IU Retirement Plan

The IU Retirement Plan for Academic and Professional Staff Employees is a section 403(b) defined contribution retirement plan. All Plan contributions are made by Indiana University. Participants are not required, nor permitted, to make additional contributions to the plan.

The information on this page is only a summary. Review the IU Retirement Plan – Plan Document for a detailed description of the terms and conditions of the plan.

Plan Details

Eligibility

To be eligible to participate in the Plan at a stated contribution level, an employee must be a:

Level IU Contribution Eligibility
10% An amount equal to 10% of budgeted base salary1 for each regular pay period. 50% or more full-time equivalent (FTE) appointed Academic or Professional Staff employees hired in an eligible position after June 30, 1999.
11.25% An amount equal to 11.25% of total salary2 for each regular pay period. 100% FTE professional staff employee hired in an eligible position before July 1, 1999, grade 15 and below, and other appointed academic or professional staff employees hired in an eligible position before July 1, 1999 who are less than 100% FTE, but are at least:
  • 50% FTE for 12 pay status; or
  • 60% FTE for 10 pay status; or
  • 65% FTE for 9 pay status.
12% An amount equal to 12% of budgeted base salary1 for each regular pay period. 100% FTE appointed academic or professional staff employee, grade 16 and above hired in an eligible position between January 1, 1989 and June 30, 1999.
15% An amount equal to 11% of the first $7,800 of budgeted base salary1, plus 15% of budgeted base salary thereafter. 100% FTE appointed academic or professional staff employee, grade 16 and above hired in an eligible position before January 1, 1989.
1 Budgeted base salary does not include any supplemental pay received.
2 Total salary includes budgeted base salary and supplemental pay.

Enrollment

Eligible employees are automatically enrolled in the appropriate plan, but must setup their plan account, choose investments, and designate beneficiaries by following these step-by-step enrollment instructions. For assistance with any of these processes, contact Fidelity at 877-343-0860.

Contributions

Indiana University makes all contributions to the plan. Employees are not permitted to contribute to the plan. Employees who meet the below listed eligibility requirements are automatically enrolled in the plan at the appropriate level.

Level IU Contribution Eligibility
10% An amount equal to 10% of budgeted base salary1 for each regular pay period. 50% or more full-time equivalent (FTE) appointed Academic or Professional Staff employees hired in an eligible position after June 30, 1999.
11.25% An amount equal to 11.25% of total salary2 for each regular pay period. 100% FTE professional staff employee hired in an eligible position before July 1, 1999, grade 15 and below, and other appointed academic or professional staff employees hired in an eligible position before July 1, 1999 who are less than 100% FTE, but are at least:
  • 50% FTE for 12 pay status; or
  • 60% FTE for 10 pay status; or
  • 65% FTE for 9 pay status.
12% An amount equal to 12% of budgeted base salary1 for each regular pay period. 100% FTE appointed academic or professional staff employee, grade 16 and above hired in an eligible position between January 1, 1989 and June 30, 1999.
15% An amount equal to 11% of the first $7,800 of budgeted base salary1, plus 15% of budgeted base salary thereafter. 100% FTE appointed academic or professional staff employee, grade 16 and above hired in an eligible position before January 1, 1989.
1 Budgeted base salary does not include any supplemental pay received.
2 Total salary includes budgeted base salary and supplemental pay.

Contribution Limits

The information below is a summary of IRS contribution limits that apply to this plan. It is your responsibility to ensure you do not exceed these maximums between all of your retirement saving accounts. Visit the IRS Limits page for further details.

Total Contribution Limit – IRC 415(c)
For 2020, the calendar-year limit on total contributions is the lesser of 100 percent of your compensation or $57,000.

This total contribution limit applies to the sum of employer contributions to the IU Base Retirement Plan, the IRC 403(b) plan portion of the 18/20 Retirement Plan on behalf of a participant, and employee contributions to the Tax Deferred Account (TDA), except for the extra $6,500 that employees age 50 or older may contribute.

Note: The total contribution limit also applies to any contributions you make to 403(b) plan sponsored by employer in same controlled group as IU and, if you own 50% or more of an employer (such as a faculty practice plan), that employer's defined contribution 403(b), 401(a), 401(k) plan or SEP.

Annual Compensation Limit – IRC 401(a)(17)
The IRS limits the maximum annual compensation on which qualified retirement benefits can be calculated. For 2020, the maximum annual compensation is $285,000 of plan-eligible earnings.

Vesting

Participants enrolled in the plan on or after September 1, 2010 are subject to a three-year cliff-vesting requirement. This means that an employee is fully vested in the plan after three years of IU employment in a retirement-eligible position.

All account balances and future contributions and earnings of participants in the plan prior to September 1, 2010 are fully vested. 

For more information visit the IU Retirement Plan vesting information page.

Investment Options

This is a “participant directed plan” meaning you are responsible for directing the investment of your plan account. If you do not select investments, your funds will be invested in the plan’s default investment option – and age-appropriate Vanguard Institutional Target Retirement Date Fund.

Distributions & Withdrawals

Hardship distributions and loans are not allowed to be made to participants from this plan. For information on Required Minimum Distributions, see ‘Options When You Leave IU’ below.

Options When You Leave IU

When Your Employment Ends
All plan contributions stop when your employment with IU ends. Upon termination of employment, you may:

  • Leave accumulations in the plan account and continue to manage investments;
  • Withdraw all or a portion of vested plan account accumulations (subject to income taxes and/or penalty taxes); or
  • Roll over all or a portion of vested plan account accumulations to an eligible retirement plan (e.g., an IRA).

After terminating employment with the university, most transactions related to your plan account are handled directly with the applicable investment company. For more information, review the Benefits After Separation Guide.

Required Minimum Distributions at Age 70 ½ or 72
A federal law effective January 1, 2020 changed the age at which a person needs to begin taking required minimum distributions (RMD) from their retirement plan once retired or terminated.

  • The RMD is age 72 if you turn age 70½ on or after January 1, 2020.
  • The RMD remains age or 70½ if you reached age 70½ by December 31, 2019.

The IRS requires that you begin receiving distributions from your retirement accounts by April 1 of the calendar year following the calendar year you reach age 72 (or 70½) once retired or terminated. If you are already over age 72 (or 70½) when you retire or terminate, then you must take a distribution by April 1 of the following year.

Resources

Customer Service Contacts

IU Human Resources

Phone: 812-856-1234

Fidelity
www.netbenefits.com/indiana
Service: 800-343-0860
Appointment Scheduling: getguidance.fidelity.com or 800-642-7131
Speak to a Retirement Planner: 800-328-6608