Save for retirement with rollovers, Roth

Employees who are looking for additional ways to enhance their retirement savings should consider rollovers and the Roth option. These features are available under IU’s supplemental retirement plans (the Tax Deferred Account  and IU 457(b) Plan), and offer greater flexibility and discretion over how you save for retirement.

Rollovers

Employees with assets from a former employer’s retirement plan – such as a 403(b) or 401(k) – or an Individual Retirement Account can “roll” some or all of those funds directly into an IU supplemental retirement plan without incurring taxes or penalties. Consolidating your retirement accounts can make it easier to track your savings and investments and could result in reduced fees and expanded investment options. Learn which types of rollovers are accepted and how to start the process.

Roth option

Traditional contributions to IU supplemental retirement plans are made with pre-tax dollars, meaning taxes on contributions and earnings aren’t paid until the money is withdrawn. The Roth option allows contributions to be made with after-tax dollars, resulting in tax-free* withdrawals in retirement.

This option could be beneficial to anyone interested in having both taxable and nontaxable assets to draw from in retirement, or to those who want to leave tax-free assets to their beneficiaries. Employees can start or stop Roth contributions at any time by submitting an Optional Benefit Change through the Employee Center. Visit the Roth option web page for additional details and enrollment instructions.

Additional details

As a reminder, academic and staff employees appointed at 50 percent or more full-time equivalent (FTE), and employees classified as temporary with retirement, are eligible for the Tax Deferred Account. All employees are eligible for the IU 457(b).

Employees are encouraged to talk with a tax professional or Fidelity Retirement Planner to discuss the limitations and requirements of rollovers and Roth contributions before taking any action. For general questions about IU retirement plans, contact IU Human Resources at askhr@iu.edu.

Virtual workshop

Employees who are new to investing can join Fidelity on Sept. 21 for a live virtual workshop, “Take the First Step to Investing.” It will cover key investing concepts, common investment types and how to choose an investment approach. Reserve your spot today.

*Earnings can be withdrawn tax-free as long as it’s been five years since your first Roth contribution and you’re at least 59½ years old.