Plan C

Staff Non-Contributory Retirement Plan, "Plan C"

If you were hired on or after July 1, 2015, you are eligible for this defined contribution plan after one year of service with Case Western Reserve or upon employment with at least one year of service from another university or related research institution. The university contributes monthly based on six percent of your pay into a qualified investment account with one of two investment carriers, TIAA or Vanguard.

There are no employee contributions. Benefits vest after three years of service.

Retirement Plan Change for Select Staff Hired After June 30, 2015

As of July 1, newly hired staff who are not executives or senior staff will participate in a retirement plan known as a 403(b) account. Under this model, employees may choose how to allocate retirement savings among investment options managed through TIAA and Vanguard.

This program, known formally as the Staff Non-Contributory Retirement Plan (SNCRP), will be listed as “Plan C” within our benefits offerings. For new staff members, this model replaces the program known as Plan B, also known as a defined benefit plan. Under Plan B, the university contributes and manages those funds designated for retirement—that is, the individual does not have the option of choosing among different investment options that TIAA and Vanguard provide. Again, those staff already in Plan B will continue in it as they have been.

Case Western Reserve is providing this 403(b) program to select new staff in accordance with accelerating national trends across the private sector and higher education, as well as more recent changes to federal legislation. The 403(b) model gives employees greater control over their retirement investment options, and at the same time gives the institution a more complete and consistent sense of the annual resources it needs to devote to retirement programs. This model will enhance Case Western Reserve’s ability to plan over the long term and to continue to be competitive in the compensation, benefit and retirement programs offered to all employees.

All newly hired staff eligible for the Staff Non-Contributory Retirement Plan “Plan C” will receive detailed written information regarding retirement plan options and regular opportunities to meet with representatives of TIAA and Vanguard. Current employees who have questions can attend one of this month’s open information sessions.

These changes do not apply to faculty, executive or senior staff appointments effective July 1 or later.

Why is the university making this change?

Case Western Reserve competes for talented employees within the Northeast Ohio region and across the nation. The university’s ability to recruit and retain outstanding faculty and staff depends on the stability of its overall finances and the appeal of its compensation and benefit packages.

To that end, the university closely follows employment-related trends within higher education – in particular with regard to peer institutions within the American Association of Universities (AAU). Administrators also track compensation and benefit developments within this region for campus positions that draw significant numbers of candidates from the immediate area.

Through this ongoing benchmarking, we recognized local and national trends away from defined benefit plans – the existing Plan B – and toward defined contribution plans – the new 403(b) model, which the university will call Staff Non-Contributory Retirement Plan "Plan C". The latter option gives employees the opportunity to make their own retirement savings investment choices, rather than the university as sole managers of their funds. In addition, the structure of the 403(b) option gives the university greater ability to plan long term, in that the university’s costs fluctuate far less.

Does this announcement mean that current employees face no changes just for next year, or is this the only adjustment to retirement offerings for the foreseeable future?

The university has no immediate plans to make changes to other retirement offerings. That said, officials will continue to monitor employment trends in higher education nationally and the local market. In addition, changes to federal law also can affect what moves the university must or should make. Any future changes at Case Western Reserve, then, will depend on developments across top colleges and universities, relevant local industries, and within Congress

How can I learn more about my retirement options?

You can direct initial questions to the benefits office of Human Resources at call 216.368.6781 or e-mail AskHR@case.edu.

You also can meet directly with representatives of TIAA and/or Vanguard. View the schedule of on-campus availability.

What if an individual hired after June 30 worked previously at the university and was enrolled in Plan B then? Does he or she go back into Plan B or into Plan C?

Those who worked at the university previously and have returned after more than an extremely brief absence will be enrolled in the new Plan C.

Those employees now in Plan B who are laid off or whose positions are eliminated under a reorganization may remain in Plan B if they return to a university position within 12 months.

What is the difference between executive and senior staff in Plan A and the staff in Plan B or Plan C?

Executive and senior staff are those in positions with grades 18 and higher. Staff in Plan B or C are in grades below 18.

Supplemental Retirement Plan C

Supplemental Retirement Plan C provides the opportunity for you to participate in the voluntary supplemental 403(b)(7) retirement plan, which allows you to contribute either to a tax-deferred retirement plan with the university matching a portion of your contribution and/or to an after-tax Roth retirement plan with no university match. On tax-deferred contributions, the university will match 50 percent of your contribution, up to the first four percent of your salary.

Supplemental retirement contributions are limited by IRS maximum contribution allowance of $18,500 for 2018.

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What is Plan C-Matching?

It is an optional, supplemental retirement plan which allows you to contribute to a tax-deferred retirement plan with the university matching a portion of your contribution and/or to an after-tax Roth with no university match.

How much does CWRU contribute to the tax-deferred option?

Case Western Reserve University will match 50 percent of your contribution up to the first four percent of your salary. For example, let's say your salary is $2,000 per month. If you invest $100 (or five percent) of your pay, the University will match 50 percent of $80 (four percent of contributed salary), contributing $40. A total of $140 will go into your supplemental retirement account each month.

How will it grow?

The interest and dividends you earn on your Plan C retirement contribution will grow tax-deferred until your retirement. Since all your earnings are reinvested without taxation, your savings will compound faster. You choose the mix of investments in your Plan C-Matching account, and the growth of your account will depend upon the type of funds you choose.

How do I begin?

You will need Salary Reduction Agreement form. Benefit forms can be obtained online as well as in the Benefits Office of Human Resources, Crawford Hall, room 320. In addition, you will need to complete the online enrollment for the investment firm.

What if I already have a supplemental retirement account?

You must still enroll in the Plan C-Matching tax-deferred option to receive the university match.

How long do I have to work for the university before I am able to participate in Plan C-Matching?

Newly hired employees are eligible beginning with their first full month of employment. As a benefits-eligible employee, you may begin participation at any time during the calendar year.

When I terminate my employment with the university, what happens to the money I have in my supplemental Plan C-Matching?

You may leave your funds in the account, roll them over to an individual retirement account (IRA), or cash out the account any time after termination (cash withdrawals may incur penalties).

Where can I invest?

Each investment company offered by Plan C-Matching gives you the choice of investing in stock mutual funds, bond mutual funds, short-term reserve funds (money market accounts), and balanced mutual funds (made up of stocks, bonds, and short-term reserves). In addition, you have annuity funds available from TIAA. Each investment has a different level of risk and a different opportunity to earn money.

Some investments are riskier than others. The more risk you are willing to take, the better the chance for higher returns on your investment.

Schedule an appointment today to have your financial questions answered by an expert consultant.

Date and Location: See upcoming counseling information
Time: 8:30 a.m. to 5 p.m.
 

Why should I use Plan C-Matching?

In the world of investment opportunities, there are several reasons why you should open a Plan C-Matching account.

  • You choose to contribute tax-deferred with an employer match or after-tax based on your individual needs.
  • Contributions are convenient. Payroll deduction is automatic. You don't need to remember to write a check. You can start immediately.
  • You're in control. Match your investment goals to a wide range of investment choices.
  • University match on tax-deferred contributions only. Remember the university helps you to contribute to your retirement.
  • University matching contributions are 100% vested immediately.

How much can I contribute to my Plan C-Matching account?

The Internal Revenue Service has strict guidelines regarding the amount you are allowed to contribute. These guidelines are called the Maximum Exclusion Allowance (MEA).

What is a Maximum Exclusion Allowance?

The maximum exclusion allowance is the maximum amount that an individual may put into a pre-tax supplemental retirement account during the tax year. It is an individualized calculation that takes several factors into account.

How do I obtain a Maximum Exclusion Allowance?

TIAA does a calculation each year for all members of the CWRU staff and faculty who are employed as of December 31 of the previous year. All new employees may call TIAA at 1-800-842-2733 ext. 2929 for an individualized calculation. When you call be ready to give your hire date, your annual salary, what you will actually earn this year at CWRU.

What is the 15-Year Rule?

Employees who have worked at CWRU for 15 years or more may be eligible for a special exemption from the 2016 $18,000 yearly limit. This is not automatic. Employees should have their MEA calculated to see if they are eligible.

If an employee is eligible, they may be able to contribute up to $21,000 in a single year. If an employee remains eligible for the 15-Year Rule, they can continue to contribute beyond the limit a year up to a point where a total of $15,000 extra has been deferred—at that point the employee must return to the standard 403(b) limit. An employee who is age 50 or over can use the Age 50 Catch-up along with the 15-Year Rule.

What is the Age 50 Catch-up?

Employees who are age 50 or over in 2018 can add $6,000 to the 403(b) contribution limit of $18,000.

How do contributions to other retirement plans affect my Maximum Exclusion Allowance?

If you participate in other tax-deferred retirement plans, your combined elective deferral generally cannot exceed $18,000, which is the 415 limit for 2016. In addition, if you participate in other tax-deferred defined contribution retirement plans, the combined deferral generally cannot exceed your IRC 402(g) limit. Please consult your tax advisor for further information if you are participating in other tax-deferred retirement plans.