Automatic 403(b) Enrollment and Escalation Features Effective January 2024
Posted in Announcements
As announced in November 2023, in 2024 the university is taking additional steps to encourage employees to increase their retirement contributions. The changes below are now in effect and apply to all employees eligible for the Defined Contribution Retirement Plan (DCRP). While these changes occur automatically, they are completely voluntary.
You have the ability to opt out or adjust your retirement savings options in GMS at any time. If you would like to make changes prior to your first pay check in January and are paid on a biweekly schedule, updates must be entered in GMS by Sunday, January 7 2024. If you are paid on a monthly schedule, updates entered by Tuesday, January 23, 2024 will be reflected in your January pay.
Retirement Readiness Features
Starting on January 1, 2024, and each January 1 thereafter, all employees who are eligible for the DCRP who are currently contributing less than 3% of their eligible pay will be automatically enrolled at 3%. This change aims to encourage increased retirement savings and ensure all eligible employees receive the maximum matching contribution from the University.
- If you are in Phase One of the DCRP waiting period and are contributing less than 3% to the Voluntary Contribution Retirement Plan (VCRP), your contributions will be automatically increased to 3% in the VCRP.
- If you are enrolled in the DCRP and are contributing less than 3%, your contributions will be automatically increased to 3%, and you will receive the corresponding maximum contribution from the University.
- If you are enrolled in the DCRP and are already contributing 3%, there will be no change to your DCRP contributions.
For individuals enrolled in the DCRP and contributing 3%, there will be automatic contribution escalations to the Voluntary Contribution Retirement Plan (new window) (VCRP).
- Beginning on each January 1, this contribution percentage will increase by 1% annually, until you reach a maximum contribution of 12% in the VCRP.
- As of January 1, 2024, if your current contribution is a specific dollar amount, it will be converted into a percentage and increased to the nearest whole percentage.
- If you are already contributing the maximum employee contribution amount allowable by the IRS ($23,000 in 2024 with an additional catch up contribution of $7,500 for those 50+), there will be no change to your contribution.
This automatic escalation feature will not apply if you are in Phase One of the DCRP waiting period.