Howard University Savings Plan

The Howard University Retirement Savings Plan is available to all eligible employees and provides access to a 403(b) Traditional retirement and Roth savings plan and a 457(b) deferred compensation plan (minimum $150,000 annual salary). Eligible employees receive an employer basic contribution upon the date of hire and are 100% vested immediately.  In addition, Howard University also offers an employer matching contribution upon the commencement of voluntary employee deferral contributions. 

To help build an investment portfolio that is right for you, the Savings Plan lets you invest your retirement savings among different investment funds including variable annuities, mutual funds, and traditional annuities.  You will receive information describing the investment funds available to you in your enrollment kit. Each of these investment funds has different investment objectives. The responsibility for choosing among the funds is yours. You should match your own needs to the opportunities offered by each investment fund.

Contribution Age Milestone

Age 20s 5%-10% Contribution Investing now can set you on a path toward reaching your financial goals and have tax benefits. By 30, you should have the equivalent of one year’s salary saved.
Age 30s 10%-15% Contribution Now is a good time to increase your contribution and work on cutting your debt, like student loans. By 35, you should have 2x your salary saved.
Age 40s 15% Contribution Your career is more established and as you increase your income you should increase your retirement allocation.
Age 50s 20% or Maximum annual limit along with the up to $6,000 per year catch-up contribution.** At this point, you want to have 4x your salary saved. If not, don’t worry…just keep saving and consider downsizing and looking at ways to cut expenses.

Plan Information

Eligibility

Vesting means the right to retain the University (Basic and Matching) contributions to your Plan account, and any investment earnings on these contributions. You are always 100% vested in the value of the University’s contributions as well as your own contributions to your account.

As an employee of the University, you are eligible to join the Savings Plan and to make salary deferral contributions to the Plan as soon as administratively practicable following your date of hire.  If you choose to make contributions to the Plan, you must agree to contribute at a rate more than $200 per calendar year.

  •   All non-benefit eligible employees may contribute employee contributions to the 403(b) Plan.
  •   Non-benefit eligible employees are not eligible to receive employer matching contributions.

Enrollment Information

If you are eligible to participate in the Plan, you will be given information about the enrollment process at your new employee orientation meeting.  You can enroll in the Plan by visiting RetirementManager’s website at: www.myretirementmanager.com.  Once you provide your employer’s name (Howard University), you will be prompted to enter your social security number, last name and date of birth to set up your account.

Vendor Information/Contacts

You must contact the investment companies directly:

  •   TIAA-CREF: Call 1-800-842-2776 or visit www.tiaa-cref.org
    • If you were a Plan participant prior to October 29, 2019, you could have also selected VALIC or Voya as your investment Company.  If that was the case, and you still have an funds that remained with VALIC and Voya during the transition to TIAA as a single record keeper, you can contact them directly to make any changes to your investments at any time:
  • VALIC: Call 1-800-448-2542 or visit  www.valic.com
  • VOYA: Call 1-800-584-6001 or visit  www.voya.com
    • If you were a Plan participant prior to July 1, 2011, you could have also selected Lincoln Financial Group (“LINCOLN”) as your investment Company.  If that was the case, and you still have an account with LINCOLN, you can contact LINCOLN directly to make any changes to your investments at any time:
  • LINCOLN: Call 1-800-454-6265 or visit www.lfg.com

Beneficiary Designation

As part of your enrollment process, you will be asked to designate a beneficiary who will receive your benefits under the Plan upon your death. If you are married, your spouse will automatically be named as your beneficiary unless your spouse consents, in writing witnessed by a Plan representative or notary public, to your designation of another beneficiary. 

Upon your death, your benefits under the Plan will be distributed in accordance with your most recently filed beneficiary designation form, as long as any required spousal consent to such designation has been provided.  If you do not have a valid beneficiary designation on file, upon your death, you will be deemed to have designated a beneficiary or beneficiaries in the following order of precedence: (1) your spouse; (2) your surviving children in equal shares; and (3) your estate.  You can change your beneficiary designation at any time, with your spouse’s consent if applicable, as described above.

Remember to review your beneficiary designation regularly and make any changes necessary especially after you get married or divorced or have another major life event.

    University Basic Contributions

    If you are an eligible employee, the University will automatically contribute 6% of your regular-base compensation to your account, each pay period, commencing with your date of hire (“Basic University Contributions”).  You do not have to contribute to the Plan to receive the Basic University Contribution.

    University Matching Contributions

    As an eligible employee, when you make contributions to the Plan, you will receive matching contributions from the University equal to 50% of your before-tax contributions or Roth after-tax contribution, up to 4% of your eligible compensation (the “University Matching Contributions”).  Therefore, if you contribute 4% of your eligible compensation, you will receive a 2% match from the University.  The University Matching Contributions are made on a payroll basis, and you have to be an eligible employee at the time of your elective contribution to be eligible for the University match.

    Before Tax Contributions

    When you contribute to the Savings Plan on a before-tax basis, contributions are deducted from your paycheck before federal and (depending on where you live) state and local income taxes are subtracted. You lower your taxable income, which means that you pay less in current income taxes. You don’t pay taxes on your before-tax contributions or any investment earnings on those contributions until you receive a distribution from the Savings Plan. However, you are still required to pay Social Security taxes on any before-tax contributions you make to the Savings Plan.

    Roth After Tax Contribution

    The key difference between before-tax contributions and Roth after-tax contributions is the timing of taxation. Roth after-tax contributions are made after your Social Security taxes, and any federal, state, and local income taxes are calculated and withheld. If your Roth after-tax contributions are distributed as a “qualified distribution,” the accumulated earnings will not be taxable. To be a “qualified distribution", the distribution must be made after you (1) either attain age 59½, become disabled, or die; and (2) complete five (5) years of participation in the Roth after-tax contribution account. The five (5)-year period required for a “qualified distribution” is the period of five (5) consecutive calendar years that begins with the first calendar year in which you make a Roth after-tax contribution. This period continues to run even if you do not make any further Roth after-tax contributions.

    Roth After Tax Contributions

    The key difference between before-tax contributions and Roth after-tax contributions is the timing of taxation.  Roth after-tax contributions are made after your Social Security taxes, and any federal, state and local income taxes are calculated and withheld.  If your Roth after-tax contributions are distributed as a “qualified distribution,” the accumulated earnings will not be taxable.  To be a “qualified distribution,” the distribution must be made after you (1) either attain age 59½, become disabled or die; and (2) complete five (5) years of participation in the Roth after-tax contribution account.  The five (5)-year period required for a “qualified distribution” is the period of five (5) consecutive calendar years that begins with the first calendar year in which you make a Roth after-tax contribution.  This period continues to run even if you do not make any further Roth after-tax contributions.

    Loans

    You can borrow money using your Plan account as collateral for any reason, and pay the account back with interest by check or electronic transfer. Initiating a loan is permitted only while you are actively employed by the University. As part of the application and approval process, you will receive a loan disclosure statement showing any loan initiation fees, the interest rate, and repayment information that will be applicable to your loan. There are two (2) types of loans available: general purpose loans and principal residence loans. You will be required to submit purchase documentation in the case of a principal residence loan. You cannot have more than two (2) general purpose loans and one principal residence loan outstanding at any point in time.

    Hardships/Withdrawals

    While you are employed, you may apply for certain withdrawals or loans. If your employment ends, you will be entitled to receive a distribution of your account balance, and you will need to make some decisions about what to do with that distribution if you want to continue deferring taxes.

    Contact your investment company(ies) directly to request an in-service withdrawal or loan from your account.

    There are three (3) types of withdrawals that you can make from the Savings Plan while you are employed by the University:

    • Hardship withdrawals from your Supplemental Employee Contributions account;
    • Age 59½ withdrawals from your account; and
    • Qualified military reservist distributions.

    You have up to five (5) years to repay a general purpose loan, and up to ten (10) years for a primary residence loan.  Your first payment is due the first day of the third month after your loan is issued.

    Savings Plan Document