join at a later time.
Both your contributions and Advocate's matching contributions are invested in
the plan's "stable value" investment option, unless you reallocate these
contributions among one or more of Plan's other investment fund options. Be
sure to read Know Your Options—investment-related information that is updated
on a quarterly basis. These materials provide investment information on the
available funds in the plan. You may make investment mix changes as often as
you like through Advocate InfoExpress.
To see the latest available Know Your Options quarterly update, click on the
appropriate link below.
Contribution limits
You can save a maximum of 75% of your eligible pay through the plan—up to a
specified dollar maximum—each year. This dollar maximum is $15,500. If you are
age 50 or older—or will turn age 50 anytime during the year—you can contribute
up to an additional $5,000 to the plan each year (or up to $20,500). These
limits apply to Traditional 401(k) and Roth 401(k) contributions combined.
If you are eligible to make the $5,000 age 50 “catch-up” contribution, your
contributions will automatically continue until your total contributions in a
year reach the applicable limit ($20,500). No special election is required.
Your choice of investment options
As a participant in the Advocate Retirement Savings Plan, you may choose to
invest your savings and matching contributions in one or more of
the plan's variable investment funds, as you choose, or you may choose to
invest in one of the plan's target retirement funds, as outlined below.
Variable investment funds
If you want to choose your own investment mix, you may invest your savings and
matching contributions in one or more of the following "variable" investment
funds":
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Investment fund |
Ticker symbol |
| Vanguard Retirement Savings Trust II Fund |
RSTII |
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| PIMCO Real Return Fund–Institutional Shares |
PRRIX |
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| Vanguard Total Bond Market Index Fund–Institutional Shares |
VBTIX |
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| PIMCO Total Return Fund–Institutional Class |
PTTRX |
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| Vanguard Balanced Index Fund–Institutional Shares |
VBAIX |
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| Dodge & Cox Stock Fund |
DODGX |
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| Vanguard Institutional Index Fund–Plus Shares |
VIIIX |
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| Neuberger Berman Socially Responsive Fund |
NBSRX |
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| Vanguard Total Stock Market Index Fund–Institutional Shares |
VITSX |
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| Lazard Mid-Cap Fund–Institutional Shares |
LZMIX |
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| Dodge & Cox International Stock Fund |
DODFX |
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| T. Rowe Price Small-Cap Stock Fund |
OTCFX |
It's up to you to choose the fund or combination of funds that meet your saving
and investment objectives. You must allocate your contributions and Advocate's
matching contributions among the funds in whole percentages, and the total must
equal 100%.
For example:
Vanguard Short-Term Investment-Grade–Admiral Shares
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33% |
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Vanguard Balanced Index Fund–Institutional Shares
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33% |
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T. Rowe Price Small Cap Stock Fund
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34% |
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| Total |
100% |
This example is for illustration purposes only, and isn't intended to
constitute investment advice. Remember, you're responsible for making your own
personal investment choices. Advocate isn't responsible for your investment
decisions. For more information on our investment choices, go to
Advocate InfoExpress.
Target retirement funds
Target retirement funds provide a "one choice" approach to investing for
retirement. These funds are pre-mixed and include underlying funds from various
investment styles. All you need to do is choose the fund with the date nearest
the year in which you expect to retire. There are 11 target retirement funds
from which to choose:
| Target Retirement 2050 Fund |
VFIFX |
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| Target Retirement 2045 Fund |
VTIVX |
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| Target Retirement 2040 Fund |
VFORX |
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| Target Retirement 2035 Fund |
VTTHX |
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| Target Retirement 2030 Fund |
VTHRX |
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| Target Retirement 2025 Fund |
VTTVX |
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| Target Retirement 2020 Fund |
VTWNX |
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| Target Retirement 2015 Fund |
VTXVX |
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| Target Retirement 2010 Fund |
VTENX |
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| Target Retirement 2005 Fund |
VTOVX |
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| Target Retirement Income Fund |
VTINX |
The investment mix for each fund is periodically adjusted to reflect typical
investment risk and return for people with similar retirement goals. To learn
more about target retirement funds, read the brochure titled
Introducing Target Retirement Funds: Investing Made Simple.
Vesting
You are always vested in the value of your own contributions to the plan.
You become vested in Advocate's matching contributions at the rate of 20% for
each year of service you complete. For purposes of the plan, a "year of
service" means the first calendar year in which you complete 1,000 or more
hours of service with Advocate and each following calendar year in which you
complete 1,000 or more hours of service with Advocate or are employed
continuously with Advocate for the entire calendar year. This means that you
become fully vested in matching contributions once you've remained employed for
5 full calendar years, or worked 1,000 hours in each of those 5 plan years.
However, you'll become fully vested in your entire account immediately if you
leave or retire from Advocate at age 55, become disabled while employed or die
while employed.
Changing your elections
As you manage the investment of your contributions and matching contributions
in the Advocate Retirement Savings Plan, you may change your investment choices
from time to time. In general, the Plan is set up to accommodate these changes
as they occur. Changes to your investment choices made before 3:00 pm.
Central time will normally take effect the next business day. You can request
investment changes through Advocate InfoExpress online at
www.advocateinfoexpress.com.
Certain restrictions apply to the frequency and/or timing of investment changes
involving certain investment funds, including the Plan's new target retirement
funds. These restrictions are required under guidelines issued by the
Securities Exchange Commission (SEC) and effective October 16, 2006. For more
information, review detail in the
Market Timing Activity brochure.
Loans and withdrawals
The Retirement Savings Plan is intended to help you save for your retirement.
For this reason, once your money goes into the plan, it generally cannot be
withdrawn before you reach age 59-1/2 without incurring early withdrawal
penalties and income tax withholding, according to IRS rules. However, you may
borrow certain funds from your account, or receive a withdrawal in the event of
a financial hardship.
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Loans
You may borrow from your account, generally up to 50% of your vested account
balance, but not more than $50,000 (with a $1,000 minimum per loan and a
minimum vested balance of $2,000).
You repay the loan, plus interest, to your own account through payroll
deductions. Generally, the length of the loan is up to 5 years, although 10
year loans are permitted for buying or building your primary residence.
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Withdrawals
In the event of a financial hardship, you may be eligible to withdraw some or
all of the pre-tax contributions, consistent with IRS guidelines.
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For more details about loans and withdrawals, contact
Advocate InfoExpress.
When you may withdraw your full account balance
If you leave Advocate before age 55, you may elect to receive the full value of
your savings and any investment earnings, plus the vested portion of your
matching contributions and any investment earnings. Remember, if you have
reached age 55 while employed at Advocate, you're fully vested upon
termination.
Important information
How you invest your Retirement Savings Plan account is an important decision
which you should make carefully. It is your responsibility to thoroughly review
all the information provided to you by the fund sponsor prior to making your
investment choices. Advocate cannot advise you how to invest or take
responsibility for the performance of any investment fund.
All plan contributions are subject to limits imposed by the Internal Revenue
Code and plan rules. These include, but aren't limited to, IRC 402(g) limit,
IRC 415(c) limit, top heavy limits, and required annual plan testing limits.
Plan refunds may be necessary if contributions fail IRS testing or plan limits.
Payments from the plan are subject to Federal tax rules in effect at the time
of any payment from the plan, including but not limited to final distributions,
loans, and hardship and 59-1/2 withdrawals. More information is available in
the Special Tax Notice Regarding Plan Payments.
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