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eRaven

 

Teachers Insurance and Annuity Association (TIAA)

 

Franklin Pierce University offers a comprehensive retirement plan that:

Provides you with an employer contribution based on eligibility and years of services always vested at 100%.

Encourages you to invest your own voluntary contribution.

Offers a broad spectrum of investment choices through Teachers Insurance and Annuity Association (TIAA).

Regardless of your age, the time for thinking about retirement is now. With careful planning, you can help make your retirement years a more comfortable and secure time of life for you and your family.

When am I eligible to for Franklin Pierce contribution to my retirement plan?

If you have worked for an Institution of Higher Education for at least twelve (12) consecutive months in a full-time position, you will be eligible for employer contributions the first of the month following thirty (30) days of employment.  You will need to submit a letter from that institution of Higher Education verifying your employment.

If you have not worked for an institution of Higher Education full-time for twelve (12) consecutive months, you will be eligible for employer contributions the first of the month following one (1) year of service working at least 1000 hours.

All faculty and staff can contribute and/or change voluntary contributions at any time. The IRS maximum voluntary contribution in 2019 is $19,000.

You must be at least 21 years of age at the time you are eligible.

Start or change your voluntary contribution by completing the Salary Reduction Form 403(b).

See the chart below for the contributions that Franklin Pierce makes toward your retirement.

Full-Time Staff & Faculty

Years of Service Completed as of

January 1st

University Contribution Rate

0 – 3 years

7.50%

4 – 10 years

8.50%

11 – 15 years

9.50%

16 + years

10.00%

Full-Time RFF Faculty Only

Years of Service Completed as of

January 1st

University Contribution Rate

0 – 3 years

7.00%

4 – 10 years

8.50%

11 – 20 years

11.25%

21 + years

13.50%

You do not pay income taxes on your portion that you contribute to the retirement plan until a withdrawal is made. Tax savings means it costs you less to contribute to the plan than if you were to contribute an equal amount to a regular savings account.

You actually reduce your current income taxes. Compared with taxable investments outside the plan, contributing to your workplace savings plan can increase your take-home pay! See chart below:

 

Tax-deferred Plan

Taxable account

Annual Gross Salary

$30,000

$30,000

6% pre-tax contribution

$1,800

$0

Taxable income

$28,200

$30,000

Less 25% federal income tax

$7,050

$7,500

$1800 after-tax contribution to a taxable account outside of the plan

$0

$1,800

Take home pay after taxes

$21,150

$20,700

Annual difference in take home pay

$450.00

This hypothetical example is for illustrative purposes only. It shows the impact on take-home pay of a pre-tax vs. an after-tax annual contribution based solely on an assumed 25% federal income tax rate. Actual taxes and tax savings will depend on your individual tax situation. “Take-home pay after taxes” does not take into account any payroll deductions except the assumed income taxes noted above.

You can start contributing now instead of waiting, it may make a big difference in how much you might have on hand when you’re ready to retire.  See example below:

If you start contributing at age 25....

You contribute $200 a month to your retirement plan.

When you reach 65 you will have approximately $383,393 in your retirement plan.

If you start contributing at age 35....

You contribute $200 a month to your retirement plan.

When you reach 65 you will have approximately $195,851 in your retirement plan.

This is purely hypothetical and is not intended to predict or project returns.  Actual returns will vary.

If you are enrolled in a high-deductible health plan and have a Health Savings Account (HSA) you can save money for your retirement here too.

If you are going to turn age 50 in the current calendar year and contribute the IRS maximum allowed ($19,000) you can make additional catch-up contributions.

What are catch-up contributions? Catch-up contribution is intended to help you accelerate your progress toward your retirement goals.  The catch-up amount is an additional $6,000 contribution for 2019.

You are able to change the amount of your contribution at any time during the year.  You may also terminate your contributions at any time; once you stop you can start your contributions again at any time.

If you have an existing qualified retirement plan (pre-tax) with your former employer, you are able to transfer or roll over that account into FPU 403(b) plan at any time

How do I rollover my past employers retirement plan?

Reach out to your previous employers Human Resources Department.

Your former employer will be able to tell you what you will need to do to rollover your plan to FPU plan.

TIAA has a robust investment line-up you can view online. 
Visit
www.tiaa.org/public/tcm/franklinpierce to review your options, change your beneficiary, check the status of your earnings or change your personal information.

(800) 842-2888

Valic information
For employees who hold a Valic account, please reach out to Valic directly at (800) 448-2542.

 

 

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