Retirement Plan Contribution Limits Increase in 2007! For more detailed information, click here.
Participation in a retirement plan is mandatory for permanent employees working 75% time (30 hours) or more. (Employees working less than 75% time cannot participate.) Employees must contribute 6% of salary, deducted prior to Federal and State income taxes, to the retirement plan and are vested after five years of participation. (Note: Employees may contribute more than 6% for retirement through a Supplemental Retirement program [see below]).
The three retirement programs available to UNCW employees are:
• Teachers’
and State Employees’ Retirement System (TSERS)
• Optional
Retirement Program (ORP)
•
Teachers' and State Employees' Retirement System For State Law Enforcement
Officers (LEO)
In addition, the university offers a Phased Retirement Program for tenured faculty.
Teachers and State Employees Retirement Plan (TSERS)
Eligibility: Available to permanent SPA employees (staff employess subject to the NC Personnel Act) or EPA employees (administrators and faculty exempt for the NC Personnel Act) working 30 hours or more per week. Employees contribute 6% of salary per month.
TSERS is a defined benefit plan. With a Defined Benefit Plan, benefits are based on salary, years of service and a retirement factor. The retirement benefit is not based on the amount of contributions nor the investment earnings. There is no investment risk for the individual since the state takes on the risk and guarantees the retirement benefit. TSERS is not “portable” except to other North Carolina state agencies, including the 16 constituent institutions of the UNC System, NC Community Colleges, and NC Public Schools.
The retirement benefit for a defined benefit plan is based on a formula and not on the amount you or the state contribute. The formula for TSERS is determined by state statute and is:
• Average salary based on the highest 48 consecutive months of
earnings
• Multiplied by a Retirement Factor of 1.82%
• Multiplied by your creditable years of service
The University contributes an amount set by the state legislature each year which funds the:
• Retirement benefit
• Retirees' Health Care plan
• Disability Income benefit
• Death benefit
The University contribution to TSERS is not a match to your contribution, it can change each year and does not go into the same account as your 6% contribution.
You qualify for full (or unreduced) retirement benefits with:
• 30 years of creditable service at any age or
• 25 years of service and age 60 or
• 5 years of service and age 65
You qualify for a reduced retirement benefit with:
• 20 years of service and age 50 or
• 5 years of service and age 60
Options at termination of employment differ depending on whether or
not you are vested:
Less than 5 Years of Service (Not Vested):
• You can withdraw your contributions as a lump sum or as a direct
rollover to an IRA. By withdrawing your funds, you lose your contributory
years of service.
• If you expect to be employed by the State of North Carolina in
the future, you can leave your contributions in the plan. You
do not lose your contributory years of service.
More than 5 Years of Service (Vested):
• You can leave your contributions in the plan. When you are eligible
for and begin receiving a monthly retirement benefit from the plan you
will also be eligible for the retiree health insurance.
• You can withdraw your contributions plus interest as a lump sum
or as a direct rollover to an IRA. By withdrawing your funds you forfeit
your rights to retiree health insurance. You also lose your contributory
years of service.
For detailed information about TSERS, including full (or unreduced) and reduced retirement benefits, death benefits, survivor benefits, please see the TSERS Handbook.
Retirement
System homepage
TSERS
Estimate of Benefits
TSERS
Applications and Forms
TSERS
Purchasing Service Credit
Choosing
a Retirement Program (for employees eligible for TSERS or ORP)
Optional Retirement Program (ORP)
Eligibility: Available to permanent tenured faculty, tenure-track faculty, EPA administrators, and EPA research and instructional non-faculty employees. Employees contribute 6% of salary per month.
The ORP is a defined contribution plan. With a Defined Contribution Plan, retirement benefits are based on the accumulation (your contributions, the university contributions and the interest and dividends earned) and your age at the time you begin the benefit. Since you select the investment vehicle(s) for the contributions you assume the investment risk for your retirement plan. See Choosing a Retirement Program.
The annual retirement benefit for the Optional Retirement Program (ORP) is based on:
• Your final accumulation in the plan (contributions, investment
and dividend earnings)
• Your age at the time you begin the benefit
• The method of payment you elect at the time of retirement.
The University contributes an amount set by the state legislature each
year that funds:
• Your retirement account with the ORP carrier
• Retirees' Health Care Plan
• Disability Income benefit
University contribution:
• 6.84% to your retirement account with the ORP carrier
• 3.20% to the Retiree Health Plan
Under the ORP, you have a number of choices to make regarding your retirement fund. First, you must choose from the four carriers, and they you must select from the different investment funds to meet your investment objectives and goals. The four carriers are:
• Fidelity
Investments
•
Lincoln Financial Group
• TIAA-CREF
• VALIC
You may elect to allocate both yours and the university's contributions
to one carrier or you may allocate your contributions to one carrier and
the University's contributions to another carrier. You can change which
carrier either of the contributions go to at anytime.
The UNC Office of the President published a quarterly comparison
of fund performance for all funds available through the ORP. If you
have questions about fund performance, please contact the ORP carrier
directly. Past performance is not necessarily an indicator of future performance.
Options at termination of employment differ depending on whether or
not you are vested:
Less than 5 Years of Service (Not Vested):
• You can withdraw your contributions and earnings as a lump sum or roll them over to an IRA or another qualified plan. The University's contributions are returned to the UNC system and transferred to the State Retirement System.
• You can leave your contributions in the plan. The University's contributions return to the UNC system.
• If you expect to be employed by an institution of higher education that offers a "like" retirement plan using one of the carriers offered through the ORP and you participate in that plan within 12 months of leaving UNC, you can leave your contributions in the plan and be considered 100% vested; you will retain both your contributions and the university contributions and all earnings.
More than 5 Years of Service (Vested):
• You can keep your contributions, the university contributions and all interest and earnings in the plan and retain your right to the state retiree health insurance. Retiree health insurance is a benefit only when you are receiving monthly retirement income from your ORP carrier.
• You can withdraw your contributions, the university contributions and all interest and earnings as a lump sum or as a direct rollover to an IRA or another qualified plan, as permitted by the ORP carrier. By withdrawing your funds you forfeit your rights to retiree health insurance.
TSERS or ORP - Considerations
• Willingness to assume investment risk - the
individual assumes the investment risk with the ORP.
• Your age - Generally, plans like TSERS favor
employees who are hired and begin participation at ages 45 or older who
plan to continue employment at UNC for the rest of their career. ORP plans
generally favor employees who enter the plan younger, regardless of whether
they participate in the plan for an extended time.
• Importance of Portability - TSERS is portable
if you will be going to other North Carolina state agencies (including
the 16 constituent institutions of the UNC system, Community Colleges,
Public Schools and all Agencies and Departments of the State), ORP is
portable if you will be going to other Universities and participating
in a "like" plan.
• Years of Service you have with the State - Generally,
TSERS favors employees whose years of service will provide full (unreduced)
retirement benefits at the time of retirement.
• Preference for receiving a guaranteed retirement benefit
based on years of service and salary - TSERS provides a guaranteed
retirement benefit, the ORP does not since it is a defined contribution
plan.
For more information contact Kelly Kennedy, HR benefits counselor for faculty and administrators, at 910-962-3006 or kennedyk@uncw.edu or contact the UNCW representative for each carrier:
VALIC
David Haden, CFP
Senior Financial Advisor
910-791-4659
david.haden@valic.com
Fidelity Investments
Katie Taylor
Retirement Counselor
1-866-588-2619
katie.taylor@fmr.com
Lincoln Financial Group
Paige Lowry
Retirement Consultant
1-888-548-4704
plowry@lnc.com
TIAA-CREF
Mike Keely, CMFC
Individual Consultant
1-877-267-4505
mkeely@tiaa-cref.org
Employees wising to contribute more than 6% of salary to retirement should see Supplemental Retirement Plans.
Teachers' and State Employees' Retirement System For State Law Enforcement Officers (LEO)
Eligibility: Permanent full-time law enforcement officers. Employees contribute 6% per month.
LEO is a defined contribution plan for law enforcement officers only. Benefits are based on salary, years of service and a retirement factor. The retirement benefit is not based on the amount of contributions nor the investment earnings. There is no investment risk for the individual since the state takes on the risk and guarantees the retirement benefit.
The retirement formula for LEO is determined by state statue and is:
• Average salary based on the highest 48 consecutive months of
earnings
• Multiplied by a retirement factor of 1.82%
• Multiplied by years and months of creditable service
Law enforcement officers qualify for full (or unreduced) retirement benefits as follows:
• 30 years of creditable service at any age or
• Age 55 and five years of creditable service as an officer
Law enforcement officers qualify for reduced (early retirement) benefits at:
• Age 50 and 15 years of creditable service as an office
Early retirement benefits are determined by the same formula as unreduced retirement benefits multiplied by a reduction percentage based on your age and/or service at early retirement. The reduction percentages can be found in the Retirement Handbook.
For more information contact Elizabeth Greene, HR benefits counselor for law enforcement officers, at 910-962-3173 or greenem@uncw.edu. For detailed information about LEO please see the LEO handbook.
Retirement
Forms
Retirement
Estimator
Additional Benefits to Law Enforcement Officers
As a law enforcement officer you are automatically enrolled in the State of North Carolina 401(k) Plan and the university contributes 5% of your salary into your account in the Plan. You may elect to make additional contributions on a tax-deferred basis.
Additional Information
If you would like information about supplemental retirement plans (401k, 403b or 457 deferred compensation) please go to supplemental retirement plans.
Disclaimer: The information contained on this website is general in nature. Applicable laws and regulations are complex and subject to change. Information on this website cannot alter, modify, or otherwise change the controlling documents of any plan. For legal and tax advice employees should consult an attorney or tax adviser.
