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Mission Square gives Vallejo committee a plan health update and flags 2026 catch‑up rules
Summary
Mission Square presenters reviewed plan balances, engagement metrics and upcoming IRS catch‑up and Roth‑catch‑up changes for 2026, and recommended fund menu adjustments informed by performance, risk and fee analysis.
Mission Square staff gave the Vallejo Deferred Compensation Committee a detailed review of plan health, participation and upcoming legislative provisions that could affect plan administration in 2026.
Luther of Mission Square briefed the committee on organizational enhancements, local team roles and a calendar of education and outreach activities. He presented Q4 plan metrics — notably a drop in RPS consultations to 17 in 2025 from 64 the prior year, 37 participant enrollments in Q4 2025 (he said he would verify a possible transcription discrepancy), and a year‑over‑year plan balance increase of about 16.3 percent.
Luther also explained two provisions that may require operational changes for the plan in 2026: a ‘‘super catch‑up’’ for participants aged 60–63 that permits an additional $11,250 catch‑up contribution above the usual catch‑up limit, and a Roth catch‑up mandate that applies to plans where the employer pays into FICA/social security. "If you choose to opt out, it could be as simple as an email," Luther said, describing an administrative opt‑out option for plan sponsors who need more time to update payroll systems.
Vincent followed with an economic and market overview and a fund‑menu review. He highlighted market concentration in a handful of large technology companies and argued that concentration risk makes it harder for active large‑growth managers to beat benchmarks. Using peer‑rankings and net‑of‑fee returns, Vincent presented three replacement candidates for the Vanguard US Growth fund (JPMorgan, Fidelity and Putnam) and recommended the committee consider replacement where incumbents have lagged.
The presenters walked the committee through fee disclosures, the administrative allowance and how the committee can use those funds to support education programs. Both presenters offered to provide analytics and communications support to help the city run engagement campaigns and to track desired participant actions (for example, beneficiary updates or webinar attendance).
Next steps include vendor coordination to execute approved fund replacements and a plan to return to the committee with the implementation details for the quarterly engagement incentive and scheduled communications to participants.
