Need to Save for Retirement or
Want to Contribute More?
Did you know that you can adjust your contributions to your 403(b) or 457 (b) retirement plan anytime during the calendar year even if you made a change during Open Enrollment last November?
If you are currently participating in the University of Maine System’s 403(b) or 457(b) plan with TIAA, you may be able to save even more for retirement by increasing your pre-tax contributions.
Here is why...
As you know, the University of Maine System offers employees the opportunity to save for retirement and supplement basic pension benefits by making contributions on a pre-tax basis. This opportunity allows for saving on Federal and State taxes.
Contributions may be made up to the maximum permitted by the Internal Revenue Code [Section 403(b) and 415] with TIAA. See below for further information. To find out who is eligible, how to enroll or make changes to your plan, go to the UMS employee portal www.myyms.maine.edu, and visit under Human Resources/Employee Information/Benefits headings.
How much can I contribute?
In general, you may elect to contribute up to $18,000 in calendar year 2017. This amount is the general limit on what you can elect to defer under the 403(b) plan and may be adjusted annually in accordance with Internal Revenue Service (IRS) guidelines.
However, please keep in mind...
Additional catch-up contributions may be permitted if certain criteria are met. Specifically, if you are at least age 50 (or will turn age 50 during the calendar year), you may defer an additional $6,000 contribution, which is referred to as a catch-up contribution.
This means that if you are under age 50, you may contribute a maximum of $18,000 in calendar 2017; if you are age 50 or older or will turn age 50 sometime during calendar year 2017, you may contribute a maximum of $24,000 ($18,000 plus $6,000 age 50 catch-up during the calendar year).
What do I have to do to contribute or adjust my contributions to the 403(b) plan?
To begin pre-tax contributions or to change your current pre-tax contributions, please complete your elections online in MaineStreet. If you do not have access to a computer, contact the Employee Benefits Center (EBC) at (866) 269-9635 and complete a Salary Reduction Agreement.
Please keep in mind that you must establish an account directly with TIAA, the sole record keeper. You may change your 403(b) contributions at any time during the calendar year and as often as you like. You may, of course, keep your contributions at their current level.
457(b) Limits are exactly the same
All UMS employees who are eligible to tax-defer income under the 403(b) plan are also eligible to defer under the University’s 457(b) plan. While the 457(b) plan operates similarly to any other tax-deferred voluntary option relative to deferral of federal and state taxes, IRS regulations currently permit you to defer the calendar year maximum under each plan.
The 457(b) calendar maximums are the same as the 403(b) limits above. Therefore, if you are under age 50, you could defer a total of $18,000 in the 403(b) plan and $18,000 in the 457(b) plan; if you are age 50 or older or will turn age 50 sometime during the calendar year, you could defer a total of $24,000 in the 403(b) plan and $24,000 in the 457(b) plan.
To begin or change contributions under the 457(b) plan, please adjust your elections on line in MaineStreet. If you do not have access to a computer, contact your Employee Benefits Center at firstname.lastname@example.org or (866) 269-9635 and complete a Salary Reduction Agreement.
Did you know you don’t have to be a financial expert to be smart about money?
April is National Financial Literacy Month! Knowing how to manage your money can help you pursue financial goals like paying down debt, saving for retirement, buying a house or other priorities. To make the most of your money, create a plan that helps you save and invest wisely and get the most from your employer benefits. Learn more.
The University of Maine System does not provide legal, tax, or financial advice. Employees are encouraged to contact their financial representative or tax professional