403(b) Retirement Savings Plan

• Eligibility & General Information

  Eligibility  

  An eligible employee classification includes employees who normally work 20+ hours per week OR have an appointment of at least 50% OR union employees whose bargaining contract permits participation.

  Student Assistants, Technicians, Graduate Assistants and Temporary employees are NOT eligible to participate.

  Employee Contributions

  You may enroll and start your contributions any time after your date of hire in an eligible employee classification. 

  Maximum

  For calendar year 2024, the amount contributed is limited to $23,000/$30,500 (under age 50/over 50). This maximum includes any employee contributions made to 403(b) plans sponsored by other employers. These limits are indexed each year by the Internal Revenue Service. Contributions to this plan are in addition to (separate from) contributions to the 457(b) plan, so you can contribute $23,000/$30,500 (under age 50/over 50) to both the 403(b) and the 457(b) plan.

  Wayne State University limits the percentage amount you can contribute for any one paycheck to 80% of gross pay (considering both 403(b) and 457(b) plan contributions). This is necessary to ensure that you have compensation remaining to cover other employee benefits costs.

  Contributions must be made in WHOLE percentage increments to each of the investment carriers (no decimals).

  University Contributions

  Maximum

  For calendar year 2024, if you are making employee contributions, the maximum university matching contributions (up to a maximum salary of $345,000) is $34,500.  Matching is made on a 2-for-1 basis (up to 10%) of your eligible gross salary (see table below). Internal Revenue Code Section 401(a)(17) prohibits employers from making retirement plan contributions on the amount of annual salary in excess of $345,000. If you are in this category, you may see your 403(b) university contributions reduced and/or stopped within a calendar year. This limit may be indexed for inflation in $5,000 increments in future years.

  Please Note: If you elect to contribute the IRS employee contribution maximum prior to the end of the calendar year your employer match will continue to process on a bi-weekly basis, provided you remain on payroll, until the end of the calendar year.

  Employee Contribution	University Matching Contribution
  1%	2%
  2%	4%
  3%	6%
  4%	8%
  5% or more	10% (maximum)

  Eligibility

  The university contributions begin after you are age 26 and agree to make employee contributions of at least 1%.

  There is NO waiting period for university contributions (except age 26) and the plan provides matching contributions on a 2-for-1 basis, up to a maximum of 10% of your gross salary.  

  Contribution Vesting

  "Vesting" in a retirement plan means ownership. Employee contributions are fully vested at all times. This means the amounts cannot be forfeited, even if you terminate your employment with WSU.

  University contributions will be vested after 2 years of service. Your accumulated university contributions and related earnings revert back to the university if you terminate from WSU before you have 2 years of service.

  Bypassing the required 2 years of service

  You are able to bypass all or some of the 2 years of service requirement by submitting a Predecessor Employer Service Letter from a previous employer that meets certain requirements (below). Your Predecessor Employer Service Letter must be submitted within 90 days of your WSU hire date for consideration. 

  WSU will consider service from a previous employer, provided the following conditions are met:

  • The previous employer is:
    • an institution of higher learning (e.g. college or university), or
    • a non-profit educational institution (e.g. K-12 school district), or
    • a tax-exempt organization which is affiliated with higher education (e.g. a non-profit teaching hospital)
  • You worked 50% or more time
  • The time to be waived is within 3 years prior to your WSU hire date; any service during the 3-year look back period will be counted by WSU (For example, if your WSU hire date is 7-1-2019, your 3-year look back period could include any service (up to 24 months) that falls within 7-1-2016 through 7-1-2019).
  • Your Predecessor Employer Service Letter is submitted within 90 days of your WSU hire date

  The Predecessor Employer Service Letter from your previous employer must include:

  • On letterhead and signed by a representative of the employer
  • A description of the institution
  • Your job title (cannot be Graduate Assistant or student assistant)
  • Your dates of employment (beginning and end dates), and
  • Your percentage of time worked (must be at least 50%)

  Please Note: WSU will not waive the age 26 requirement to begin university contributions.  

  Please Note: WSU will not count any prior service where you were employed as a "graduate student", "graduate assistant", "part-time faculty", "student assistant", "temporary employee" or "volunteer faculty".  

  All Predecessor Employer Service Letters must be submitted to the HR Service Center within 90 days of your Wayne State University hire date for consideration.

• Investment Options

  You may select one or both of the following 2 investment carriers:

  TIAA

  Offers over 30 different investment options including mutual funds from Vanguard, American Funds, DF and others.

  The Base Plan (Defined Contribution Plan) Plan Number: 103167
  This plan provides matching university contributions equal to $2 for every $1 for the first 5% of employee contributions.

  If you elect the Traditional Account (guarantee fund), you may NOT withdraw or transfer your balance in a single lump sum -- Distributions or transfers must be spread over 10 annual installments (RA issued prior to 8/8/10) or 5 annual installments (GRA issued on or after 8/1/10).

  The exception is that if you request a withdrawal or transfer within 120 days after your termination of employment – you MAY take a lump sum, but you will pay a 2.5% surrender charge.

  Fidelity Investments

  Offers 150+ mutual funds, including money market, stock and bond funds.

  Base Plan Plan Number: 52864
  This plan provides matching university contributions equal to $2 for every $1 for the first 5% of employee contributions.

  There are no liquidity constraints.

  What if I am uncertain about how to invest?

  You may want to consider the "target date funds" that are designed to provide a single diversified portfolio, managed based on the target date when you will turn age 65 – called Lifecycle funds at TIAA and Freedom funds at Fidelity.

  • The fund is managed for you, so this option is an alternative to building your own portfolio of assets.
  • The fund automatically resets the asset mix (stocks, bonds, cash equivalents) in its portfolio that is age appropriate (i.e., becomes more conservative as you get closer to the end date of age 65).
• Accessing Savings

  Plan Loan Information

  You may borrow from the Plan by contacting the Investment Carrier (TIAA and/or Fidelity Investments) where your account balance resides, subject to the following rules:

  • The maximum loan amount is the lesser of: (a) 50% (45% at TIAA) of the vested account value in the Plan minus current outstanding loan balances in the Plan or (b)  $50,000 (reduced by the higher of the outstanding balance on all loans or the highest outstanding balance on all loans during a one-year look back period).
  • The maximum loan repayment period is 5 years, unless the loan is used to buy your primary residence (10 year limit).
  • The loan repayments must be repaid directly to the Investment Carrier.
  • Fidelity Investments charges fees for loans ($35 set-up plus $3.75 per quarter processing fee). The interest rate is the prime rate per Reuters, as adjusted at the 1^st of each quarter, and remains fixed over the term of your loan. Repayment is monthly.
  • TIAA charges no fees for loans. The interest rate is based on Moody's corporate bond rate, as adjusted at the first of each calendar quarter. For the first 6 months of your loan, the rate is fixed and after that the loan rate on your loan adjusts. Repayment is monthly or quarterly.
  • An employee may have no more than three (3) loans outstanding at any time. An employee who has one or more defaulted loans may not take another loan until all defaulted loans have been repaid.
  • When you receive the Plan loan proceeds, the Federal Tax Withholding (20%) and Early Withdrawal Penalty (10%) will not apply.
  • If you fail to make repayments, as required by the terms of the loan, your loan will be "defaulted" which will result in taxable income to you and an Early Withdrawal Penalty of 10%  if you are under age 59-1/2.

  Loan Highlights
  Minimum	$1000
  Maximum	45-50% of your vested account balance
  Interest Rate	Reset each quarter for new loans
  Repayment	At least monthly
  Default	If you fail to make repayments, as required by the terms of the loan, your loan will be "defaulted" which will result in taxable income to you and an Early Withdrawal Penalty of 10% (if you are under age 59-1/2)

  Hardship Withdrawal Information

  You may take a Hardship Withdrawal by contacting the Investment Carrier (TIAA and/or Fidelity Investments) where your account balance resides, subject to the following rules:

  • You may withdraw from the Plan for an "immediate and heavy financial need" for which you lack other available resources. This distribution is different from a loan because when you make a hardship cash withdrawal, you do not need to pay it back to the Plan.
  • The approved expenditures that meet the Plan criteria are:
    • Unreimbursed Medical Expenses  for the employee, spouse or the employee's dependents
    • Purchase of your principal residence
    • Prevent home eviction or foreclosure
    • Post-secondary education expenses for the next semester or quarter post-secondary education for the employee, spouse or dependents (expenses for books or room and board do not qualify)
    • Repair casualty loss damage to principal residence
    • Payment for funeral or burial expenses
  • Only employee contributions may be withdrawn due to hardship (not university contributions or any accumulated investment earnings).
  • You must utilize all available Plan loans before you can apply for a Hardship Withdrawal.
  • You are prohibited from making employee contributions under the Plan for a 6-month period, beginning on the date you receive the Hardship Withdrawal.
  • The Federal Tax Withholding (20%) does not apply, but the Early Withdrawal Penalty (10%) does apply when you take a Hardship Withdrawal.

  Hardship Highlights
  What funds	Only employee contributions (without investment earnings)
  Loans first	You must utilize all available Plan loans before you can apply for a Hardship Withdrawal
  Stop Employee Contributions	WSU will stop all employee contributions under the Plan for a 6-month period.

  Cash Withdrawal Information

  You may withdraw your funds from the Plan by contacting the Investment Carrier (TIAA and/or Fidelity Investments) where your account balance resides, subject to the following rules:

  • Your employee contributions and university contributions are made on a pre-tax basis. Thus, Federal and state income taxes are deferred until you withdraw your vested account balance as cash.
  • Any investment return on your contributions are tax-deferred, and also subject to tax upon cash withdrawal

  Events that permit Cash Withdrawals
  	Early Withdrawal Penalty before Age 59-1/2	20% Federal Tax Withholding
  Termination of employment at any age	Yes1	Yes
  Attainment of age 59-1/2	No	Yes
  Disability	No	No
  Plan loan	No	No
  Hardship Withdrawal	No	Yes

  • 20% Federal Tax Withholding - Generally cash withdrawals are subject to a 20% Federal income tax withholding.
  • Early Withdrawal Penalty -  A 10% IRS early withdrawal penalty will be assessed if you receive a cash withdrawal before you are age 59 ½, except for death, Disability, Loan or Hardship Withdrawal.
  • ¹If you separate from service before age 55 and elect Substantially Equal Periodic Payments (SEPP) and these payments  continue for 5 years or until you reach 59-1/2 ( whichever is later), you will not be subject to the Early Withdrawal Penalty.

  Leaving the university

  Once you terminate your employment from Wayne State University, you may elect any of the following distribution options:

  • Retain your WSU account - leave your vested account balance with your current Investment Carrier (inside the WSU 403(b) Retirement Plan) until some later date. Later you can take cash withdrawals or arrange to annuitize your vested balance.
  • Rollover to your next employer's plan - roll your vested account balance into another qualified plan of your new employer.
  • Rollover to an IRA -roll your vested account balance into an IRA
  • Cash withdrawal - elect a cash income option (subject to 20% Federal income tax withholding and 10% Early Withdrawal Penalty if you are age 59-1/2 or less).
  • Annuity option -  elect an annuity option from TIAA. When you "annuitize" your account balance, you may select regular cash payments in the form of a single life annuity, joint and survivor annuity, fixed period certain annuity. There is no requirement that you elect an annuity as an option if your funds are invested with TIAA, unless you have savings in the TIAA Traditional Account. 
• Investment Carrier Contact Information

  Investment Carrier Contact Information
  Telephone: 1-800-842-2252 Web: http://tiaa.org/wayne	Telephone: 1-800-343-0860 Web: http://netbenefits.com/waynestateuniversity
  Financial Consultations: Click to schedule an appointment on campus or virtually Call to schedule: 1-800-732-8353	Financial Consultations: Click to schedule an appointment on campus or virtually Call to schedule: 1-800-642-7131
  View TIAA webinars	View Fidelity Investments webinars