Understanding the three-year vesting requirement
When you are hired and enrolled in the IU Retirement Plan, you are subject to a three year “vesting cliff.”
This means that retirement contributions made by Indiana University become 100 percent yours after you have been employed and enrolled in the IU Retirement for three years.*
If your employment ends prior to that time, those contributions are forfeited.
There are exceptions. You will be fully vested if one of the following occurs before the three-year cliff:
- Death
- Disability (as defined by social security)
- You turn 65
* The three year cliff vesting requirement applies to plan participants enrolled after September 1, 2010.
Forfeited contributions
Forfeited contributions are removed from individual plan accounts, but remain assets to be used by IU to offset future contributions for other participants.
If you terminate your employment before your IU Retirement Plan contributions and earnings are fully vested, but you return to IU employment within six months, the forfeited account balance on your date of termination will be reinstated as soon as administratively possible.