Voluntary Retirement Plans

 

In addition to the mandatory retirement plans to which you contribute, you may also choose to participate in the voluntary retirement plans offered by Auburn University. There are 2 plan options from which to choose: the 403(b) Tax Deferred Annuity Plan or the 457(b) Deferred Compensation Plan. Visit the Side by Side Comparison of 403(b) Tax Deferred Annuity Plan and 457(b) Deferred Compensation Plan to learn more about the two plan options. Read below for additional plan details.

 

I.      Tax Deferred Annuities Plan 403(b)

University personnel have a means of deferring federal and state income tax that is unique to colleges, universities and other nonprofit organizations. Under Section 403(b) of the Internal Revenue Code, tax deferred annuity plans offer individuals tax and retirement benefit advantages. These plans reduce the employee's gross wages before federal and state taxes are computed. Theoretically, when these funds are withdrawn later in life, the employee is in a lower income tax bracket.

A Summary Explanation of the Plan can be downloaded by selecting: 403(b) Plan Summary Explanation.

A. Eligibility
Employees are divided into the following two classes:

Class A - Class A includes employees whose most recent and applicable appointment period is continuous and are employed and designated in a full-time employment class. Class A employees are eligible to make Elective Deferrals out of their own compensation and receive an Employer Matching Contribution.

Class B - Class B includes employees designated as part-time or temporary. Class B employees are eligible to make Elective Deferrals out of their own compensation; however, they are not entitled to receive Employer Matching Contributions.

Excluded employees are not eligible to contribute to the plan. An excluded employee is a former employee, an independent contractor or a student-employee who is enrolled and regularly attending classes at Auburn University.

B. How much can I contribute?
Federal law limits the amount you may elect to defer under this Plan during the 2014 calendar year to $17,500. If you are over age 50 or turn age 50 during the 2014 calendar year, you may defer an additional amount up to $5,500. These dollar limits may change each year with cost-of-living adjustments issued by the IRS in October.

Please note that the amount you defer must be made in a whole percentage and sent to one vendor at a time. You can increase, decrease or stop your deferral contribution at any time. After completing the appropriate forms, requests shall become effective on the first day of the month following receipt of such change, or as soon thereafter as administratively practicable. Participants who wish to elect to defer 50% or more of his or her Includible Compensation must first contact Auburn University Payroll & Employee Benefits to confirm adequate remaining Includible Compensation to pay for all other benefits for each pay period.

C. Will I receive an employer contribution from Auburn University?
Employer Matching Contributions will be made for eligible employees in amounts equal to 100% of Elective Deferral contributions up to 5% of your Plan compensation. The Matching Contribution cannot exceed $1,650 for any Plan Year (calendar year).

D. When am I vested?
Employee Deferrals are always 100% vested. The Employer Matching contribution is subject to the following vesting schedule:

Continuous Years of Service     Vesting Percentage
Less than Five Years 0%
Five or More Years 100%

E. Investment Options Available
There are several investment options available at four vendors. These options give the investor a wide spectrum of investments ranging from fixed and variable annuities to mutual funds. Detailed information may be obtained by contacting the approved companies listed below:

CompanyRepresentativePhone NumbersE-mail/Web site
Fidelity Investments Andrea Leota
404-330-4815 andrea.leota@fmr.com
www.fidelityatwork.com
Lincoln Financial Group Che' Bailey 866-489-4821 che.bailey@LFG.com
www.LFG.com
TIAA-CREF Jim Hogan 800-842-2003 x 263508 jhogan@tiaa-cref.org
www.tiaa-cref.org
VALIC
(Auburn)
Cindy Haynes
Brian Ledbetter

334-444-1533
334-444-7874
800-448-2542
cindy.haynes@valic.com
brian.ledbetter@valic.com
www.valic.com
VALIC
(AUM)
Michael Probst

334-235-0654
800-448-2542
michael.probst@valic.com
www.valic.com

II.      Deferred Compensation Plan(457) (b)

Deferred Compensation plans are another investment vehicle to defer current income from federal and state income taxation.

A Summary Explanation of the Plan can be downloaded by selecting: 457(b) Plan Summary Explanation.

A. Who is eligible?
If you are a full-time, part-time, or temporary employee, you are eligible to make Elective Deferrals under the Plan out of your own compensation.

Excluded employees are not eligible to contribute to the plan. Under the plan, an excluded employee is a former employee, an independent contractor or a student-employee who is enrolled and regularly attending classes at Auburn University.

B. How much can I contribute?
In addition to contributions made to the 403(b) Plan, Federal law allows you to defer an additional $17,500 during the 2014 calendar year. If you are over age 50 or turn age 50 during the 2014 calendar year, you may defer an additional amount up to $5,500. These dollar limits may change each year with cost-of-living adjustments issued by the IRS in October.

Please note that the amount you defer must be made in a whole percentage and sent to one vendor at a time. You can increase, decrease or stop your deferral contribution at any time. After completing the appropriate forms, requests shall become effective on the first day of the month following receipt of such change, or as soon thereafter as administratively practicable. Participants who wish to elect to defer 50% or more of his or her Includible Compensation must first contact Auburn University Payroll & Employee Benefits to confirm adequate remaining Includible Compensation to pay for all other benefits for each pay period.

C. Will I receive an employer contribution from Auburn University?
You will not receive an Employer Contribution under the 457(b) Plan.

D. When am I vested?
Employee Deferrals are always 100% vested. No employer contribution is made to the 457(b) Plan

E. What are the available investment options?
The Plan has numerous investment options available at three vendors. These options give the investor a wide spectrum of investments ranging from fixed and variable annuities to mutual funds. Detailed information may be obtained by contacting the approved companies listed below:

CompanyRepresentativePhone NumbersE-mail/Web site
Fidelity Investments Andrea Leota
404-330-4815 andrea.leota@fmr.com
www.fidelityatwork.com
VALIC
(Auburn)
Cindy Haynes
Brian Ledbetter

334-444-1533
334-444-7874
800-448-2542
cindy.haynes@valic.com
brian.ledbetter@valic.com
www.valic.com
VALIC
(AUM)
Michael Probst

334-235-0654
800-448-2542
michael.probst@valic.com
www.valic.com
TIAA-CREF Jim Hogan 800-842-2003 x 263508 jhogan@tiaa-cref.org
www.tiaa-cref.org

As an employee of Auburn University, qualified employees may also participate in the 457(k) plan offered by the Retirement System of Alabama, the RSA-1. Additional information may be obtained by contacting RSA at the number below.

CompanyRepresentativePhone NumbersE-mail/Web site
Retirement System of Alabama (RSA-1) N/A
877-517-0020 www.rsa-al.gov

To Enroll in the 403(b) or 457(b) Plan

An eligible employee may enroll in the voluntary retirement plans at any time during the year. Enrolling requires completion of a Salary Deferral Agreement as well as new account forms with the provider of your choice. An on-line calculator is available to assist you with determining your contribution percentages and completing the Salary Deferral Agreement form. To access the on-line calculator, visit How To Complete New Salary Deferral Agreements, or access blank forms for 403(b) and 457(b) here. Salary Deferral Agreements and new account forms are also available at Auburn University Payroll & Employee Benefits located at 212 Ingram Hall. For employees at AUM, forms can be obtained at the AUM Human Resources Office located at 705 Library Tower.

Payroll & Employee Benefits
212 Ingram Hall      Auburn University, AL 36849      Phone 334-844-4183      Fax 334-844-1799

Auburn University | Auburn, Alabama 36849 | (334) 844-4000
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