Employees age 55 and older with 10 years of full time service may retire from the University and be eligible for certain retiree benefits. The Human Resources Department requests 3 months written notice prior to retirement. Employees are responsible for providing their department supervisor with timely notification of their retirement date.
The age of the employee at the time of retirement determines eligibility for various retirement benefits including retiree medical coverage, retiree life insurance, tuition remission, tuition exchange and distribution from the University retirement plans. More information about these benefits, including eligibility requirements and benefit descriptions, is below.
Villanova University offers eligible retirees several health insurance options through the Retiree Medical Plan. The University contributes $1,300 per year towards the cost of this coverage.
If you retire from employment with the University after May 31, 2018, the University will not contribute to the cost of your retiree health coverage under this plan.
All full-time employees who retire from the University at age 62 or older and who have completed 10 or more years of active credited service are eligible to participate in the Retiree Medical Plan once they reach age 65. Full-time status is determined in accordance with the University’s personnel policies and practices in force at the time of the determination of eligibility. A full-time employee who receives worker’s compensation benefits and/or long-term disability benefits is eligible to participate in the plan if he or she attained age 62 and completed at least 10 years of service with the University at the time of the injury or disability.
Eligible retirees may elect to participate in the plan as of the first of the month following the retirement date. To become a participant, retirees must meet with the University retiree medical consultant to select a medical plan and pay any required contribution(s). Once a retiree makes an election to participate in the plan, the election may be changed only (1) if the retiree has a change in status, or (2) during an open enrollment period at then applicable rates. If the retiree fails to make an election for health coverage upon initial eligibility for coverage, or drop coverage for a period of time, the retiree may enroll or reenroll in coverage only (1) if the retiree has a change in status, or (2) during an open enrollment period at then applicable rates. If the retiree fails to make an election for health coverage during an open enrollment period, the retiree will be deemed to have elected to maintain the same health coverage elections (at then applicable rates) for the upcoming plan year. Therefore, it is extremely important that retirees enroll in the plan within the time period prescribed by the Plan Administrator.
Eligible retirees between age 62 and 65 may continue their medical coverage in the active employee plan until age 65. Eligible retirees may also elect to continue medical coverage for their spouse and eligible dependents until the retiree attains age 65. The cost of this coverage is the full premium less a University contribution of $1,300 per year. Tenured faculty members with 15 years of full time service age 60 to 65 should refer to the Steady State Retirement Policy found in the faculty handbook for information regarding continuation of medical coverage prior to age 65.
If you retire after May 31, 2018, the University will not contribute towards the cost of this coverage.
Upon attainment of age 65, eligible retirees may enroll in the Retiree Medical Plan. Spouses and dependents are not eligible to participate in the Retiree Medical Plan. Eligible dependents may elect to continue their medical coverage under COBRA.
Eligible retirees age 65 and older are given the choice of medical coverage options that supplement Medicare coverage. The retiree must pay the difference between the monthly cost for the selected health plan and the University’s retiree allowance, which is $1,300 per year. If you retire after May 31, 2018, the University will not contribute towards the cost of this coverage.
In order to enroll in the Retiree Medical Plan, the retiree must be enrolled in Medicare Part A and Part B. Some of the medical options in the plan provide prescription drug coverage. If the retiree enrolls in a medical coverage option that provides prescription drug benefits, the retiree cannot be enrolled in a stand alone Medicare drug plan at the same time.
Employees who retire at age 55 with 10 years of full time service, will receive a life insurance benefit of $5,000. The cost of this benefit is paid entirely by the University. However, if you retire from the University after May 31, 2018, you will not be entitled to this University paid life insurance benefit.
The Villanova University Retirement Savings Plan allows eligible employees to save for retirement by making salary reduction contributions on a tax-deferred basis. Contributions are made to the plan by both the participant and the University. Employee contributions and University contributions are vested immediately. This plan is a defined contribution plan governed by section 403(b) of the Internal Revenue Code.
Eligibility and Participation Effective Date
Full-time and part-time employees are eligible to enroll in the plan by setting up an account online at www.tiaa-cref.org/villanova. First time users must establish a user name and password by clicking on “Register for Access.” After logging on to the website, employees must select investment funds, designate a beneficiary, and elect an amount to contribute to the plan. Leased employees, student employees, independent contractors, and members of the Brothers of the Order of Hermits of St. Augustine are not eligible to contribute to the plan.
In order to receive University contributions, eligible full-time employees must complete one year of service and attain age 21. The one year service requirement will be waived for employees who were employed by a non-profit institution, University, or governmental employer for at least one year prior to employment at Villanova University, and participated in an employer funded retirement plan for all or a portion of this employment. The employee must provide satisfactory proof to the University of prior employment and participation by submitting the Prior Employer Certification Form.
Eligible employees will receive University contributions on the first day of the month following the date the age and service requirements are satisfied.
Part-time employees must complete 1,000 hours of service in a 12-consecutive month period and attain age 21 to be eligible to receive University contributions. University contributions are made for part-time employees at the end of the plan year upon confirmation that the employee has completed 1,000 hours of service.
Faculty Note: The Office of Academic Affairs advises Human Resources as to the classification of a faculty member. Faculty members who are not eligible to receive University contributions include faculty on temporary status, visiting professors with less than 3 consecutive years of full time service, and adjunct faculty members.
Eligible employees receive a University base contribution of 3.5% of their eligible compensation each pay period. Eligible employees with 10 or more years of service receive a University base contribution of 5% of their eligible compensation each pay period. The University also provides a matching contribution up to 5% of eligible compensation each pay period. For example, an eligible employee with less than 10 years of service who contributes 5% per pay to the plan will receive a University base contribution of 3.5% and a matching contribution of 5% for a total University contribution of 8.5% of eligible compensation.
The University selected TIAA-CREF as the single record keeper for the plan. The plan offers a wide range of investment choices, including TIAA-CREF’s annuity products and Vanguard’s Target Retirement Funds, which are based on the employee’s projected retirement date.
The plan has designated a default fund where employee and University contributions will be invested if employees have not made an investment election. The default fund is intended to meet the requirements of a qualified default investment alternative (QDIA). The default fund is the Vanguard Target Retirement Fund with the target-date closest to the year in which the employee will turn age 65.
Employees can change the amount they contribute to the plan and their investment funds at any time by logging on to www.tiaa-cref.org/villanova and selecting the appropriate option under “Manage My Portfolio.”
Limits on Employee Contributions
Employees may contribute up to the dollar limit as determined each year by the Internal Revenue Service. If the employee is age 50 or older, the employee may contribute an additional “catch up” contribution as determined annually by the Internal Revenue Service. The current dollar limit can be found under the 403(b) Employee Contributions Limit section on the Retirement Benefits page.
In Service Distributions
Employees may be eligible to withdraw up to the full amount of employee contributions prior to termination of employment upon attainment of age 59 ½. Hardship withdrawals are permitted under certain circumstances if the employee provides documentation of an immediate and heavy financial need. Hardship withdrawals are limited to employee contributions only. Upon attainment of age 70 ½, employees may request a distribution from their employer contribution account. This distribution is limited to the required minimum distribution amount.
Spousal approval is required for all in-service distributions. In-service distribution requests are subject to Plan Administrator and investment company approval. All distributions are subject to federal taxes and early withdrawal penalties.
The plan permits loans which are repaid through payroll deduction. The minimum loan amount is $1,000 and the maximum loan amount is the lesser of 50% of the employee’s account balance or $50,000. Employees must apply for the loan directly with TIAA-CREF. TIAA-CREF will provide the terms of the loan, for example, fees, interest rates, and repayment periods. A participant may have 2 loans outstanding from the plan at any given time.
Termination of Employment
Upon termination of employment, employees may request a distribution from the plan. Terminated employees may also request a rollover to another employer plan or an individual retirement account. Terminated employees may also leave their account in the plan.
The Villanova University Retirement Income Plan is a defined benefit pension plan funded entirely by the University. On May 31, 1996, exempt employees were given the option to enroll in the Villanova University Retirement Savings Plan and “freeze” their accrued benefit in the Villanova University Retirement Income Plan. Non exempt employees were allowed to make the same election on December 31, 1999. Employees who elected to freeze their accrued benefit are referred to as “DC Electing Employees.” After May 31, 1999, no new participants were admitted to the plan. Faculty members are not eligible to participate in this plan.
Benefits in this plan are determined by a formula. For DC Electing Employees, the following formula applies:
1% of Average Annual Earnings up to $7,800 plus 1.25% of Average Annual Earnings in excess of $7,800, multiplied by years of Credited Service.
Average Annual Earnings is the highest average annual earnings received during any 5 consecutive year period during the 10 years immediately preceding the date the benefit was frozen.
For employees who are active participants in the plan, the following formula applies:
1.25% of Average Annual Earning multiplied by years of Credited Service.
Average Annual Earnings is the highest average annual earnings received during any 3 consecutive year period during the 10 years immediately preceding retirement.
Employees are 100% vested in their accrued benefit after 5 or more years of full time service.
Employees age 55 with 10 years of credited service are eligible for early retirement. Otherwise, normal retirement is the first of the month following attainment of age 65. Late retirement is any date after normal retirement.
If the present value of the accrued benefit is $5,000 or less, the benefit will be paid in a lump sum. If the present value of the accrued benefit is over $5,000, the benefit will be paid in the form of a monthly annuity payment. For married employees, the normal form of benefit payment is the 50% Joint and Survivor Annuity Option. Other joint and survivor options are available. Married employees must receive spousal consent to receive a benefit option other than a joint and survivor annuity. For unmarried employees, the normal form of benefit is a Life Only Annuity Option.
Approximately 2 months prior to the employee’s retirement date, Human Resources will mail the employee a pension benefit election form which includes a list of the values of the various annuity options. The form also includes federal and state tax elections as well as direct deposit information. The employee must provide proof of birth for the employee as well as the spouse and a copy of the marriage certificate, if applicable.
In the event of any discrepancy between the plan documents and this retirement policy, the plan documents always govern.
Villanova University offers two tuition programs to University employees. They are the tuition remission program and the tuition exchange program. Further details regarding these programs can be found under the tuition remission and tuition exchange sections of the HR website.
All full-time employees who retire from the University at age 55 or older and who have completed 10 or more years of active credited service are eligible to continue to receive tuition remission and tuition exchange benefits. Covered individuals include the University retiree, their spouse and eligible dependent children as of the date of retirement. Full-time status is determined in accordance with the University’s personnel policies and practices in force at the time of the determination of eligibility. A full-time employee who receives worker’s compensation benefits and/or long-term disability benefits is eligible to participate in the plan if he or she completed at least 10 years of service with the University at the time of the injury or disability. Covered individuals include the University retiree, their spouse and eligible dependent children as of the date of injury.
In the event of any discrepancy between the plan documents and this retirement policy, the plan documents always govern.