Academic specialists appointed at 50 percent time or more for a period of nine months or more are eligible to make contributions to a base retirement plan and/or to a supplemental retirement plan.
Base Retirement Plan
Eligibility
Participation in the base retirement plan, with University contribution, is initially optional and required for academic specialists when certain service and/or age requirements are met. The general rules follow:
- Academic specialists with probationary or continuing appointments of 50 percent time or more may elect immediate participation with University contribution. A specialist who does not have a probationary or continuing appointment will become eligible for the University contribution 24 FTE service months from the date of initial appointment. Participation for all specialists is required after 24 FTE service months and attaining age 35.
- Once required participation commences for academic specialists appointed for nine months or more, it is not possible to withdraw from the base retirement plan while employed at the University.
- Academic specialists appointed 50 percent time or more previously enrolled in a 403(b) or 403(b)(7) contributory retirement program before appointment at MSU may elect immediate participation.
- Participation in the base retirement plan is possible at any time without University contribution.
- Academic specialists enroll in the base retirement plan by submitting a signed application to the Benefits Office prior to the first of the month the application is to be effective. Failure to apply prior to the first of the month in which academic specialists are eligible for the University contribution will result in lost contribution without retroactive recovery.
Coverage
The base retirement plan provides a retirement income based upon the total amount accumulated from the employee's contribution, the University's contribution, and the earnings on those amounts over the period of the working years.
The base retirement plan is fully vested indicating that both the academic specialist's and the University's contributions are placed directly in the academic specialist's account each month. In the event the academic specialist leaves the University, ownership of the total accumulation is retained by the academic specialist. An academic specialist may commence to draw his/her accumulation under a variety of payment options after leaving the University. The academic specialist may elect to receive an immediate retirement income or may defer the receipt of his/her retirement income until a later date. Cash withdrawal options are available if age 55 or older, and terminated or retired.
Cost
The base retirement plan is financed by a reduction of 5% from the academic specialist's base salary and a matching University contribution of 10%.1
Supplemental Retirement Plan
Academic specialists appointed at 50% time or more for a period of at least nine (9) months may make additional tax-deferred contributions to the supplemental retirement plan subject to IRS limitations. Participation in the supplemental retirement plan is never required, and no matching contribution is made by MSU.
Other Retirement Information
- To be considered an "official" retiree from Michigan State University, academic specialists must meet one of the following minimum University retirement requirements:
- a. Be at least 62 years of age and have completed 15 years of service, or
- b. Have completed 25 years of service at any age.
- Academic specialists meeting the minimum University retirement requirements will remain eligible to maintain health and dental coverage and receive a University contribution toward the premiums based on the number of full-time equivalent (FTE) service months at retirement. Retirees (their spouse or same-sex domestic partner) age 65 and over are required to enroll for Medicare Parts A & B at which time MSU's health plan coverage is adjusted to a Medicare supplement policy. Medicare Part B requires a monthly premium that is not reimbursed by MSU. Individuals may contact their local Social Security office for information on the monthly premium cost for Medicare Part B.
- Academic specialists meeting the minimum University retirement requirements may continue participation in the employee-paid life program after retirement until age 70.
- Academic specialists participating in the employee-paid life plan at the time of retirement and who were enrolled prior to July 1, 1976 will receive a $2,000 life benefit fully paid by the University.
- Academic specialists employed prior to July 1, 1958, who meet the minimum University retirement requirements as defined above, may have "frozen benefits" from the University Non-Contributory Retirement Plan in addition to their base retirement plan. Full information is available from the Benefits Office.
- Retirement survivor options which protect the spouse, if any, are available and may be selected immediately prior to retirement. In the event a survivor option is selected, the spouse is guaranteed payments for life. Spouses of retired academic specialists are guaranteed lifetime participation in the health and dental plans.
============
Next: 8.4 Academic Specialist Benefits in the Event of a Leave of Absence, Termination, or Death
Previous: 8.2 Optional Benefits
Index: Academic Specialist Handbook