Self-Managed Plan (SMP) 401(a) Defined Contribution Plan Serving Employees of Illinois Community Colleges and Universities

Self-Managed PlanSelf-Managed Plan(SMP)(SMP)

401(a) Defined Contribution Plan

Serving Employees of Illinois Community Colleges and Universities

ContributionsContributions

8.0% Employee

7.1% State (total 7.6% with .50 for disability contribution)

15.1% total invested*

*Subject to current IRS code 415(c) limits


ContributionsContributions

• State contributions will begin with… “The first full payroll following receipt

of the SMP election form”

• Account Balance transferred to fund choice(s) within 21 days from receipt of election form

• Normal contributions are transferred 3-5 days after receipt from employer


Allocation of ContributionsAllocation of Contributions


““Fund Overview”, from Fund Overview”, from www.surs.orgwww.surs.org


What should you do?What should you do?

REVIEW!

REBALANCE!

DIVERSITY!


Investment Fund TransfersInvestment Fund Transfers


When can you retire?When can you retire?

• Age 55 with 8 yrs of service credit

• Age 62 with 5 yrs of service credit

• Any age with 30 years of service credit

• Police/Fire age 50 with 25 yrs, age 55 with 20 yrs.


Accumulating Service CreditAccumulating Service Credit

Service Credit Earned:

• 15 or more calendar days=1 month

• 1-2 months= .25 year



• 8 months+ =1.00 year


Unused/Unpaid Sick LeaveUnused/Unpaid Sick Leave

Converted to extra service, will be used for:

• Vesting

• Eligibility to retire (5 or 8 yrs.)

Annuity Begin Date must be within 60 days of termination to include service

credit converted from Sick Leave!


Unused/Unpaid Sick LeaveUnused/Unpaid Sick Leave

Unused/unpaid sick leave reported by employer upon termination of employment

Full Work Days = Additional Service Credit

• 20-59 days .25 year

• 60-119 days .50 year

• 120-179 days .75 year

• 180 days or more 1.00 full year


Purchasing Service CreditPurchasing Service Credit

Will NOT be matched by the State!

“Active” employee:• Prior Service• Other Public Employment-does NOT

count toward vesting or retirement eligibility• Military- does NOT count toward vesting,

does count toward retirement eligibility• Deferred Leave of Absence (w/o pay)



“Active” or “Terminated” employee:• Repayment of Refund-need 2 years service

following date of refund to repay

How do I purchase Service Credit?• Rollover of Qualified $

• After Tax $

• Installment purchase, if active



Why purchase service credit?• Vesting-to attain minimum service

requirement

• Increase-annuity benefit with purchase cost

• Tax deferral-if installment purchase, reduce current taxes and defer until distribution

• Insurance-if University employed, may reduce premium cost

Please call SURS for details!Serving Employees of Illinois Community Colleges and Universities

Reciprocal ActReciprocal Act

• Must have participated in at least 1 of the

other 12 Reciprocal Systems in Illinois and earned at least 1 year of credit

• Must meet each system’s minimum service credit requirement

• Earnings from all systems will be considered for your final average earnings


Options at TerminationOptions at Termination

• Leave money with SURS

• Rollover to another Qualified Plan

• Lump sum refund-(20% withheld for taxes + 10% penalty if not 59 1/2)

<5 yrs…state match forfeited

>5 yrs…entitled to the entire acct. val.


RetirementRetirement

Same choice with each Provider:

• Rollover to another Qualified plan

• Lump sum (20% withheld for taxes)

• Lifetime Monthly Annuity*o Single Life or

with 10, 15 or 20 year guaranteeo Joint and Survivor (J&S) 50% or 100% or

with 10, 15, or 20 year guarantee

*necessary to be eligible for insurance


What’s Needed to Retire?What’s Needed to Retire?

SURS must have:

• Termination report from employer

• All contributions (last payroll)

• State matching $

• Verification of birth and marriage

• Retirement application


Retirement ApplicationRetirement Application

Obtain Application:

• www.surs.org, “Self-Managed”, “Forms & Guides” or…

• Call SURS

Submit within 90-days from the Annuity Begin Date


On-line Forms-www.surs.orgOn-line Forms-www.surs.org


Returning to Work after Returning to Work after RetirementRetirement

Self Managed Plan has no time limit or earnings limitation for returning

to work!

No longer eligible to make contributions to SURS


DeathDeath

“Active” employee benefit recipients:• Spouse-w/o Survivor Waiver

Lifetime annuity, lump sum or rollover

• Beneficiary-lump sum

• Estate-lump sum

With 1.5 years, benefit includes state match


DeathDeath

“Terminated” employee benefit recipients:• Spouse-w/o Survivor Waiver

Lifetime annuity, lump sum or rollover

• Beneficiary-lump sum

• Estate-lump sum

With 5 years, Benefit includes state match


DeathDeath

“Retired” employee:

Benefits to your designated beneficiaries will be determined by the annuity contract purchased at the time of your retirement.


Contact SURS to:Contact SURS to:

• Change address & other personal info

• Change beneficiary

• Reallocate contributions

• Choose Provider(s)

• Coordinate withdrawals

• Inquire about SURS Unified Statement


Contact Provider(s) to:Contact Provider(s) to:

• Seek investment education

• Determine appropriate asset mix

• Allocate investment Funds

• Inquire about quarterly statements

• Obtain estimate of benefits


Fund Info. & Estimates:Fund Info. & Estimates:

TIAA-CREF….1-888-219-8310

www.tiaa-cref.org/illinois

Fidelity……….1-800-343-0860

www.fidelity.com/atwork

*Principal…1-877-210-5565x202

[email protected]

*annuity payout onlyServing Employees of Illinois Community Colleges and Universities

Processes, Forms, Processes, Forms, Plan Info. or Detailed Plan Info. or Detailed

Questions:Questions:SURS:

Phone: 1-800-275-7877

(local-378-8800)

FAX: 1-217-378-9800

www.surs.org


DisclaimerDisclaimerAll aspects of administration of the State Universities Retirement System (SURS), including but not limited to benefit calculation and payment, must comply with state and federal law. No employee of SURS has the authority to bind the system to take action contrary to law, even in the event of misstatement of fact or law. Furthermore, while this letter states SURS’s current understanding of the law, this could change as a result of court opinions, statutory changes, or other matters (e.g., Attorney General opinions). Accordingly, SURS is required under law to correct any mistake in benefit amount, even after payments have begun. Use of any information from this letter, form, or any other document provided by SURS is for general information only and does not represent personal tax or legal advice either express or implied. You must seek professional legal or tax advice for personal income tax questions and other legal assistance.


Documents

Self-Managed Plan (SMP) 401(a) Defined Contribution Plan Serving Employees of Illinois Community Colleges and Universities