Summary of MnSCU Retirement Plans
Mandatory Retirement Coverage
In almost all positions at MnSCU you are required to be covered by one of the primary retirement plans. Certain unclassified employees (generally, those who have always been employed for less than 25% of a full-time position) may not be covered by a primary retirement plan. The primary retirement plans are:
Teachers Retirement Association (TRA), MSRS General and PERA.
These are all defined benefit plans, sometimes called pension plans. This type of plan provides you a benefit at retirement based on a formula that takes into account your years of service, High-5 Compensation and the age at which you begin to receive benefits. The basic benefit is NOT based on how much you contribute or how successful the investment manager is.
MSRS Unclassified, and MnSCU Defined Contribution Retirement Plan (which includes both Individual Retirement Account Plan (IRAP), and Supplemental Retirement Plan (SRP)).
These are defined contribution plans available only to unclassified employees. These types of plans provide you a benefit at retirement based on the amount of your contributions, MnSCU contributions and the market value change (earnings). The investments you select, and the performance of those investments, over time will have a significant effect on the amount of your retirement benefit.
Voluntary Retirement Coverage.
In addition to the primary retirement plans, employees can choose to contribute additional amounts to two other retirement plans. Employees can contribute to one or both of these plans, but are subject to the IRS regulatory maximums.
Deferred Compensation Plan (sometimes called the 457 Plan).
This is a non-qualified plan that is managed by the Minnesota State Retirement System. You must sign up for salary deferral contributions and direct the investment of those contributions among the various approved vendors. You are limited to $17,500 or 100 percent of your taxable income, whichever is less, per year under current regulations, with catch-up provisions available to certain employees.
Tax Sheltered Annuity Program (sometimes called the TSA or 403(b)) Program.
This is a qualified retirement plan that is managed by TIAA-CREF. You are limited to $17,500 or 100 percent of your taxable income, whichever is less, per year under regulations, with catch-up provisions available to certain employees. You must sign up for salary deferral contributions through Employee Self Service.
Which Plan am I Participating In?
If you do not know for sure which retirement plan(s) you are in, look at your pay stub for the various deductions that you have had year-to-date. The description names for these deductions may help you. Also, look closely at the headings on your quarterly or annual retirement statements. The headings should identify the plan closely to the names above. Be careful in reviewing the headings since some plan names are very similar - Deferred Compensation is the 457 plan; Defined Contribution includes both IRAP and SRP.