With thousands of investment selections available through the Self-Directed Brokerage Account, the Fiat Chrysler Automobiles (FCA) Salaried Employees' Savings Plan (SESP) and UAW Savings Plan 401(k)'s are among the best in the country. With this large number of investments, there is ample opportunity to build a well diversified portfolio for your FCA 401k savings.
Please visit our “Fund Commentary” section below for further information on specific funds and/or fund types within the SESP and UAW Saving Plan accounts.
Below you will find articles of interest as well as news and updates to FCA employee and retiree benefits. Check this page for future updates to the SESP and UAW Savings Plan, as well as news that affects FCA employees and retirees.
For Your Interest
FCA Health Savings Account
Health Care Costs
FCA Offers Pension Lump Sum Payments – September 2016
Fiat Chrysler Automobiles (FCA) has announced it will offer approximately 7,300 salaried employees that have a vested pension with Chrysler, are separated, and have not started receiving their pension, the option to receive a voluntary lump sum pension benefit payment. This group will be offered one of three options.
- Receive the pension in a Lump Sum
- Begin receiving monthly pension payment as early as December 2016, or
- Wait to receive the monthly pension payment as specified under the terms of the plan
FCA retirees and former employees impacted by this offer will receive an Election Kit, Decision Guide, and Tip Sheet by mail in the next few weeks. However, there are several situations that would result in a person being excluded from this offer.
By taking advantage of the lump sum pension payment option, FCA retirees and former employees may reduce many potential pension risks including longevity risk due to inflation, tax risk, and mortality risk. Most importantly it will completely eliminate "PBGC risk" - the risk that monthly pension payments are someday reduced by the Pension Benefit Guaranty Corporation. However, whether to take a lump sum payment or not is based on one’s personal situation and these factors deserve individual attention and should be reviewed with a qualified professional.
If you would like assistance in navigating this very important retirement decision, contact one of our Certified Financial PlannersTM toll-free at 1-866-444-6246.
FCA Plan Update – June 2016
FCA announced late in 2015 that Employee Managed Retirement Plan (EMRP) balances will be transferring to the FCA US LLC Salaried Employees' Savings Plan (SESP). This transfer will take place after 5:00 PM ET on June 15, 2016. The current holdings in the EMRP will transfer to the same investment selection in the SESP. However, there are trading restrictions you need to be mindful of if you are intending to make changes to your EMRP allocation around the time of the transfer.
Although the funds will now be in the SESP, you will continue to have the ability to view your EMRP balance as a separate portion of your 401(k) account.
If you have questions about this change or how it may impact your retirement plan or current investment allocation, contact Mainstay Capital Management toll-free at 1-866-444-6246.
FCA Plan Update – November 2015
Effective December 31, 2015 FCA will discontinue contributions to the Employee Managed Retirement Plan (EMRP). In lieu of these contributions, beginning January 1, 2016 FCA will make an automatic contribution to the 401(k) and set up a company match.The automatic contribution will be 3% of the annual base salary. The match will be $.50 on each dollar contributed, up to 10% of your base pay, for a maximum 5% company match.
To maximize the company match, FCA employees will need to contribute 10% of their base salary into the 401(k). If you have questions about these changes or how they will impact your retirement plan, contact Mainstay Capital Management toll-free at 1 866 444 6246.
UAW Savings Plan – November 2015
Effective January 1, 2016 the FCA US LLC Hourly Employees’ Deferred Pay Plan (the HDPP) will be renamed to the FCA US LLC UAW Savings Plan (the “UAW Savings Plan”) in recognition that it now includes all UAW members. Unlike the HDPP, the UAW Savings Plan has an added feature that allows contributions on an after-tax basis. The UAW Savings Plan also has additional enhancements related to hardship withdrawals, bonus deferrals into the Roth, loan provisions, and company defined contributions.
If you have questions about these changes or how they will impact your retirement plan, contact Mainstay Capital Management toll-free at 1‑866‑444‑6246.
Chrysler PLM Award Payout – January 2014
The election window for Chrysler salaried employees for the disbursement of their 2013 Performance and Leadership Management (PLM) Award into the Salaried Employees’ Savings Plan (SESP) is open for one week. All deferral elections will need to be made between January 30th and February 6th at 3:00 PM (EST). If eligible, participants may contribute up to 100% (less mandatory withholdings) in 1% increments.
Participants should be sure to review their current deferral election to confirm it is in line with their desired deferral for the PLM. Participants may need to make adjustments to the current election under the “Base Only” or “Total Contribution” options prior to the deadline.
Keep in mind, any deferred PLM Award will be applied toward the annual 401(k) contribution limit. The IRS limit for pre-tax contributions in 2014 is $17,500, with an additional $5,500 for participants age 50 or older. If the PLM deferral takes the participant to the contribution limit, any remaining amount will be paid in cash.
If you would like to discuss your PLM Award payment and the deferral options, do not hesitate to contact Mainstay toll-free at 1-866-444-6246.
Chrysler Pension Freeze – June 2013
Chrysler announced it will freeze pension benefit accruals as of December 31, 2013 in the Chrysler LLC Pension Plan (CPP), Chrysler Group LLC Salaried Employees’ Retirement Plan (SERP), and the Chrysler Group LLC Executive Salaried Employees’ Retirement Plan (ESERP). Effective with the freeze, the company will instead make contributions to an Employee Management Retirement Plan (EMRP) account that is managed by the employee. Chrysler has also revised factors in their defined benefit pension formula to allow "retirement eligible" employees to receive 100% of accrued benefits earlier at age 58, revised from age 62, for those retiring on or after January 1, 2014.
If you have questions about the pension freeze, how you should manage the contributions in the EMRP, or how these changes will impact your retirement plan, contact Mainstay Capital Management toll-free at 1-866-444-6246.
Chrysler 401(k) Plan Overhaul – January 2013
The Chrysler Salaried Employees’ Savings Plan, Hourly Employees’ Deferred Pay Plan, and the Employee Managed Retirement Plan will undergo a significant overhaul beginning January 30, 2013 and closing on March 1, 2013. All current choices in the Core Investment Menu will be removed from the Savings Plans at the end of the election period. If you do not reallocate your funds during the election window, automatic investments will take place on your behalf.
If you have questions about the plan overhaul and how your account should be invested in light of this announcement, contact Mainstay Capital Management toll-free at 1-866-444-6246.
SESP & HEDPP Fund Change Announcement – September 2012
Chrysler has announced a fund change affecting the Salaried Employees’ Savings Plan (SESP) and the Hourly Employees’ Deferred Pay Plan (HEDPP). As of the close of business (4:00 PM EST) Friday, October 5, 2012, the Friess Small Cap Growth Portfolio will be removed from the plans.
All remaining balances and future contributions will be transferred to the Eagle Small Cap Core Portfolio. The Eagle Small Cap Portfolio is currently an option in the plans.
Chrysler Plan Change – August 2011
The Chrysler Stable Value Fund A investment option was removed from the SESP and HEDPP savings plans on August 26, 2011.
The new investment option, Institutional Money Market Portfolio, provides a similar investment objective as the Chrysler Stable Value Fund, however differs in risk and return characteristics.
If you have questions about this change to the plan or any other plan provisions, contact Mainstay Capital Management toll-free at 1-866-444-6246.
SEIDP & ESSP Will No Longer Accept Deferrals – December 2008
Chrysler announced changes that will affect the participants of the Salaried Employees’ Income Deferral Plan (SEIDP) and the Executive Employees’ Supplemental Savings Plan (ESSP).
Effective January 2009, the SEIDP and the ESSP plans will no longer accept deferrals. In addition, all distribution elections previously in effect are cancelled and your total account will be distributed to you as a lump sum in January 2009. However, if you do not want to receive the lump sum distribution in January 2009, there are two alternatives.
- First would be to elect to receive the lump sum in any year 2010 through 2013;
- Second alternative is to receive up to five annual installment payments in years 2009 to 2013.
Elections regarding the distribution of your lump sum must be made by December 31, 2008. If you would like assistance in choosing an option as it relates to your personal financial plan, do not hesitate to call us toll-free at 1-866-444-6246 to speak with a Financial Advisor.
Chrysler Savings Plan Changes – December 2008
Chrysler announced several investment option changes for the Salaried Employees’ Savings Plan (SESP), the Hourly Employees’ Deferred Pay Plan (HEDPP), and the Retirement Health Care Account (RHCA).
Effective December 12, 2008, DWS Dreman High Return Equity Fund, Fidelity Dividend Growth Fund, and Goldman Sachs Structured Small Cap Collective Trust will be eliminated from the Savings Plans. Assets in these funds and future contribution to these funds will be transferred to the new funds at the close of business on December 12, 2008, accordingly:
Dreman High Return Equity Fund To NewWest Large Cap Intrinsic Value Fund
Fidelity Dividend Growth To KeyBank EB Diversified Stock Fund
Goldman Sachs Structured Small Cap Collective Trust To Eagle Small Cap Core Portfolio
As of December 17, 2008 the three new investment options will be available in the Savings Plans and participants will be able to access their transferred investments and make changes to how their account balance is allocated or how their future contributions are to be directed.
News and Articles
- The Problem With Target-Date Funds
- ABC News Video: "Automotive workers seek advice on buyouts"
- Dow Jones Newswires
Adviser Fights Fear About GM With Fact
- Chicago Tribune
Consider financial future before accepting buyout
- Wall Street Journal
How to Value the Buyout Offer
Chrysler Target Date Funds
The Chrysler Target Date fund family is designed for those participants who wish to base their asset allocation decision on a specific target date, typically aligning the account with the fund that most closely matches their projected retirement date.
Twelve of these funds are included in the plan, with 5-year incremental targets from 2005 to 2055, along with a fund targeted as an Income Fund. The way the target retirement funds are designed, the further away the target date, the more aggressive the asset allocation, conversely, the closer the date, the greater the emphasis on preservation of capital in the asset allocation.
These funds hold some appeal in that they are simple to explain and administer. While this approach is unique, we believe the asset allocation decisions provided by these funds are crude at best. Target date funds attempt to make decisions about asset allocation based solely on a target date. An investor’s tolerance for risk and financial goals are other key factors that should largely play a role in determining the investment strategy and asset allocation. Additionally, they leave no room for the fund manager to tactically adjust the strategy based on specific opportunities within the financial markets or in response to prevailing market conditions.
The returns realized in these commingled vehicles are diluted by a rigid adherence to mechanical allocation parameters. These parameters may prove to be shortsighted and inappropriate for everyone participating in the pool. The real world changes every day, yet proponents of target date funds expect someone to stick to a single game plan for as much as 40 years, whether interest rates are rising or falling, or whether the economy is in expansion or recession. While target date funds offer a simple one-stop-solution, we continue to advise participants to avoid target date funds and retain the flexibility to proactively adjust their portfolios as needed.
Please reference The Problem With Target-Date Funds
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