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Changes to the University Retirement Program

Written By the University Retirement Program (retirementprogram@hr.rochester.edu)

Recently, plan participants received information about the 403(b) Retirement Program and Deferred Compensation 457(b) Plan changes coming in July. These changes impact your Retirement Program accounts, how new plan loans will work and options available for future investment. As a result, there is no required action unless you want to make changes to your account.*

The sections below summarize the changes. View the full mailing and Frequently Asked Questions (link) for detailed plan change information.

Webinars & Information Desks

  • Attend a webinar to learn more about the updates.
  • Have just one or two questions to ask? Consider stopping by an information desk to learn more.

If you have additional questions or would like more information, contact TIAA at 800-410-6497.

 

NEW 403(B) PLAN ACCOUNTS:

RETIREMENT CHOICE (RC) AND RETIREMENT CHOICE PLUS (RCP)

As a part of the changes being made, participants in the Retirement Program will be issued new accounts. Participants will automatically be enrolled in the new RC and RCP accounts on July 6, 2018. You can expect to receive a TIAA welcome package mailed to your home address the following week. Your current beneficiary designation(s) will be applied to your new account(s).

 

HOW YOUR FUTURE CONTRIBUTIONS AND CURRENT ACCOUNT BALANCES WILL BE AFFECTED

Commencing July 6, 2018, your future contributions will be made to the new RC and RCP accounts as described in the table below. Of course, you can change these elections at any time. New contributions, rollovers or transfers may not be made to the old accounts.

During the week ending July 13, 2018, your mutual fund balances will be transferred in kind to the new RC and RCP accounts as an overnight process.**  Amounts in the TIAA and CREF investments under the old accounts prior to the transfer will remain in the old accounts.

The table below details how your accounts will change.

*If you have automatic annual rebalancing, you may need to re-establish instructions on the new account. You will receive separate communications if this change applies to you.

** If you have systematic withdrawal instructions on file with TIAA, your balances will not be transferred to the new RC and RCP accounts.

 

INVESTMENT OPTION CHANGES

NEW INVESTMENT OPTIONS
Detailed information about the new investment option and other investment options offered under the plans is available on TIAA’s website.
On July 6, 2018, the following investment option will be added:

This change requires no action by you unless you would like to start investing in these investments.

 

FROZEN INVESTMENT OPTIONS

As of July 6, 2018, no new contributions will be permitted to the following investments: TIAA Traditional Annuities under the RA, GRA, SRA and GSRA accounts, CREF Money Market Account R3 and CREF Stock Account R3. If you are currently contributing to one of these investments as of July 6, 2018, future contributions will be automatically invested in the replacement investment options as shown in the chart below, unless you change your allocation by 4 p.m. (ET) on July 12, 2018.

Your account balance(s) invested in the frozen investment options as of July 6, 2018, will remain as currently invested. You can transfer amounts out of the frozen investment options subject to applicable transfer restrictions. If you prefer to direct future contributions to a different investment option or transfer out of the frozen investments, log into TIAA or call 800-410-6497.

PLAN LOANS

Effective July 6, 2018, new Retirement Plan loans will only be offered from the new RCP account.

  • Starting July 6, 2018, if you take out a loan, it will be offered with a fixed rate of interest and funded directly from your retirement The loan amount is deducted from your plan accumulations, and subsequent loan payments, including interest, are credited to your account.
  • If you take out a loan, you will be assessed a one-time origination The fee is $75.00 for general purpose loans and $125.00 for residential loans.
  • The maximum number of outstanding Retirement Plan loans will be limited to three.
  • Outstanding loans as of July 6, 2018, will not be impacted and will remain in place, inclusive of participants with more than three outstanding loans.

The chart below highlights the features of the old and new loan types.

†Collateralized assets are restricted from taking withdrawals, transfers or annuity income. For GSRA, collateralized assets are commingled with other assets in the account.

 

UNIVERSITY’S DIRECT CONTRIBUTION FORMULA BREAKPOINT FOR 2018

Effective with the plan year beginning July 1, 2018, the University’s Direct Contribution is 6.2% of base salary up to the breakpoint of $57,500, then 10.5% of base salary in excess of $57,500, up to the IRS limit ($275,000). In addition, the IRS limit [IRS Code Section 401(a)(17)] will increase to $275,000. For additional information on the University’s Direct Contribution calculation, click here.

 

For More Information

We are here to support you through this change. For more information, sign up for a webinar, visit an information desk, or contact TIAA to schedule an in-person or phone advice session by calling 800-410-6497, weekdays, 8a.m. to 10p.m., and Saturday 9a.m. to 6p.m. (ET).