Three Sources of Retirement Income
In order to properly prepare for your retirement, you must first consider
where your retirement income will be coming from and how much it will be.
As a Duke employee, you can expect your retirement income to come from
three primary sources:
1. SOCIAL SECURITY
The Social Security benefit amount will depend upon when you decide to
retire and begin to receive your Social Security benefits.
For more information on Social Security and its contribution to your
retirement income, visit the Social
Security Administration home page.
2.DUKE'S CONTRIBUTION TO YOUR RETIREMENT
PLAN
The Employees' Retirement Plan (for non-exempt employees) Duke contributes to the retirement of non-exempt employees
through the Employees'
Retirement Plan (ERP). Duke pays 100% of this plan. There is no cost to you.
The ERP is designed to provide a guaranteed monthly income when
you retire. Your actual benefit will depend upon your salary and years of service. You are entitled to a benefit from this plan after you have completed
five years of continuous service after you have reached the age of
18—this is known as vesting.
The Faculty and Staff Retirement Plan (for exempt employees)
Exempt employees do not receive a benefit under the Employees' Retirement
Plan. Instead, Duke provides an employer contribution through
the Faculty and Staff Retirement
Plan. In order to receive the Duke contribution to the Faculty and Staff
Retirement Plan, you must meet all
of the following conditions:
- You must contribute to the Faculty and Staff Retirement Plan;
- You must be salaried;
- You must be regularly scheduled to work at least 1,000 hours per year;
- You must be at least age 21; and
- You must have at least one year of continuous service at Duke.
You are exempt from the one-year continuous service requirement if you
meet any of the following qualifications:
- You are a faculty member with an academic rank of professor or associate
professor; or
- You are a staff member in fringe benefits category 1; or
- You have participated in or received an employer contribution to a
403(b) base plan from your immediate prior employer.
You are vested—that is, you own—the contributions that Duke makes to
your plan.
3. YOUR CONTRIBUTIONS TO YOUR RETIREMENT
PLAN
The 403(b) Retirement Plan
The 403(b) retirement plan (similar to a 401(k) retirement plan) provides a way for you to put money aside for
retirement through tax-deferred contributions to investments/mutual
funds.
Your contributions are taken from your salary before you receive each
paycheck. Therefore, your salary is reduced. The amounts taken as a
contribution to your retirement savings account are called deductions. These salary deductions are not subject to federal or North Carolina
income tax withholding. However, these deductions are subject to the
Social Security tax, also known as the Federal Insurance Contributions
Act, or "FICA."
Duke offers 5 vendors - Fidelity, Scudder, TIAA-CREF, AIG Retirement, and Vanguard - and more than
300 funds from which to choose. You
choose the vendors and funds with which you wish to invest.
Your contributions and earnings on investments are not taxed until you
withdraw them in cash.
The Faculty and Staff Retirement Plan and the Savings for Retirement Plan
Non-exempt employees contribute to the 403(b) plan through the Savings
for Retirement Plan, while exempt employees contribute through the Faculty and Staff Retirement Plan.
The vendors and funds are the same for both of these retirement plans.
The only difference between the two lies in the employer contribution:
- Exempt employees receive their employer contribution through the Faculty
and Staff Retirement Plan.
- Non-exempt employees receive their employer contribution through the Employees'
Retirement Plan (ERP).
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