Choosing a Retirement Plan

OSU offers eligible employees a valuable opportunity to build future financial security—a retirement benefit designed to meet the diverse and changing needs of our faculty and staff. Under the OSU Retirement Program, you can choose between two plan options: The Oklahoma Teachers’ Retirement System (OTRS) or the OSU Alternate Retirement Plan (ARP).

You Have a Choice

Each plan has its own features and benefits that may provide the right “fit” with your situation—your age, your career path, your financial goals, your tolerance for risk. These plan features are described and compared in the OSU Retirement Program Guide.

Please take time to read through the OSU Retirement Program Guide. You have 30 days from your hire date to submit your Election Agreement for OSU Retirement. As you review this information, it is important to understand you are making an irrevocable retirement plan election—meaning you will not have the opportunity to switch plans in the future.

Your Orientation and Benefits Enrollment Session provides an opportunity for a face-to-face forum to ask questions as the OSU Retirement Program is explained.

OTRS Plan Information, Effective July 1, 2018

OTRS Changes Effective July 1, 2018, Inside HR Article

New benefits-eligible employees have 30 days from date of hire to make a one-time, irrevocable election to participate in either the Oklahoma Teachers’ Retirement System (OTRS) Plan or the OSU Alternate Retirement Plan (ARP). Effective July 1, 2018, new hires who elect to participate in OTRS will pay the OTRS member contribution of 7% of compensation via pre-tax payroll deduction; OSU will continue to pay the 8.55% employer contribution.

Please note this change in OTRS member contributions will not affect employees who are currently participating in the OTRS plan. New employees who do not wish to make employee contributions can elect the ARP. The ARP is a defined contribution plan with employer contributions forwarded to TIAA.

The OSU Retirement Investments Committee, composed of faculty, staff, administrators and emeriti, meets quarterly to ensure employee benefit offerings are meeting OSU goals. OSU has received national recognition for its management of retirement plans with excellent funds, low fees, great services, higher than minimum recommended replacement ratios, and portability. OSU’s current offerings are at the top of those offered by comparative mid-west institutions and replacement ratio studies indicate we are well ahead of the current industry recommended replacement amounts.

OSU has not recommended changes in the contribution schedule since 2004. This change will result in potential savings to the university with the potential savings increasing each year.
OTRS Changes Effective July 1, 2018, News You Can Use Article

New employees have 30 days from date of hire to make a one-time, irrevocable election to participate in either the Oklahoma Teachers’ Retirement System (OTRS) Plan or the OSU Alternate Retirement Plan (ARP). Effective July 1, 2018, new hires who elect to participate in OTRS will pay the OTRS member contribution of 7% of compensation via pre-tax payroll deduction; OSU will continue to pay the 8.55% employer contribution.

Please note this change in OTR member contributions will not affect employees who are currently participating in the Oklahoma Teachers’ Retirement System plan. New employees who do not wish to make employee contributions can elect the Alternate Retirement Plan (ARP). The ARP is a defined contribution plan with employer contributions forwarded to TIAA. There are no changes to the ARP at this time.

Employees who are re-hired, but made a one-time irrevocable election into OTR prior to July 1, 2018, will be grandfathered into the contribution schedule and will not be required to pay the 7% member contribution.

In addition to aligning more closely with peer institutions, the OTR member contribution change will also provide a more fair and balanced retirement option for new employees. OSU employees choosing the Alternate Retirement Plan (ARP) through TIAA receive a contribution benefit equal to 11.5% of base salary. The 15.55% OTR contribution is based on total compensation including benefits, which totals about 19% of base salary.

OSU’s current contribution rates and offerings are at the top of those offered by comparative mid-west institutions and replacement ratio studies indicate we meet or exceed current industry standards.

The OSU /A&M Board of Regents approved this change on March 2, 2018. The Dean’s Council, Staff Advisory Council, Faculty Council and Retirement Investment Committee have been informed and provided the opportunity for input into the OTR member contribution changes.

OSU has received national recognition for its management of the defined contribution retirement plans, including the Alternate Retirement Plan (ARP), by providing excellent investment options, low fees, great services, higher than minimum recommended replacement ratios, and portability. OSU’s current contribution schedule is at the top quadrant of those offered by comparative mid-west institutions.

OSU has not recommended changes in the contribution schedule since 2004. This change will result in considerable savings to the University with the potential savings increasing each year.
Frequently Asked Questions (FAQs)

How do I calculate the 7% contribution? The 7% contribution is based on your total compensation. Total compensation is your base salary plus the amount OSU pays towards your life and health benefits, including any wellness credits and OSU contributions to your Flex Spending (FSA) or Health Savings (HSA) accounts. An example calculation has been provided in the Retirement Program Guide and the Choosing a Retirement Election video.

Will I have to make up contributions if I miss the payroll deadline? Yes. Contributions will apply retroactively based upon your eligibility date and must be made up on the next payroll.

Can the make-up amount be split over a few payrolls? Per OTRS guidelines, the full make-up amount will be remitted at one time.

I worked for OSU previously and was a member of OTRS. During my prior employment, OSU made my contribution. Do I now have to make the contribution? If you made an irrevocable election during your employment with OSU between July 1, 2004, and June 30, 2018, you will be grandfathered into the old plan, where OSU makes your contribution. Please work with OSU Benefits to confirm your enrollment and if this is applicable to you. If your employment was prior to July 1, 2004, you would likely not have an irrevocable election agreement and will be responsible for paying the 7% contribution if you choose to join OTRS.

What happens if I do not make an election? By state statute, if you do not make an election within 30 days, you will be default enrolled into OTRS and you will be responsible for paying the 7% contribution. This enrollment into OTRS will be irrevocable.

What does OSU contribute? If you choose OTRS, OSU contributes 8.55% of your total compensation. The employer contribution is a statutory employer fee. The 8.55% is not deposited into your personal OTRS account; rather this fee is remitted to aide in the funding of OTRS. If you choose to participate in the ARP and are working 0.75 FTE or greater, then OSU will contribute 11.5% of your base salary, on your behalf, to the ARP vendor, TIAA. You are not required to make a contribution under the ARP. You will have a two-year vesting period with the ARP; therefore, if you leave the university before becoming vested, then you will forfeit the contributions made to TIAA by OSU.

When I leave OSU, how do I receive my money? OTRS has a four month waiting period, in that they require a four month break-in-service from your OTRS-participating employer before remittance of contributions; therefore, you would not be able to work part-time or even in a temporary or student position and request withdrawal from OTRS.