UTSaver Plan Overview
You may be familiar with the Teacher Retirement System (TRS) or the Optional Retirement Program (ORP) because participation in one of these programs is mandatory for University of Texas benefits-eligible employees. However, these plans will only replace a portion of your income in retirement.
The UTSaver Tax Sheltered Annuity (TSA) and UTSaver Deferred Compensation Program (DCP) are designed to help you save more money on your own so that you have the income needed to last throughout your years in retirement.
These programs allow you to defer additional income for retirement through pre-tax and/or Roth after-tax contributions. By making pre-tax contributions from your paycheck, you reduce your taxable income. Any earnings on your pre-tax investments grow tax-deferred until you withdraw the money from your account, which may mean lower income tax rates in retirement. Roth after-tax contributions will be subject to income taxes before they’re invested in your account, but qualified withdrawals of your contributions and any earnings can be taken tax-free when you retire. These programs do not include an employer contribution.
Is the UTSaver TSA or DCP right for you?
That will depend on your career and retirement goals. You may want to speak to your Voya financial professional or tax advisor for help in deciding which program is best suited to your goals.
Investment adviser representative and/or registered representatives of, and securities and investment advisory services offered through Voya Financial Advisors, Inc. (member SIPC). Investment advisory services are only offered through Investment adviser representatives of Voya Financial Advisors.
You should consider the investment objectives, risks, and charges and expenses of the variable product and its underlying fund options; or mutual funds offered through a retirement plan, carefully before investing. The prospectuses/prospectus summaries/information booklets contain this and other information, which can be obtained by contacting your local representative. Please read the information carefully before investing.
Mutual funds under a trust or custodial account agreement are intended to be long-term investments designed for retirement purposes. If withdrawals are taken prior to age 59 ½, an IRC 10% premature distribution penalty tax will apply, unless an IRS exception applies. Account values fluctuate with market conditions, and when surrendered, the principal may be worth more or less than the original amount invested. A group fixed annuity is an insurance contract designed for investing for retirement purposes. The guarantee of the fixed account is based on the claims-paying ability of the issuing insurance company. Although it is possible to have guaranteed income for life with a fixed annuity, there is no assurance that this income will keep up with inflation. Money taken from the plan will be taxed as ordinary income in the year the money is distributed. An annuity does not provide any additional tax benefit, as tax deferral is provided by the Plan. Annuities may be subject to additional fees and expenses, to which other tax-deferred funding vehicles may not be subject. However, an annuity does offer other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.
For 403(b)(7) custodial accounts, employee deferrals and employer contributions (including earnings) may only be distributed upon your: attainment of age 59½, severance from employment, death, disability, or hardship. Note: hardship withdrawals are limited to: employee deferrals and '88 cash value (earnings on employee deferrals and employer contributions (including earnings) as of 12/31/88).