Washington State

Department of
Retirement Systems

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• • Introduction
  • TRS Plan 2
  • TRS Plan 3
  • • Overview
    • Defined Benefit
    • Defined Contribution
    • DC Investment Choices
    • Gain Sharing
  • Deciding on a Plan
• Seminars
• Comparison Chart
• How to Choose
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Defined Contribution Investment Choices

What investment choices do I have?
The Defined Contribution Component of TRS Plan 3 offers members the choice between two investment programs:

• The WSIB Investment Program offers a pre-mixed portfolio of investments that are automatically selected, monitored, and rebalanced by the Washington State Investment Board.
• The Self-Directed Investment Program allows you to design your own investment portfolio from a menu of funds, and/or to choose one of three balanced funds.

What factors influence my investment choices?
Both your risk tolerance and your retirement goals will play a significant role in your investment choices. As a TRS Plan 3 member, it is your responsibility to manage your investment choices to meet your retirement goals.

1) The WSIB Investment Program
If you choose to have your contributions directed to the WSIB Investment Program, they will be invested basically the same way the TRS Plan 2 money and the TRS Plan 3 Defined Benefit component money is invested. Contributions will be placed into the WSIB’s Total Allocation Portfolio (TAP). The Total Allocation Portfolio is a diversified portfolio of U.S. and international stocks, bonds, private equity and real estate investments and is a monthly valued fund.

2) The Self-Directed Investment Program
The Self-Directed Investment Program allows you to choose from a menu of professionally managed funds. You can choose from any or all of six investment funds and/or from among three pre-set portfolios, which are composed of various mixed funds.

The seven investment funds, which have risk/return profiles that range from low risk/low return to higher risk/higher return, allow you to create your own investment mix:

• Money Market Fund
• Washington State Bond Fund
• U.S. Large Stock Index Fund
• U.S. Stock Market Index Fund
• U.S. Small Stock Index Fund
• International Stock Index Fund
• Socially Responsible Balanced Fund

If you choose from the six investment funds as part of the Self-Directed Investment Program, you will be responsible for monitoring your account balances and periodically rebalancing if necessary in order to maintain your investment objectives.

The three pre-set portfolios, called Horizon Funds, are designed for investors with various risk profiles and time horizons, who want a diversified portfolio with the convenience of a single investment. The funds are automatically rebalanced so that they remain consistent with their stated investment objectives:

• The Short-Horizon Fund is designed for investors who desire relatively low risk with corresponding lower potential return.
• The Mid-Horizon Fund is designed for investors who can tolerate moderate risk with corresponding potential moderate long-term return.
• The Long-Horizon Fund is designed for investors who can tolerate a relatively high level of risk with corresponding potential higher long-term return.

If you select the Self-Directed Investment Program and do not make an investment choice, your contributions will be invested in the Money Market Fund.

How can I learn more about the investment options available in TRS Plan 3?
The Department of Retirement Systems provides the following information about TRS Plan 3 investment choices:

• Investment education packet (277K PDF)
• Investment education seminars
• Web site at www.drs.wa.gov/member/

These materials are available from your employer.

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