1. CITY OF EUGENE DEFERRED COMPENSATION PROGRAM Make Saving Easy with Target Date Retirement Funds Updated 6/2/15

2. Target Date Retirement Funds You lead a busy life It can be hard to find the time to focus on your retirement plan. That’s why the City’s Deferred Compensation Plan includes Vanguard Target Retirement Funds. These funds are a simple way to invest throughout your career and into retirement. A single Target Retirement Fund can serve as a complete, diversified retirement portfolio.

3. Target Date Retirement Funds How Target Retirement Funds work Each Target Retirement Fund invests in several Vanguard funds, primarily low-cost index funds, to create a broadly diversified mix of stocks and bonds. The year in a Target Retirement Fund’s name is its target date, the approximate year in which an investor in the fund expects to retire and leave the workforce. Keep in mind that a Target Retirement Fund is subject to the risks of its underlying funds. Its returns are not guaranteed, and investing in one does not ensure that you will have enough income in retirement.

4. Target Date Retirement Funds *Approximate allocation targets for each fund as of May 2013. As time passes, allocations for the date-specific funds will gradually shift their emphasis toward a more conservative allocation (from stocks to bonds) over time based on an assumed retirement age of 65.

5. A Quick Target Date Q & A Q: What are Target Retirement Funds? A: Target Retirement Funds are broadly diversified funds that gradually and automatically shift to more conservative investments as you get closer to retirement. Because each Target Retirement Fund is a complete investment package, a single fund can serve as your entire plan portfolio. Keep in mind that although Target Retirement Funds can simplify investment selection, all mutual fund investing is subject to risk. In addition, Target Retirement Funds are subject to the risks associated with their underlying funds. For instance, investments in bond funds are subject to interest rate, credit, and inflation risk. Diversification does not ensure a profit or protect against a loss in a declining market. Q: How are Target Retirement Funds invested? A: Each Target Retirement Fund invests in up to seven broadly diversified Vanguard funds—most of which are index-based. Vanguard’s long history includes the introduction of the first index mutual fund for individual investors in 1976. Q: Is a Target Retirement Fund appropriate for a new investor? A: Yes, because you have potentially only one decision to make—what year you expect to retire. Vanguard does the rest, assembling and managing a mix of investments appropriate for your stage of retirement planning.

6. A Quick Target Date Q & A Q: Is a Target Retirement Fund appropriate for an experienced investor who has limited time to manage his or her money? A: Yes. Target Retirement Funds allow you to implement sophisticated investing strategies while leaving the time-consuming details of portfolio management to Vanguard. Target Retirement Funds allow you to take advantage of Vanguard’s years of experience as one of the world’s largest investment management companies. Q: Can I lose money in a Target Retirement Fund? A: Yes. As with most investments, Vanguard Target Retirement Funds can go up and down in value based on market fluctuations. However, Vanguard manages the funds with your long-term goal of retirement in mind, while keeping a strict focus on appropriate diversification and low costs. Your fund’s investments automatically become more conservative as you approach and enter retirement.

7. DEFERRED COMPENSATION PURPOSE Voluntary Supplemental Retirement Program ELIGIBILITY All regular, Limited Duration and RAE employees

8. HOW DEFERRED COMP 457(b) WORKS  Pre-Tax Option  Shelters your money from immediate taxes  Taxes are paid on contributions and earnings at distribution  Convenient Payroll Deduction  Post-Tax Roth Option  Contributions are made after taxes  Earnings are income tax-free upon qualified distribution  Convenient Payroll Deduction DEFERRED COMPENSATION

9. Deferred Comp Carrier for City of Eugene  Voya Financial  You can choose your level of involvement in managing your investments: Fixed and variable mutual fund investment options (you choose specific funds with Voya) Target Date Retirement Funds (investments are automatically made for you based on your target retirement date)

10. DEFERRED COMPENSATION Changes  You can stop or change contributions at any time  Changes are effective the 1 st of following month Withdrawals  Normally only allowed if you have a severe, unanticipated financial emergency (per IRS)  May be allowed at termination of employment, if eligible  Pre-tax – no penalty for withdrawal under age 59 ½  Roth – must be at least 59 ½ with at least five years since initial contribution to withdraw without penalty

11. DEFERRED COMPENSATION Maximum Annual Contribution  The maximum amount that can be deferred is 100% of your salary or $18,000 in 2015 (whichever is less)  Additional catch-up allowed if over 50  Pre-tax Option and Roth Option have combined maximum annual contribution

12. DEFERRED COMP BENEFIT AFSCME- and Non-Represented Only City Contribution if You are Deferring 1% of Salary  Non-Represented Employees: The City will contribute a Deferred Comp Benefit of 3% of your salary to your Pre-tax Account.  AFSCME Represented Employees Effective 7/1/15: The City will contribute a Deferred Comp Benefit of 2% of your salary to your Pre-tax Account.  The employee contribution can go into either a Roth or Pre-tax account. The City contribution must go into your Pre-tax account.  The City contribution accrues toward your annual maximum deferral amount.

13. DEFERRED COMPENSATION Enrollment  Sign up directly with Voya at any time  E-Z Enroll Mapped to Vanguard Target Date Retirement Fund by Age Additional information on COE Deferred Comp Website  Enrollment effective the 1 st of the following month, as required by IRS regulations Questions & Enrollment Appointments  Voya local Eugene office: 541.343.6759  160 E. Broadway Suite 200, Eugene, OR 97401 (entrance is behind the Quackenbush building)

14. BENEFIT INFORMATION or call the Employee Benefits Program staff:  Tina Dixon 541.682.8868  Janice Gross 541.682.5924  Christina Bucich 541.682.5062 Benefit forms, links and information is available 24 hours a day on the City of Eugene internet website at: www.eugene-or.gov/employeebenefits If you prefer to receive benefit information in Spanish, contact Jamie Iboa in Risk Services at 541.682.5791 Risk Services Division 940 Willamette St Suite 200

15. Plan now for your future!