Retirement Savings Plans
Northwestern University has two 403(b) retirement savings plans:
- Retirement Plan
- Voluntary Savings Plan
Attention: Elect to maximize the Retirement Plan's 5% match BEFORE contributing to the Voluntary Savings Plan.
See the Retirement Savings Plans Summary Plan Description, Making Sense of Your Benefit, and Roth After-Tax Contribution Option notices for more information on both plans.
Contributions
The Retirement Savings Plans allow the following pre-tax contribution types:
- University automatic contribution of 5%. Once eligible, Northwestern will automatically contribute to your Retirement Plan account each pay period.
- Matched contributions of 1%-5% of eligible earnings. Once eligible, Northwestern will match your employee contributions to the Retirement Plan dollar-for-dollar up to 5% of your eligible earnings. Ensure you are maximizing the 5% match to the Retirement Plan before making any supplemental contributions to the Voluntary Savings Plan.
- Voluntary contributions. Contributions made before eligibility is met for the Retirement Plan OR If eligible for the Retirement Plan and contributing 5% in Matched contributions, then supplemental contributions to the Voluntary Savings Plan are allowed as a percentage of eligible earnings or as a flat dollar amount. This is entirely funded by pretax contributions by the employee.
To enroll or change your Retirement Savings Plans contributions amounts, see the Make Changes to Contribution Amounts & Investments webpage.
For deferral changes effective your first paycheck in 2025, you MUST make the request between the following dates:
- Monthly
- Request Change: 1/1/2025-1/17/2025
- Paycheck: 1/31/2025
- Biweekly
- Request Change: 12/22/2024-1/1/2025
- Paycheck: 1/10/2025
IRS Dollar Limits on Contributions | 2024 Annual Limits | 2025 Annual Limits |
---|---|---|
Eligible salary limit | $345,000 | $350,000 |
Employee total contribution limit | $23,000 | $23,500 |
Age 50 catch-up limit (above and beyond the limit) | $7,500 | $7,500 |
Employee and employer aggregate contribution limit | $69,000 | $70,000 |
You have a choice of contributing pre-tax and after-tax Roth dollars to the Plans. Pre-tax contributions come out of your paycheck before your income is taxed, which lowers your taxable income and saves you money on taxes today. Roth after-tax contributions do not reduce your current taxable income; you pay income taxes at the time you make contributions to the Retirement Plan, the Voluntary Savings Plan, or a combination of both. While paying taxes today on Roth contributions will reduce your take-home pay, when you retire you will pay no taxes on the Roth distributions you receive, including any investment gains your Roth contributions may have earned over the years. See Roth Contribution Option and Roth FAQ sheet for additional details and considerations.
A Roth in-plan conversion feature is also available, for more information contact your investment company.
- Fidelity: call 800-343-0860 or schedule a meeting online.
- TIAA: call 800-842-2252 or schedule a meeting online.
Eligibility
Retirement Plan
Benefits-eligible employees scheduled to work half-time or more (18.75 or more hours per week), who are at least age 21 and have completed at least one year of continuous service, may participate in the Northwestern University Retirement Plan.
Waiver Exception: You may be credited with one year of service if you submit a Waiver Form documenting that you (1) were employed by a tax-exempt educational or research organization or a state educational organization for at least a 12-month period ending 60 or fewer days before your Northwestern Date of Hire; and (2) received employer contributions under a Code Section 403(b), 401(a) or 401(k) retirement plan maintained by this organization 60 or fewer days before your Northwestern Date of Hire.
True-up Adjustment: Faculty and staff who fail to maximize their 5% match to the Retirement Plan and, at the same time, are contributing to the Voluntary Savings Plan, will receive a true-up adjustment. For the true-up adjustment the University will recalculate your matching contributions based on your elective deferrals to both the Retirement Plan and Voluntary Savings Plan and eligible earnings for the period during year you were eligible for University contributions. If this amount is greater than the amount of the matching contributions already contributed to your Retirement Plan account for the year, the University will make an additional “true-up” matching contribution equal to the difference. This calculation is done after the close of the plan year. Funds are deposited directly into your account with Fidelity and/or TIAA; not through payroll. The deposit is typically done between mid- to late March for the prior year. You may not be notified that you received a true-up contribution, so review your account with Fidelity and/or TIAA.
Voluntary Savings Plan
All actively employed Faculty and Staff with eligible earnings may participate beginning on their date of hire, there are no length of service or age requirements. Students, graduate students and temporary employees such as adjuncts (but excluding contractors, consultants, and leased employees) on the payroll of the University may participate to the extent they have eligible earnings.
If you are contributing to the Voluntary Savings Plan BEFORE becoming eligible for the Retirement Plan, your voluntary contributions will not automatically be transitioned to the Retirement Plan. Ensure you elect to maximize the Retirement Plan's 5% match BEFORE contributing to the Voluntary Savings Plan.
Eligible earnings
Eligible earnings for contributions to the 403(b) retirement plans generally means your base salary or wages. Eligible earnings do not include scholarships, reimbursements or other expense allowances, severance pay, stipends for living or other expenses (for example to graduate students) and NRSA earnings.
Supplemental pay and pay for temporary assignments and additional assignments are included for employees who do not meet the IRS limit of highly compensated.
Protect yourself from cyber threats
Here are 4 steps you can take to help protect your retirement accounts:
- Register, set up and routinely monitor your online accounts
- Use strong and unique passwords
- Use multi-factor authentication
- Keep personal contact information current
To protect your devices and stay cyber safe, be wary of free wi-fi, close or delete unused accounts and beware of ‘phishing’. A phishing message aims to trick you by looking like it comes from a trusted organization, but in fact is luring you to click on a dangerous link or pass along confidential information to gain access to your accounts. Stay cyber safe!