To help its employees continue to receive retirement income once they retire, Rensselaer has established several types of retirement programs for workers who meet certain requirements.
The Rensselaer Defined Contribution Plan allows employees to contribute 1% of their pay (up to legal limits) and receive a generous 8% employer match. Employees must work full time for three years to be 100% vested (own) in the 8% match account contribution.
Rensselaer also sponsors a 403(b) plan that allows all employees to save money on a pre-tax basis to supplement their retirement income.
Rensselaer expects and intends to continue these Plans indefinitely. However, please note that Rensselaer also reserves its right to end each of the Plans if necessary, as well as to amend each of the Plans at any time.
If you have any questions about Rensselaer's retirement plans, please contact the Division of Human Resources.
Eligible employees will automatically be enrolled in the Rensselaer Defined Contribution Retirement Plan effective the first day of the second month following their date of hire, unless they make an affirmative salary deferral election or elect not to participate. Upon enrollment, the employee will contribute 1% of their earnings to the Employee Plan and will receive a Rensselaer contribution equal to eight percent 8% of the employee's earnings in the Rensselaer Plan. Contributions will automatically be invested in an age-appropriate Lifecycle Investment Fund with TIAA.
Employees who prefer to actively enroll in the Rensselaer Defined Contribution Retirement Plan may elect either TIAA or Fidelity Investment Funds as their Fund Sponsor. To enroll, complete the Retirement Program Enrollment Form and then enroll online with either TIAA or Fidelity. Employees may only elect to have their contributions invested with one Fund Sponsor per year, with the plan running from July 1 through June 30 of the following year. Employees will have the opportunity to change Fund Sponsors each July 1, at which time they may select from among the many investment options for their contributions. Employees should contact the Fund Sponsor directly to change their fund allocations during the plan year.
Please refer to the Summary Plan Description for more detailed information.
What is the vesting schedule?
Employee contributions into the plan are immediately vested. Employees will always be fully vested in — that is, they will always own — the 1% pre-tax contributions they make to the program, and will be entitled to withdraw those contributions (adjusted for investment performance) at any time following their separation from Rensselaer.
After three years of vesting service (not to be confused with three years of employment) employees will own the contributions Rensselaer has made on their behalf, with vesting service counted from the date of employment and not the date the employee began participating in the program. Employees who leave Rensselaer prior to completing three years of vesting service — that is, 720 hours in each of three plan years — will forfeit any contributions Rensselaer made on their behalf. Contact HR to learn if you have met the vesting service requirement.
How are benefits paid?
The form of payment for withdrawn contributions depends on the investment option from which the withdrawal is made. For example, many of the investment options offered by TIAA and Fidelity Investments permit the employee to make a complete, single-sum withdrawal of the entire account balance. Other options, such as installment payments, life annuities, and joint and survivor annuities, are also available, and it is possible for Rensselaer employees to choose a combination of the above options.
Note that employees may withdraw contributions at any time after leaving Rensselaer, but penalties may apply if the employee begins withdrawal prior to age 59 and one-half.
This is a voluntary program that allows employees to set aside money for additional retirement income, without paying any income tax on these savings or on any of the investment income the savings earn until they are paid out.
Eligible Rensselaer employees include faculty, staff, and student workers, as well as those whose annual contribution limit to the tax-sheltered retirement program is at least $200.
Employees may shelter wages from federal and state taxes by electing to defer earnings to tax-sheltered annuities offered at Rensselaer. Fidelity Investments and TIAA offer a wide variety of investment options to Rensselaer employees, including growth funds, income funds, money market funds, and combinations thereof.
The IRS sets limits on the maximum amount Rensselaer employees can contribute to tax-sheltered annuities in a calendar year. Contributions are tax-deferred.
The Internal Revenue Code imposes limits on how much an employee can contribute in a calendar year, otherwise known as a Maximum Exclusion Allowance (MEA), which includes the employee’s 1% contributions to the Defined Contribution Plan (as defined above), plus their contributions to the Supplemental Retirement Program.
In 2019, this limit is projected to be $19,000; for employees who will reach the age of 50 before December 31, 2019, the projected limit is $25,000. (Actual limits for 2019 were not available at the time of printing of this guide.) Employees who have been employed with Rensselaer for 15 years or longer should contact the Division of Human Resources to see if they are eligible for a higher limit.
Employees may choose from a wide variety of investment options — including stock funds, bond funds, stable funds, and combinations thereof — offered by the Fidelity Investments and TIAA investment service organizations.