| Q: |
Who may transfer DROP account monies? |
| A: |
Only Members on Active Service who have a City of Dallas 401(k)
account.
|
| Q: |
How often will I be able to transfer my DROP funds to my City of
Dallas 401(k) account? |
| Q: |
Can I transfer my entire DROP account balance? |
| A: |
Yes. Either some, part, or all of the funds in your DROP account
may be transferred to your City of Dallas 401(k) Plan account. As
required by IRS Code, a portion of the transferred money is a return
of your contributions. When the funds are transferred to Fidelity
(on behalf of the City’s 401(k) Plan), the bulk of your funds
will generally go into your pre-tax 401(k) account with a smaller
amount (your after-tax contributions) going into your after-tax account.
|
| Q: |
Will I make more on my funds if they are invested with Fidelity
in the 401(k)? |
| A: |
With your DROP account, you know exactly the interest rate that
will be used to credit earnings to your account each year. Under
the City of Dallas 401(k) Plan, there is no guarantee on the amount
you will earn or lose. Although it may appear to be necessary to
take a higher risk to earn a greater return, this general investment
principal is the result of investment professionals long-term statistics.
It certainly does not mean that taking greater risks necessarily
is more likely to generate higher returns in a particular case. You
should carefully study about investing, and if possible, obtain sound
advice from competent investment professionals about how to invest
your 401(k) monies. The Pension System office and its staff cannot, in any manner, give investment advice.
|
| Q: |
When will you transfer funds? |
| A: |
Your written request must be received in the Pension System office
no later than three business days before the end of the month for
which you want the transfer made. Fidelity (the 401(k) plan administrator)
requires that you complete their “transfer form” which
is available at the Pension System office. You must meet with a Benefits
Counselor to ensure that the form is correctly completed prior to
the three business days mentioned above. If your request is timely,
we will transfer the funds on the first working day of the next month
or as soon as administratively feasible.
|
| Q: |
Can I transfer funds back into my DROP account from the City 401(k)
plan? |
| A: |
No. Once the funds are removed from the Police and Fire Pension
System, they cannot be redeposited.
|