[March 1, 2004]

Two new UC-managed investment options will be available to participants in the UCRS Defined Contribution Plan (DC Plan) and Tax-Deferred 403(b) Plan beginning in April: the TIPS (Treasury Inflation-Protected Securities) Fund and the Balanced Growth Fund (replacing the Multi-Asset Fund). The Money Market Fund will be closing and assets will be merged into the Savings Fund.

In the first week of March, participants with Money Market and/or Multi-Asset Fund balances will receive a letter explaining what will happen to their balances.

The new funds
The new Treasury Inflation-Protected Securities Fund (TIPS Fund) is composed of United States Treasury Bonds whose principal will be adjusted for changes in the Consumer Price Index. The TIPS Fund will be a stand-alone investment option as well as a component of the new Balanced Growth Fund.

The Balanced Growth Fund is a blended fund composed of three UC funds with an allocation of 65 percent Equity Fund, 30 percent in the Bond Fund and 5 percent in the new TIPS Fund. The Money Market Fund, which is closing, and the Savings Fund will not be part of the Balanced Growth Fund.

If you want to invest in TIPS or Balanced Growth funds
If you want any of your existing DC Plan or 403(b) Plan balance to be transferred into the Balanced Growth Fund or the TIPS Fund, you may do so online now. Transfers made by March 25 will be processed in April.

If you want to direct future contributions to either fund, you can do so online beginning with your April earnings. In order to contribute your April earnings, you must request a change before your local payroll deadline in April.

Because of processing time, your 403(b) Plan or DC Plan balances may not reflect your changes for a month or more. For example, transfer requests are processed once each month, and the cutoff date for processing transfers is the 25th of the month. If you request a transfer between March 26 and April 25, it will usually be reflected in your account balance around May 25, with an effective date of May 1.

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