Employee Savings 403 (b)(7)

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Employee Savings 403(b)(7)- General Information

Financial Planning / Asset Allocation

Retirement Savings Plan Maximum Contributions for 2008

Special Note

 
Employee Savings 403(b)(7) - General Information

All employees may voluntarily contribute pretax dollars to a 403(b)(7) Tax Deferred Annuity Plan (employee savings), up to the maximum exclusion allowed.  There is no waiting period and vesting is always 100%.  Funds may be invested through TIAA/CREF, Fidelity Investments Inc., or Vanguard Company.  The Office of Human Resources will provide enrollment material and information about options but the participating employee directs all investment choices within the vendor(s) selected. Accessibility to funds is governed according to the Internal Revenue Code for 403(b)(7) plans.

Financial Planning / Asset Allocation

In order to help employees make retirement investment and planning decisions, the Office of Human Resources provides the following basic services:

  • assistance in completing forms,
  • references to information about investment fund performance,
  • facilitation of form processing with vendors,
  • financial planning seminars and workshops.

Once an employee has invested funds with a vendor, fund allocation, investment fund balance(s) and other information may be obtained from the vendor via telephone or on line (vendor links).

Because the IRS tax code strictly limits the amount individuals may contribute to a retirement plan on a pretax basis, it is important that individuals not exceed their personal Maximum Exclusion Allowance (MEA) limit. Generally, if an individual chooses to contribute 9% or more of their income to a retirement fund under the 403(b)(7) tax-deferred annuity plan, or if an individual shelters 20% or more of their income from taxes (i.e., parsonage allowance, medical or dependent care flexible spending accounts), the Office of Human Resources will process one MEA calculation per year for the individual. This annual service takes place in December. However, when an individual falls into the aforementioned categories, any change to an individual's salary or tax-sheltered income status would necessitate that a new, additional MEA be processed. The employee who experiences such a change in income status is responsible for requesting that the Office of Human Resources assist in processing a new MEA calculation.

Retirement Savings Plan Maximum Contributions for 2008

The Economic Growth and Tax Relief Reconciliation Act of 2001 provided increased retirement savings opportunities for employees.  If you make contributions or are planning to make contributions to the voluntary tax-deferred 403(b)(7) retirement savings program, following are the maximum contribution limits for 2008.  If you are not contributing to your 403(b)(7) you may begin making contributions or change your investments at any time.

 

Generally, your voluntary contribution to the 403(b)(7) program is limited to $15,500 in 2008.

    • The overall limit for combined retirement contributions to your own 403(b)(7) plan plus contributions from SPU to your 401(a) plan   is the lesser of 100% of your salary or $46,000.  SPU contributes 9% of salary to the  401(a) plan for eligible employees. 
  • The 15-year rule continues to apply, allowing employees with 15 or more years of service at SPU to make up to $3,000 in voluntary contributions beyond the basic $15,500.    Prior contributions made under the 15-year rule are taken into account and a calculation must be performed to determine your personal maximum contribution.  If your service exceeds 15 years and you want to contribute more than $15,500 to the 403(b)(7) use one of the calculators listed below determine the correct amount.

 

403(b)(7) max contribution tools

  •  For individuals over age 50, an additional contribution of $5,000 to the 403(b)(7) program is allowed, but only after the annual 15-year rule annual maximum is reached (if any). 
  • You may take advantage of both the 15-year rule and the over-age-50 rule, if both rules apply.

 

You can change the amount you contribute to your 403(b)(7) account at any time by completing a new 403(b)(7) Salary Reduction Agreement form.

 

If you want to contribute more than the $15,500 annual limit, calculate your new monthly contribution amount by using the Fidelity or TIA-CREF web calculators shown above.  Print out the worksheet

 

Submit the completed Salary Reduction Agreement form and your calculation worksheet (if any) to Jackie Belz in Human Resources.  Call Jackie Belz x2837 with any questions.

 

To change the investments within your 401(a) or 403(b)(7) plans you can directly contact:

    • Fidelity -  Fidelity Retirement Specialist at 1-800-248-4193
    • TIAA-CREF -  Telephone Counseling Center at 1-800-842-2776
    • Vanguard –  Investor and Client Information  1-877-662-7447 [403(b)(7) plan only]

 
Special Note

The above Retirement and Tax Deferred Annuity plan information and details are a summary of these benefits. The actual plan documents take precedent over the information printed in this booklet. The University reserves the right to make changes to these benefit plans at any time, at the University's sole discretion. If such changes are made, you will be notified. For more information, please contact the Office of Human Resources at 281-2809.