Policy Number: 4-82
Policy Name: Voluntary Retirement Programs
Revisions: July 2005
I. Voluntary 403(b) Retirement Plan
Participation in the Voluntary 403(b) Retirement Plan through Fidelity Investments and Teachers Insurance and Annuity Association (TIAA) - College Retirement Equities Fund (CREF) is available to all regular full and part-time employees. This plan is designed for individuals who wish to make additional tax-deferred contributions to their retirement savings. Participation in the Voluntary Plan does not require a minimum contribution as does the standard University 403(b) Retirement Plan for faculty and professional staff. The University makes no contribution to the Voluntary Retirement Program.
Individuals may not tax defer more than the IRS limits. Please see the 403(b) Retirement Plan Annual Contribution Limits for further information.
II. Voluntary 457(b) Deferred Compensation Plan
Participation in the Voluntary 457(b) Deferred Compensation Plan is available to all regular full and part-time employees. This plan is designed for individuals who are already making the maximum allowable contribution (per IRS limits) to the Voluntary 403(b) Retirement Plan. Although there are no University contributions to the Plan, the tax benefits of participating in a 457(b) Plan make it very attractive for supplemental retirement savings. Please refer to the 457(b) Deferred Compensation Plan Annual Contribution Limits for further information.
The Voluntary 457(b) Plan is very similar to the Voluntary 403(b) Plan, enabling employees to set aside a portion of their salary on a tax-deferred basis to augment their pension/retirement plans and Social Security benefits. Fidelity Investments and Teachers Insurance and Annuity Association (TIAA) - College Retirement Equities Fund (CREF) administer this program, which offers the same investment options as the Voluntary 403(b) Retirement Program.
Employees interested in enrolling or making a change to their current contributions must complete a new salary reduction agreement and an application, if opening a new contract. Salary reduction agreements for the 403(b) ( faculty/professional or salaried/hourly staff) and 457(b) plans are separate and distinct. The earliest a change or new withholding can be effective is the first of the month following the date of a newly signed agreement. Eligible employees may participate concurrently in both Fidelity Investments and TIAA-CREF.
There are various income options at retirement, including lifetime annuity income, fixed period annuities, deferred income, systematic withdrawals, lump sum withdrawals, and interest-only payments. Please see the retirement plan vendors' interactive web sites: Fidelity Investments and TIAA-CREF. Through a secure logon, employees can make allocation changes, change beneficiaries, and have access to retirement planning tools.
Submitted by: Office of Human Resources-Benefits