Policy A-12

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RETIREMENT PROGRAMS

Retirement Age

(Approved: Trustees 5/18/59; 4/5/86; Administrative Practice)

As of 1/1/94 federal law prohibits the setting of a mandatory age at which employees must retire from the University. Retirement benefits are determined by the retirement plan for which the appointee is eligible. For faculty, the IU Retirement Plan does not reference age, except for 18/20.

INDIANA UNIVERSITY RETIREMENT PLANS

(Administrative Practice)

The Trustees of Indiana University approved the original Retirement Plan on May 18, 1937; the Revised Plan incorporating a TIAA deferred annuity contract on June 30, 1947; and major revisions on May 18, 1959; April 5, 1986; October 14, 1988; and October 30, 1998. Other changes have been made periodically and now include investment funds at TIAA-CREF and Fidelity.

Descriptions of the five IU Retirement Plans (Plan 15, Plan 12, Plan 11.25, Plan 10, and PERF) follow. Details on the available investment venues may be obtained from the University Benefits Office (855-1286) or (http://www.indiana.edu/~uhrs/benefits/index.html).

Participants are immediately vested in IU contributions and any investment earnings.

IU Retirement Plan 15

Eligibility. Full-time employees with a commencement date of 12/31/88 or earlier were eligible as follows: Professors, associate professors, assistant professors, librarians, associate librarians, assistant librarians, senior scientists/scholars, associate scientists/ scholars, assistant scientists/scholars, and full-time clinical appointees are eligible immediately upon appointment. Persons in administrative and professional positions ranked at level 16 or above and University physicians are eligible immediately upon appointment for a term of one or more years. (Board of Trustees, June 30, 1947; November 17,1950; April 20 1951; April 25, 1970; June 30, 1972; April 5, 1980; February 7, 1981; October 14, 1988)

University Contribution. IU Contribution to individual participant-directed accounts equal to 11% of the first $7,800 of Base salary (not including salary for summer appointments or supplemental pay) plus 15% of the remainder, not to exceed IRS limits. (Board of Trustees, July 1, 1960; October 14, 1988)

Retirement. Participants are eligible for the 18-20 Early Retirement Plan as revised on 10/14/88. (Board of Trustees, May 18, 1937; April 5, 1986; October 14, 1988)

Long-Term Disability. Participants are eligible for the University-funded Long-Term Disability Income Continuation Plan. (Board of Trustees, June 17, 1977)

IU Retirement Plan 12

Eligibility. Full-time employees with a commencement date of 1/1/89 to 6/30/99 are eligible as follows: Professors, associate professors, assistant professors, librarians, associate librarians, assistant librarians, senior scientists/scholars, associate scientists/ scholars, assistant scientists/scholars, and full-time clinical appointees are eligible immediately upon appointment. Affiliate librarians are also eligible immediately upon appointment provided they are appointed with tenure or for a term of one or more years. Persons in administrative and professional positions ranked at level 16 or above, as well as University physicians, are eligible immediately upon appointment for a term of one or more years. Visiting faculty and visiting professional librarians are excluded from eligibility for Retirement Plan 12. (Board of Trustees, June 30, 1947; November 17, 1950; April 20, 1951; April 25, 1970; June 30, 1972; April 5, 1980; February 7, 1981; April 4, 1981; October 14, 1988; Administrative Practice)

University Contribution. IU Contribution to individual participant-directed accounts equal to 12% of Base Salary (not including salary for summer appointments or supplemental pay), not to exceed IRS limits. (Board of Trustees, July 1, 1960; October 14, 1988;Administrative Practice)

Retirement. Participants are eligible for the Supplemental Early Retirement Plan (IUSERP). Participants are not eligible for the 18-20 Early Retirement Plan. (Board of Trustees, May 18, 1937; April 5, 1986; October 14, 1988; May 3, 1996)

Long-Term Disability. Participants are eligible for the University-funded Long-Term Disability Income Continuation Plan. (Board of Trustees, June 17, 1977)

IU Retirement Plan 11.25

Eligibility. All academic and staff employees who are permanent residents of the United States with a commencement date of July 1, 1989; to June 30, 1999; who (1) are not eligible to participate in Retirement Plan 12 or Retirement Plan 15, and (2) are appointed to positions of at least 50% FTE on a 12-pay schedule, or 60% FTE on a 10-pay schedule are eligible immediately upon appointment; and all academic and staff employees with a commencement date prior to July 1, 1989; who were enrolled in PERF prior to that date and who do not choose to remain in the PERF Retirement Plan. (See below.) (Administrative Practice)

University Contribution. IU contribution to individual participant-directed accounts equal to 11.25% of total Annual Salary, not to exceed IRS limits. (Administrative Practice)

Retirement. Participants are not eligible for early retirement plans. (Board of Trustees, October 14, 1988)

Long-Term Disability. Participants are eligible to apply for the employee-funded voluntary Long-Term Disability Plan. (Administrative Practice)

IU Retirement Plan 10

Eligibility. IU employees with an Academic or Professional Staff Appointment of 50% or more, effective July 1999; or later.

Plan Type. Defined contribution plan in accordance with IRC Section 403(b)

University Contribution. IU contribution to individual participant-directed accounts equal to 10% of Base Salary (not including salary for summer appointments or supplemental pay), not to exceed IRS limits.

Investment Options. Investment fund options approved by Indiana University at TIAACREF and Fidelity Investments.

Long-Term Disability. Participants are not eligible for the University-funded Income Continuation Plan but may apply for the employee-funded voluntary Long-Term Disability Plan. (Board of Trustees, October 30, 1998; Administrative Practice)

PERF Plan

Eligibility. The Public Employees’ Retirement Fund (PERF) is a mandatory State Retirement Plan for employees who are citizens or permanent residents of the United States who are not eligible for any of the other IU Retirement Plans or who enrolled in PERF prior to July 1, 1989; and are eligible to, but do not choose to transfer to IU Retirement Plan 11.25. It consists of two separate benefit provisions: a pension benefit and an annuity savings account benefit. (State Regulations; Administrative Practice)

Pension. The pension benefit is an annual benefit payable for life. Participants must have at least 10 years of PERF service to have a vested right to this pension benefit. The annual retirement benefit is defined as 1.1% of the average annual earnings for the five highest years multiplied by years of creditable service. In addition, a portion of the value of the participant’s annuity account, based on the value of the account at retirement and the cost of purchasing a lifetime income given retirement age, is added to the employer pension benefit. Participants with 15 or more years of service are eligible for early retirement between the ages of 50 and 65 at reduced benefits. (State Regulations)

Annuity. The plan is a combination of defined contribution of the employee (3% of earnings, paid by the University) for the generation of a retirement annuity plus a retirement benefit provided by the State, with the University making a contribution to the State Fund of 8.5% of earnings. Employees are immediately 100 percent vested in contributions and account earnings, which are tax deferred until withdrawn.

Long-Term Disability. With five or more years of service, participants who qualify for disability benefits from the Federal Social Security Administration are eligible to receive a monthly disability from PERF based on years of service, average salary, and the amount in the annuity account. Participants are eligible to apply for the employee-funded Voluntary Long-Term Disability Plan. (State Regulations; Administrative Practice)

RESOLUTION ALLOWING PHASED RETIREMENT PROGRAM PARTICIPANTS TO MAKE WITHDRAWALS WHILE EMPLOYED

WHEREAS, Indiana University has identified recruitment and retention of excellent faculty as a strategic priority;

WHEREAS, Indiana University has adopted a Phased Retirement Program for tenured faculty allowing participants who are at least age 65 and have at least 10 years of service as a tenured faculty member to commit to a retirement date and phase into retirement over a 12 to 36 month period during which they are on a 20 to 50 percent unpaid leave of absence; AND WHEREAS, Indiana University’s Phased Retirement Program allows participants to make withdrawals from the IU Retirement Plan while in the Phased Retirement Program in order to supplement their income;

NOW, THEREFORE BE IT RESOLVED that The Board of Trustees approves the adoption of a provision in the IU Retirement Plan that provides for distribution rights for participants in the Phased Retirement Program, effective January 1, 2009.

Unanimously approved on a motion duly made and seconded.

(Approved: Trustees 12/12/08)

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