Updated : Sep 11, 2019 in Articles

Faculty, Administrative and Professional Staff, and other Nonunion Staff Retirement Programs


While today you might be thinking about
your new role, it’s never too early to start thinking about saving for tomorrow.
At Harvard we provide many opportunities to help you save for the retirement you
envision. Harvard offers three retirement programs: 1. The Tax-Deferred Annuity Plan, 2. The University Funded Retirement Programs and 3. The 457b Deferred
Compensation Plan. Let’s start with the Tax-Deferred Annuity Plan or TDA plan. As soon as you begin working, you can start contributing to the TDA plan through
convenient payroll deductions. There are two ways you can contribute to the TDA:
Select the Traditional option to make your contributions before you pay taxes, which saves you money on taxes now. Or, select the Roth option to contribute
after you pay taxes, and enjoy tax-free withdrawals in retirement. Want a little
of both? You can also divide your contributions between the Traditional
and Roth options. Please note, if you’re an employee at HBS Publishing, Dumbarton Oaks, or the Center for Hellenic Studies, you are not eligible to make Roth
contributions. You can invest your contributions in options from Harvard’s
three vendors – Fidelity, TIAA, and Vanguard. Because saving early is so important, you
will be automatically enrolled in the TDA plan 60 days after your start
date unless you’ve already enrolled in the plan. Here’s how it works: 3% of your eligible pay will be deducted on a pre-tax basis and
invested in the Vanguard target-date fund that most closely matches the year
in which you will turn 65. Your contributions will increase by 1% each January, until you reach 10% of your salary, or the annual
limit set by the IRS. Keep in mind that you can change your contribution and
investment elections at any time, including directing some of your
contributions to a Roth TDA. You can opt out at any time. You’ll receive
information about this plan in the coming weeks. In addition to the TDA plan, Harvard
offers two University-funded retirement programs for eligible faculty and staff.
The Retirement Income Plan for Teaching Faculty is for teaching faculty,
including certain instructors and lecturers who work at least half time
and are at least 21 years old. And the 2001 staff retirement program is for
eligible professional and administrative staff, and other non-union staff. To be
eligible, you must be regularly scheduled to work at least half time, or 17.5 hours per week and be at least 21 years old. What’s great about these two
plans is that Harvard makes 100% of the contributions. Harvard starts
making contributions after you’ve been employed for 6 months, and the payments are retroactive to your start date. If you’re under age 40, Harvard will make
contributions equal to 5% of your pay up to the Social Security wage base, and 10%
of your pay for earnings above the Social Security wage base. If you are
age 40 or older, Harvard will make contributions equal to 10% of your pay
up to the Social Security wage base and 15% of your pay for earnings above the
Social Security wage base. You have the freedom to invest these
contributions in funds you choose from Harvard’s 3 vendors – Fidelity, TIAA,
and Vanguard. If you don’t actively select investments,
contributions will be automatically invested in the Vanguard target-date
fund that most closely matches the year in which you will turn 65. Participants
are generally vested after 3 years of employment. That means the money is yours to keep if you leave the University or retire. You’ll receive
information about this plan several weeks before you become eligible. Finally there’s the 457b Deferred Compensation Plan which is designed for certain
highly compensated faculty and staff members. If you are eligible for this
plan, you’ll receive more information from the Harvard University Retirement
Center, or HURC. You can start saving for your tomorrow by taking advantage of
these retirement programs today. If you have questions, simply review your
benefits enrollment guide, or visit hr.harvard.edu/retirement. There
you’ll also find the Summary Plan Description which provides further
details.

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