City Council Approves Transition to Voya for $12K in Annual Investment Savings

The McKinney City Council meeting held on August 25, 2025, focused on a significant review of the city's 457(b) retirement plan, particularly regarding the transition to a new provider, Voya Financial. The discussion highlighted the substantial cost savings and improved investment options that this change would bring to participants.

The meeting began with a presentation detailing the current fees associated with the retirement plan, which amounted to $225,000 charged by the previous two firms. The committee proposed a shift to a single provider, Voya, which would reduce these fees dramatically to just $12,000 annually. This change is expected to enhance the returns on investments for participants significantly.

Council members expressed satisfaction with the committee's involvement in the review process, emphasizing the importance of asking critical questions that led to this recommendation. Voya was praised for its innovative participant experience and user-friendly services, along with a dedicated support team.

The discussion also covered the investment options available through Voya, noting that while there would be proprietary funds offered, participants would have access to a broader range of better-performing funds. The committee assured that these funds would be closely monitored to ensure optimal performance.

Additionally, the meeting addressed the needs of more sophisticated investors who prefer to manage their own investments. Voya will offer a self-directed fund option, allowing participants to trade and handle their investments independently, with Charles Schwab facilitating the transition of existing funds.

The council concluded the meeting by outlining the next steps, stating that the transition to Voya would begin in October, with all participant funds automatically moved to the new provider. This strategic decision is anticipated to provide significant financial benefits to the city's employees and enhance their retirement savings.