Kentucky Supplemental Retirement Plan

• Category: Corporations - Public - Retirement
• State: Multi-State
• Control #: US-CC-21-104
• Format: Word; Rich Text

Description

21-104 21-104 . . . Supplemental Executive Retirement Plan which permits eligible management and highly-compensated employees to receive benefits that will compensate them for limitations imposed by Sections 401(a)(17), 401(k), 401(m) and 402(g) of Internal Revenue Code on salary deferrals and matching contributions under 401(k) plan The Kentucky Supplemental Retirement Plan (HSRP) is a retirement savings program offered to employees of the Commonwealth of Kentucky. It is designed to supplement the benefits provided by the Kentucky Retirement Systems (MRS) and help individuals save more for their retirement years. The HSRP offers various investment options, enabling participants to choose the one that aligns with their risk tolerance and long-term financial goals. These investment options include diverse portfolios such as stocks, bonds, and mutual funds. By contributing through payroll deductions, participants can conveniently allocate a portion of their income towards building a secure financial future. One of the advantages of the HSRP is the potential for tax advantages. Contributions made to the plan are typically tax-deferred, meaning they can be deducted from the participant's taxable income in the year they are made. This can result in a reduction of their overall tax liability for that year. Additionally, the investment earnings within the HSRP account grow on a tax-deferred basis until withdrawals are made during retirement, potentially providing a greater accumulation of funds over time. There are two types of Kentucky Supplemental Retirement Plans available for employees: the Defined Contribution (DC) plan and the Optional Retirement (ORP) plan. The DC plan allows employees to contribute a percentage of their salary to the HSRP, and the employer may also make matching or non-matching contributions based on the employee's participation. On the other hand, the ORP plan offers employees the opportunity to direct their contributions to various investment accounts outside the MRS system, providing them with even more flexibility and control over their retirement savings. The Kentucky Supplemental Retirement Plan is a valuable tool for employees who aim to enhance their retirement savings beyond what the traditional pension system offers. It allows participants to make informed investment decisions while enjoying potential tax benefits. The various plan options cater to the diverse needs and preferences of employees, enabling them to build a nest egg that aligns with their individual financial objectives and provides security during their retirement years.

The Kentucky Supplemental Retirement Plan (HSRP) is a retirement savings program offered to employees of the Commonwealth of Kentucky. It is designed to supplement the benefits provided by the Kentucky Retirement Systems (MRS) and help individuals save more for their retirement years. The HSRP offers various investment options, enabling participants to choose the one that aligns with their risk tolerance and long-term financial goals. These investment options include diverse portfolios such as stocks, bonds, and mutual funds. By contributing through payroll deductions, participants can conveniently allocate a portion of their income towards building a secure financial future. One of the advantages of the HSRP is the potential for tax advantages. Contributions made to the plan are typically tax-deferred, meaning they can be deducted from the participant's taxable income in the year they are made. This can result in a reduction of their overall tax liability for that year. Additionally, the investment earnings within the HSRP account grow on a tax-deferred basis until withdrawals are made during retirement, potentially providing a greater accumulation of funds over time. There are two types of Kentucky Supplemental Retirement Plans available for employees: the Defined Contribution (DC) plan and the Optional Retirement (ORP) plan. The DC plan allows employees to contribute a percentage of their salary to the HSRP, and the employer may also make matching or non-matching contributions based on the employee's participation. On the other hand, the ORP plan offers employees the opportunity to direct their contributions to various investment accounts outside the MRS system, providing them with even more flexibility and control over their retirement savings. The Kentucky Supplemental Retirement Plan is a valuable tool for employees who aim to enhance their retirement savings beyond what the traditional pension system offers. It allows participants to make informed investment decisions while enjoying potential tax benefits. The various plan options cater to the diverse needs and preferences of employees, enabling them to build a nest egg that aligns with their individual financial objectives and provides security during their retirement years.