UTSaver TSA Overview

Below are the important features about your Plan.  This website is intended to be a summary of the plan provisions.  In the event that a conflict exists between the information contained within this website and the plan document, the plan document provisions prevail.  For more information, please contact your local representative.

Whether you are in the Teacher Retirement System or the Optional Retirement Program, you can enjoy the benefits of systematically saving pretax dollars by contributing to the UTSaver Tax-Sheltered Annuity (UTSaver TSA) Program. The UTSaver TSA is a voluntary supplemental retirement savings plan authorized under Section 403(b) of the Internal Revenue Code. Contributions to a 403(b) Tax-Sheltered Annuity Program will reduce your currently taxable income. Under this program, you may choose to contribute under either a 403(b)(1) variable annuity contract, issued by Voya Retirement Insurance and Annuity Company, or a 403(b)(7) custodial account offered through Voya Financial Partners, LLC, which offers mutual funds. 

Highlights of the UTSaver TSA program include:

  • Choices and control of your investments
  • The flexibility to invest on a Tax-deferred or after tax basis depending upon your specific needs
  • Portability of your account - If you terminate employment with the University of Texas System, you can take your vested account balance with you.
  • Personalized, prompt account services
  • Retirement information and services that continue even after you retire
  • A variety of payout options at retirement
  • Declared interest rate on the Voya Fixed Plus Account II (offered through Voya Retirement Insurance and Annuity Company)
  • Unlimited transfers between variable investment options via Internet, phone, or in writing, subject to Voya’s policy on market timing and excessive trading
  • Personalized, individual assistance

How does the UTSaver TSA Program work?

You decide, within certain Internal Revenue Code (IRC) limits,how much of your income you want to invest. You and your employer agree that this amount will be automatically deducted from your salary. The employer will remit the money to Voya for investment into your UTSaver TSA 403(b)(1) annuity contract account or your UTSaver TSA 403(b)(7) custodial account. 

Both the 403(b)(1) variable annuity contract and the 403(b)(7) custodial account provide you with the opportunity for:

  • Asset building - A great way to invest for future needs and supplement your retirement income.
  • Tax-deferred or after tax investing:
    • Tax-deferred investing - Under the Internal Revenue Code, with a traditional 403(b) program, you are taxed only when you begin taking distributions, at which time you may be in a lower tax bracket
    • After-tax investing – Under the Roth 403(b) option, contributions are made on an after-tax basis, and contributions and earnings may qualify for tax-free distribution if certain requirements are met. The distribution would be tax free as long as you’ve satisfied the five-year holding period and are age 59 1/2 or older, disabled or deceased.
  • Diversified investment options - You have the opportunity to select where your contributions are allocated.
  • Portability of your account - If you terminate employment with the University of Texas System, you can take your vested account balance with you.
  • Unlimited transfers between variable investment options via Internet, phone or paper within either the 403(b)(1) variable annuity or the 403(b)(7) custodial account, subject to Voya’s policy on market timing and excessive trading.

In addition, the 403(b)(1) variable annuity contract also provides:

  • Periodic annuity payments for the future - Under the annuity provisions, you choose the payout option that best fits your future needs. A 1.25% M&E applies to payments made on a variable basis during annuitization.
  • No surrender/withdrawal charges. Fund management fees and fund operating expenses apply and a mortality and expense risk charge may apply. (See the “Service Options” section for more information on the mortality and expense risk charge for each option.)

Roth 403(b)

Effective December 1, 2006, Voya’s UTSaver TSA annuity contract and mutual fund options offer you the opportunity to make after-tax contributions to the 403(b) program under the Roth 403(b) option. Whether it better suits your personal financial situation to contribute to the UTSaver TSA program with pre-tax or after-tax payroll deductions is up to you. 

You may also want to check out the Roth Contribution Comparison Calculator. This interactive calculator is designed to help compare the possible results of investing on a Traditional (pre-tax) and/or Roth (after-tax) basis.

If you do not yet participate in the UTSaver TSA with Voya, you may select the Roth 403(b) option when you enroll. If you already have a Voya Annuity contract or mutual fund custodial account with us under the UTSaver program, you can add the Roth 403(b) contribution option to your account. Please contact your Voya representative for the appropriate paperwork to be completed. 

Service Options Available

Both the 403(b)(1) annuity contract and the 403(b)(7) custodial account provide you with two service options:

Mentor Model for the 403(b)(1) annuity contract – if you would like assistance from a financial professional in determining amounts to save and if you desire education regarding your retirement plan program, you can elect to work with a Voya representative under the Mentor Model. Your Voya representative will provide you with the following services:

  • One on one enrollment assistance including assistance with enrollment paperwork and submission to Voya.
  • Counseling in determining amounts to save and appropriate asset allocation strategies.
  • Periodic account reviews to ensure you remain on track to meet your investment objectives.

There is a mortality and expense risk charge of 0.50% on all variable assets in the 403(b)(1) annuity contract under this option during the accumulation phase. 

To speak to a Voya representative about the Mentor Model Service Option, please contact us.

Direct Access Model – you enroll in either the 403(b)(1) annuity contract or the 403(b)(7) custodial account directly through on-line enrollment available through this website. You will choose how to invest your contributions without one on one counseling from a local Voya representative. No mortality and expense risk charge (M&E) is assessed under the annuity contract during the accumulation phase. No M&E or advisory fee is assessed under the 403(b)(7) custodial account. Click here for enrollment information. 

Variable annuities and mutual funds offered through a retirement plan are intended as long-term investments designed for retirement purposes, which allow you to allocate contributions among variable investment options that have the potential to grow tax-deferred, or in the case of Roth contributions, tax free, with an option to receive a stream of income at a later date. Early withdrawals may be subject to surrender charges, and if taken prior to age 591/2, a 10% IRS penalty may apply. Taxes are due upon withdrawal of tax-deferred assets; withdrawals will also reduce the applicable death benefit and cash surrender value. Account values fluctuate with market conditions, and when surrendered the principal may be worth more or less than its original amount invested. Annuities may be subject to additional fees and expenses to which other tax-qualified funding vehicles may not be subject. An annuity does not provide any additional tax deferral benefit, as tax deferral is provided by the plan. However, an annuity does provide other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.

Contributions

An IRS formula determines how much you may defer in any given year -- and can give credit beyond the general maximum for past years when you did not defer income. Your local representative can help you calculate your maximum deferral amount. 

Your employer will forward your contributions to Voya for investment in your choice of options. You will receive a quarterly account statement, which will summarize your account's financial activity.

Does the UTSaver TSA affect the benefit calculations of my TRS, ORP or Social Security?

No. Your total gross pay, including amounts that are deferred, is used for the calculation of benefits for those programs. 

What happens if I change employers?

Your account is portable and can be continued on a tax-deferred basis if your new employer sponsors a retirement plan that allows rollovers of such funds. Or, you may leave your funds in the account and continue to receive tax deferred investment experience until you elect to receive them. 

What if I die before I retire?

Your named beneficiary will receive the total current cash value of your account, or may select a settlement option. If your spouse is your beneficiary and wants to delay receipt of the income for tax purposes, he/she can do this up until the time you would have reached age 70½. For the Mentor Model for the 403(b)(1) variable annuity contract only, a guaranteed death benefit is available. If the beneficiary requests a lump sum payment or an annuity payout option within six months of the participant's death, the death benefit is guaranteed to be greater of: a) the account value minus any outstanding loan balances, or b) total contributions made to your account minus any loans, withdrawals or annuitizations. Guarantee based on the claims paying ability of Voya Retirement Insurance and Annuity Company.

Under the Plan, the maximum annual contribution amount is set by IRS guidelines on a yearly basis.  You may view the current limits below.

Contribution Limits
Year Annual Maximum
2017 $18,000 regular limit
$24,000 Over 50 Catch-up Limit ($6,000 over the regular limit)
$36,000 Normal Retirement Age catch-up limit (Double the regular limit)

 

Loans

Loans are only available under the 403(b)(1) annuity contract. Loans are NOT available from any funds held in the 403(b)(7) custodial account. A loan provision is available to all participants with an account value of at least $2000. You may borrow up to 50% of the UTSaver TSA 403(b)(1) value, not to exceed $50,000. The interest rate is 6% - 2.5% is retained by Voya Retirement Insurance and Annuity Company with the remaining 3.5% credited to the participant’s account. The maximum term for all loans is 5 years; unless the loan is used to acquire your principal residence, in which case the maximum loan term may be extended to 20 years. Loan repayments are made quarterly. Please note: loans will reduce your account balance, may impact your withdrawal value and limit participation in future growth potential. Other restrictions may apply.

Withdrawals

Any contributions that you make to your UTSaver TSA 403(b)(1) annuity contract after 12/31/88 and any earnings on the total account value that accumulates after 12/31/88 may only be withdrawn under one or more of the following circumstances:

  • Severance from employment;
  • Attainment of age 59½;
  • Your death or disability; or
  • Financial hardship.

There are no Internal Revenue Code withdrawal restrictions on employee deferrals (including earnings) as of 12/31/88 or any employer contributions (including earnings).

Note: Financial hardship withdrawals are limited to:

  • Employee Deferrals made after 12/31/88.

Any contributions that you make to your UTSaver TSA 403(b)(7) custodial account may only be withdrawn under one or more of the following circumstances:

Employee deferrals and employer contributions (including earnings) may only be distributed upon your:

  • Severance from employment
  • Attainment of age 59 ½
  • Your death or disability, or
  • Financial hardship.

Note: Financial hardship withdrawals are limited to:

  • Employee Deferrals; and
  • Earnings on any employee deferrals and employer contributions (including earnings) as of 12/31/88

For both the 403(b)(1) annuity contract and the 403(b)(7) custodial account, a 10% federal penalty tax may be assessed on withdrawals unless you:

  • Are age 59 ½;
  • Become disabled or die;
  • Separate from service in the same year or later than the year in which you reach age 55;
  • Receive the funds under a settlement option payable over your lifetime or the lifetimes of you and your beneficiary;
  • Use the funds to pay sizable medical bills not covered by insurance;
  • Use the funds to pay a federal tax levy;
  • Make payments made under a qualified domestic relations order; or
  • Exchange the funds for another 403(b) account or rollover the funds into an IRA.

Distributions

When you are ready to retire, you may choose from several disbursement options including:

  • Lump sum withdrawal;
  • Partial withdrawal;
  • Systematic withdrawal by specifying a percentage, a dollar amount, or a time period;
  • Payments guaranteed for your lifetime or for as long as either you or your beneficiary are alive. Guarantees are based on the claims-paying ability of VRIAC. A 1.25% M&E applies to payments made on a variable basis during annuitization

Under the 403(b)(7) custodial account, there are no systematic payouts, guaranteed lifetime or guaranteed specified period payment options available. When you retire, you may:

  • Request a full or partial withdrawal (may be subject to federal withholding and possible tax penalties).
  • Utilize the funds to purchase a single premium immediate annuity.
  • Rollover to an IRA or another eligible retirement plan.

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.

Variable annuities and mutual funds offered through a retirement plan are intended as long-term investments designed for retirement purposes. Money distributed from the 403(b) Plan and the 457 Plan will be taxed as ordinary income in the year the money is received. Withdrawals taken from either the 403(b)(1) variable annuity or the 403(b)(7) custodial/trust account prior to age 59½ will be subject to a 10% federal penalty tax. This IRS premature distribution penalty tax does not apply to 457 plans. Account values fluctuate with market conditions, and when surrendered the principal may be worth more or less than its original amount invested. Annuities may be subject to additional fees and expenses to which other tax-qualified funding vehicles may not be subject. An annuity does not provide any additional tax deferral benefit, as tax deferral is provided by the plan. However, an annuity does provide other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.

For 403(b)(1) fixed or variable annuities, employee deferrals (including earnings) may generally be distributed only upon your: attainment of age 59½, severance from employment, death, disability, or hardship. Note: Hardship withdrawals are limited to employee deferrals made after 12/31/88. Exceptions to the distribution rules: No Internal Revenue Code withdrawal restrictions apply to '88 cash value (employee deferrals (including earnings) as of 12/31/88) and employer contributions (including earnings). However, employer contributions made to an annuity contract issued after December 31, 2008 may not be paid or made available before a distributable event occurs. Such amounts may be distributed to a participant or if applicable, the beneficiary: upon the participant's severance from employment or upon the occurrence of an event, such as after a fixed number of years, the attainment of a stated age, or disability. 

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).

 

Not FDIC/NCUA/NCUSIF Insured | Not a Deposit of a Bank/Credit Union | May Lose Value | Not Bank/Credit Union Guaranteed | Not Insured by Any Federal Government Agency 

Insurance products, annuities and retirement plan funding issued by (third party administrative services may also be provided by) Voya Retirement Insurance and Annuity Company ("VRIAC"), Windsor, CT. VRIAC is solely responsible for its own financial condition and contractual obligations. Plan administrative services provided by VRIAC or Voya Institutional Plan Services LLC ("VIPS").  VIPS does not engage in the sale or solicitation of securities. All companies are members of the Voya® family of companies. Securities distributed by Voya Financial Partners LLC (member SIPC) or third parties with which it has a selling agreement. Custodial account agreements or trust agreements are provided by Voya Institutional Trust Company. All products and services may not be available in all states.