Participation in a retirement program is required for permanent, probationary, or time-limited employees who work at least 3/4 time for nine months. Employees are required to contribute 6% of their salaries toward the cost of their retirement. There are two retirement programs available.
Teachers' and State Employees' Retirement System (TSERS)
The Teachers' and State Employees' Retirement System is a defined benefit plan. Under this type of plan, the benefit you receive at retirement is based on a formula. This formula considers your years and months of creditable service, your age, and your "average final compensation," which is the average of your salary during your four highest paid consecutive years. Neither the investment experience of the plan assets, nor the amount contributed by you and the University, on your behalf, directly determines the guaranteed benefit you will receive at retirement. Click here to view the Retirement System Handbook.
Optional Retirement Program
The University of North Carolina Optional Retirement Program is sponsored by the University of North Carolina system. The Board of Governors of The University of North Carolina is responsible for the administration of the ORP, and designates the vendors authorized to offer investment products.
This program is an option or alternative to the North Carolina Teachers' and State Employees' Retirement System (TSERS) for certain employees. Under the ORP, you control your investment choices, distribution methods, and retirement goals; whereas the State controls the investments under TSERS.
The ORP is a defined contribution plan. The University has authorized four vendors to offer investment products under the ORP. These are Fidelity Investments, Lincoln Financial Group, TIAA-CREF, and VALIC. For more information about the authorized companies, or their products, including investment options, services and fees, you should contact a company representative.
Supplemental Retirement Programs
All University employees are encouraged to supplement their state and federal retirement benefits by participating in one or more of the supplemental retirement savings programs available to them. A significant part of the retirement planning process may include voluntary supplemental retirement plans that offer significant tax advantages. The University makes such plans available to eligible employees as authorized under Sections 403(b)(1), 403(b)(7), 457(b) and 401(k) of the Internal Revenue Code. A supplemental retirement plan allows you to make contributions through payroll deductions to a variety of investment vehicles. Please review the Supplemental Retirement Plan Decision Guide, which compares all of the supplemental retirement plans available to eligible faculty and staff. The supplemental programs available are:
UNC 403(b) Plan This program is sponsored by the University of North Carolina System. There are two participating vendors in the program.
Fidelity and TIAA-CREF The program is a supplemental retirement plan that allows employees to set aside payroll-deducted contributions on either a tax-deferred or Roth after-tax basis. All permanent and temporary employees who are subject to FICA withholdings are eligible to participate.
NC 401(k) Plan The North Carolina 401(k) plan is sponsored by the State of North Carolina and governed by the Department of the State Treasurer. The plan administrator for this program is Prudential. The North Carolina 401(k) Plan is a supplemental retirement plan that allows employees to set aside payroll-deducted contributions on either a tax deferred basis or Roth after-tax basis. Permanent full-time employees scheduled to work 30 or more hours per work week are eligible to participate.
NC 457 Plan The North Carolina 457(b) Deferred Compensation Plan is sponsored by the State of North Carolina and governed by the Department of the State Treasurer. The plan administrator for this program is Prudential. The 457(b) is a supplemental retirement plan that allows employees to set aside payroll-deducted contributions on a tax-deferred basis. This means that taxes are not paid on contributions or earnings until the time of distribution. Tax deferred contributions may be invested in fixed and variable accounts under this plan. Account contributions and earnings are required by law to be held in a separate trust for the exclusive benefit of participants and the beneficiaries. All permanent employees (part of full time) and temporary employees are eligible ot participate in this program.