OSU Benefits FairOSU Benefits Fair Retirement Subcommittee of the Retirement Subcommittee of the

Flexible Compensation Benefits CommitteeFlexible Compensation Benefits Committee

Recommended Changes to Recommended Changes to The OSU Retirement The OSU Retirement Program and to OTRSProgram and to OTRS

Who We Are . . .Who We Are . . .

Subcommittee of the Flexible Subcommittee of the Flexible Compensation Benefits Compensation Benefits CommitteeCommittee

Appointed in August 2001 by Appointed in August 2001 by administration to develop a administration to develop a proposal for a competitive proposal for a competitive retirement program for the retirement program for the future.future.

Discussion TopicsDiscussion Topics

Background of the SubcommitteeBackground of the Subcommittee The Current OSU ProgramThe Current OSU Program OTRS Inequities And Proposed OTRS Inequities And Proposed

LegislationLegislation Recommended Changes in OSU Recommended Changes in OSU

RetirementRetirement Expected Changes in TIAA-CREFExpected Changes in TIAA-CREF

Who We Are . . .Who We Are . . .

Subcommittee of the Flexible Subcommittee of the Flexible Compensation Benefits Compensation Benefits CommitteeCommittee

Appointed in August 2001 by Appointed in August 2001 by administration to develop a administration to develop a proposal for a competitive proposal for a competitive retirement program for the retirement program for the future.future.

Subcommittee Subcommittee MembershipMembership Bill Barfield (Faculty, OSU-STW)Bill Barfield (Faculty, OSU-STW)

Brad Barnes (Staff, OSU-STW)Brad Barnes (Staff, OSU-STW) John Dalton (Staff, OSU-STW)John Dalton (Staff, OSU-STW) Camille DeYong (Faculty, OSU-STW)Camille DeYong (Faculty, OSU-STW) Greg Fox (Staff, OSU-STW)Greg Fox (Staff, OSU-STW) Sheila Harp (Staff, OSU-STW)Sheila Harp (Staff, OSU-STW) Sally Henderson (Faculty, OSU-OKC)Sally Henderson (Faculty, OSU-OKC) Darrel Kletke (Faculty, OSU-STW)Darrel Kletke (Faculty, OSU-STW) Terry Lehenbauer (Faculty, OSU-STW)Terry Lehenbauer (Faculty, OSU-STW) Ken Morris (Administrator, OSU-OKM)Ken Morris (Administrator, OSU-OKM) Bob Oehrtman (Faculty, OSU-STW)Bob Oehrtman (Faculty, OSU-STW) Louisa Payne (Staff, OSU-STW)Louisa Payne (Staff, OSU-STW) David Peters (Staff, OSU-STW)David Peters (Staff, OSU-STW) Fran Stromberg (Emeriti, OSU-STW)Fran Stromberg (Emeriti, OSU-STW)

Subcommittee Charge – Subcommittee Charge – 11/0111/01

Develop a retirement program Develop a retirement program that will serve as a competitive that will serve as a competitive advantage when recruiting and advantage when recruiting and retaining faculty and staffretaining faculty and staff

In developing recommendations In developing recommendations for a new retirement program, for a new retirement program, constrained from damaging constrained from damaging current systemcurrent system

Committee ChronologyCommittee Chronology 7/20007/2000 Flexible Benefits Compensation Committee Flexible Benefits Compensation Committee

identifies retirement as an issue in need of further studyidentifies retirement as an issue in need of further study 8/20018/2001 Retirement Subcommittee appointedRetirement Subcommittee appointed 11/200111/2001 Retirement Subcommittee meetsRetirement Subcommittee meets 11/2002 Committee presents interim report to Flexible 11/2002 Committee presents interim report to Flexible

Benefits Compensation CommitteeBenefits Compensation Committee Spring 2003 Presentations to Fac, Staff and Emeritus Spring 2003 Presentations to Fac, Staff and Emeritus

Councils, Joe Alexander, David Bosserman, and Tommy Councils, Joe Alexander, David Bosserman, and Tommy Beavers Beavers

Spring 2003 Presentations to faculty and staff groups at Spring 2003 Presentations to faculty and staff groups at OSU Stillwater, OSU Tulsa, OSU Okmulgee, OSU OKC, and OSU Stillwater, OSU Tulsa, OSU Okmulgee, OSU OKC, and extension districtsextension districts

6/2003 Presentation to President David Schmidly6/2003 Presentation to President David Schmidly 1/2004 Presentation to Provost Marlene Strathe1/2004 Presentation to Provost Marlene Strathe 2/2004 Presentations to Vice President Stephen McKeever 2/2004 Presentations to Vice President Stephen McKeever

and to the OSU Emeriti Associationand to the OSU Emeriti Association

Changes in July 2003Changes in July 2003

7/2003 -- Legislative changes to 7/2003 -- Legislative changes to OTRS to change vesting period from OTRS to change vesting period from 10 to 5 years and reduced optional 10 to 5 years and reduced optional membership age from 55 to 45membership age from 55 to 45

7/2003 -- 7/11% contribution 7/2003 -- 7/11% contribution changed to 11%changed to 11%

7/2003 -- Contribution option added 7/2003 -- Contribution option added for pre-July 1, 1992 employeesfor pre-July 1, 1992 employees

Recent HistoryRecent History OSU retirement program stayed same until OSU retirement program stayed same until

July 1, 1993 when 7/11 plan began.July 1, 1993 when 7/11 plan began. 7/11 plan: OSU contributed to each 7/11 plan: OSU contributed to each

employee’s retirement 7% of first $11,520 of employee’s retirement 7% of first $11,520 of salary and 11% of salary above. salary and 11% of salary above. (Now flat (Now flat 11%)11%)

Employee contribution to OTR taken out of Employee contribution to OTR taken out of above amount, with rest going to TIAA-CREFabove amount, with rest going to TIAA-CREF

The problem: As OTR caps come off, more The problem: As OTR caps come off, more and more going to OTR, less to TIAA-CREFand more going to OTR, less to TIAA-CREF..

Retirement Employees Retirement Employees Can ExpectCan Expect

Consists of four parts:Consists of four parts: Monthly income from OTRMonthly income from OTR Retiree directed benefit from TIAA-Retiree directed benefit from TIAA-

CREFCREF Social SecuritySocial Security Other retirement savingsOther retirement savings

Comparison of OTR and Comparison of OTR and TIAA-CREFTIAA-CREF

OTR is “Defined Benefit Program”.OTR is “Defined Benefit Program”. With OTR what you receive is based on With OTR what you receive is based on

the number of years you work and your the number of years you work and your average compensation level.average compensation level.

TIAA-CREF is “Defined Contribution TIAA-CREF is “Defined Contribution Program”Program” With TIAA-CREF what you receive is With TIAA-CREF what you receive is

determined by the investment choices determined by the investment choices you make.you make.

Comparison of OTR and Comparison of OTR and TIAA-CREFTIAA-CREF

The only real way of comparing the The only real way of comparing the benefits received from OTR and benefits received from OTR and TIAA-CREF is by comparing the TIAA-CREF is by comparing the TIAA-CREF accumulation to the TIAA-CREF accumulation to the present value of the retirement present value of the retirement benefits a retiree expects to receive benefits a retiree expects to receive from OTR.from OTR.

Retirement Retirement Subcommittee of Subcommittee of Flexible Benefits Flexible Benefits

Committee Committee RecommendationsRecommendations Subcommittee developed two groups Subcommittee developed two groups

of recommendations:of recommendations: The subcommittee developed what we The subcommittee developed what we

believed would be a competitive believed would be a competitive retirement program for OSU.retirement program for OSU.

In addition, the subcommittee prepared In addition, the subcommittee prepared a set of recommendations that, if a set of recommendations that, if legislatively permitted, would go a long legislatively permitted, would go a long way towards eliminating the inequities way towards eliminating the inequities currently impacting OSU and OU. currently impacting OSU and OU.

The Program Being The Program Being RecommendedRecommended

Does not include OTR as a mandated programDoes not include OTR as a mandated program Current OTR participants will be given Current OTR participants will be given

opportunity to exit OTRopportunity to exit OTR For employees not participating in OTR:For employees not participating in OTR:

12% of salary is contributed towards retirement12% of salary is contributed towards retirement University will match one-to-one employee contribution University will match one-to-one employee contribution

of up to 2%of up to 2% Maximum retirement 16% (14% University, 2% Maximum retirement 16% (14% University, 2%

Individual)Individual) There will be a two-year vesting period. New There will be a two-year vesting period. New

hires employed for less than two years must hires employed for less than two years must forfeit the retirement funds that have been forfeit the retirement funds that have been contributed on their behalf.contributed on their behalf.

Note . . .Note . . .

We (OSU) will have to We (OSU) will have to BUYBUY our way out of OTRSour way out of OTRS

Converting to the proposed Converting to the proposed program will be program will be OPTIONALOPTIONAL for current participantsfor current participants

Program RecommendationProgram RecommendationIf OTR-Optional Goal Is Not If OTR-Optional Goal Is Not

MetMet Remove one year and age 26 requirements for OSU Remove one year and age 26 requirements for OSU

contributions.contributions. Move from current 7-11 contribution to flat 11%.Move from current 7-11 contribution to flat 11%.

The Board of Regents approved President The Board of Regents approved President Schmidly’s request for this action in July 2003.Schmidly’s request for this action in July 2003.

There will be a two-year vesting period. Employees There will be a two-year vesting period. Employees not completing two years of service must forfeit the not completing two years of service must forfeit the TIAA/CREF retirement funds that have been TIAA/CREF retirement funds that have been contributed in their behalf.contributed in their behalf.

Additional tax deferred annuity options including a Additional tax deferred annuity options including a 457b plan.457b plan.

Recommend a “Grandfathering” option be made Recommend a “Grandfathering” option be made availableavailable

OTR Inequities for OSU OTR Inequities for OSU & OU& OU

The legislation implemented July 1, The legislation implemented July 1, 1995 required that OSU & OU salary 1995 required that OSU & OU salary levels covered by OTR to be levels covered by OTR to be gradually uncapped.gradually uncapped.

Starting July 1, 2007, OTR will cover Starting July 1, 2007, OTR will cover the full compensation of all OSU the full compensation of all OSU faculty and A&P employees.faculty and A&P employees.

The benefit formulas of this The benefit formulas of this legislation are inequitable to OSU & legislation are inequitable to OSU & OU employees.OU employees.

Salary and Retirement Salaries for OSU and Common School Employees, Employed 1985 at $20,000, Low Base, 3% Annual Increase, Retirement July 1, 2020

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

Sal

ary

Common Retirement OSU Retirement Actual Salary OTR Cap

Annual OSU Retirement:

$26,425Annual Common Retirement: $31,531Additional Common

Retirement: $5,106

Comparison of OSU and Comparison of OSU and Common School RetirementCommon School Retirement Same for all years except between 1995 & Same for all years except between 1995 &

20062006 For low base illustration, common school For low base illustration, common school

employee with same salary stream receives employee with same salary stream receives annual retirement of $31,531 while OSU annual retirement of $31,531 while OSU employee receives $26,425, a difference of employee receives $26,425, a difference of $5,106 per year or $425 per month.$5,106 per year or $425 per month.

This illustration is for an employee whose This illustration is for an employee whose salary is always below the cap. Therefore, salary is always below the cap. Therefore, the contributions to OTR are virtually the the contributions to OTR are virtually the same as for the non-OSU employee.same as for the non-OSU employee.

Salary and Retirement Salaries for OSU and Common School Employees, Employed 1985 at $20,000, High Base, 3% Annual Increase, Retirement July 1, 2020

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

100000

1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

Sal

ary

Common Retirement OSU Retirement Actual Salary OTR Cap

Annual OSU Retirement: $29,425Annual Common Retirement: $34,531Additional Common Rretirement: $5106

Same benefits for all years except between 1995 & Same benefits for all years except between 1995 & 20062006

For high base illustration, common school For high base illustration, common school employee with same salary stream receives annual employee with same salary stream receives annual retirement of $34,531 while OSU employee retirement of $34,531 while OSU employee receives $29,425, a difference of $5,106 per year or receives $29,425, a difference of $5,106 per year or $425 per month.$425 per month.

Loss to OSU employee is same for low or high base.Loss to OSU employee is same for low or high base. This illustration is for an employee who is always This illustration is for an employee who is always

below the cap. Therefore, the contributions to OTR below the cap. Therefore, the contributions to OTR are exactly the same as for the non-OSU employee.are exactly the same as for the non-OSU employee.

Comparison of OSU and Comparison of OSU and Common School Common School

Retirement: High BaseRetirement: High Base

Salary and Retirement Salaries for OSU and Common School Employees, Employed 1985 at $40,000, Low Base, 3% Annual Increase, Retirement July 1, 2020

0

20000

40000

60000

80000

100000

120000

1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

Sal

ary

Common Retirement OSU Retirement Actual Salary OTR Cap

Annual OSU Retirement:

$44,925Annual Common Retirement: $58,062Additional Common

Retirement: $13,137

Compensation is always above the cap until Compensation is always above the cap until 2006.2006.

Retirement benefits for Common school Retirement benefits for Common school employee are $58,062 while OSU employee employee are $58,062 while OSU employee benefits are $44,925, a difference of $13,137 benefits are $44,925, a difference of $13,137 per year or $1095 per month.per year or $1095 per month.

Those with salaries over the cap in some Those with salaries over the cap in some years contribute less to OTR than uncapped years contribute less to OTR than uncapped employees. As a result, the direct employees. As a result, the direct comparison of retirement income is not comparison of retirement income is not totally accurate.totally accurate.

OSU and Common School OSU and Common School Retirement: Starting Above Retirement: Starting Above

CapCap

Recommendations for Recommendations for Eliminating the Eliminating the

InequitiesInequities Retirement subcommittee of the Retirement subcommittee of the

Flexible Benefits Compensation Flexible Benefits Compensation committee has prepared seven committee has prepared seven recommendations.recommendations.

These recommendations can only be These recommendations can only be implemented by legislative action.implemented by legislative action.

There is currently legislation in There is currently legislation in process that would solve most of the process that would solve most of the problems if enacted.problems if enacted.

Who is Impacted by The Who is Impacted by The Formula Inequities?Formula Inequities?

Any OSU or OU employee hired Any OSU or OU employee hired before XX, 1996, and who is a before XX, 1996, and who is a member of OTRS.member of OTRS.

Every OTRS member from OSU/OU Every OTRS member from OSU/OU hired after that time has their hired after that time has their retirement benefit calculated the retirement benefit calculated the same way all other OTRS members same way all other OTRS members do.do.

11stst Recommendation to Recommendation to OTRSOTRS

The comprehensive universities (OSU and OU) The comprehensive universities (OSU and OU) should not be required to have new employees should not be required to have new employees participate in OTRS, and current employees should participate in OTRS, and current employees should be given a one-time option to exit or remain in be given a one-time option to exit or remain in OTRS. New employees should have the option to OTRS. New employees should have the option to enroll in OTRS and/or a portable retirement enroll in OTRS and/or a portable retirement system, such as TIAA-CREF.system, such as TIAA-CREF.

22ndnd Recommendation to Recommendation to OTRSOTRS

Recommendation for those employees whose Recommendation for those employees whose compensation is always below the capcompensation is always below the cap

For those OTRS members from the comprehensive For those OTRS members from the comprehensive universities whose compensation is always below universities whose compensation is always below the cap, the benefit calculation formula should be the cap, the benefit calculation formula should be the same as the formula for members from the non-the same as the formula for members from the non-comprehensive universities since OTRS has already comprehensive universities since OTRS has already received payment for OTRS coverage on the received payment for OTRS coverage on the comprehensive university member’s total comprehensive university member’s total compensation.compensation.

Contribution and Benefits for OSU/OU Employee Earning $40,000 in 2001 Compared to Common

Schools and Other Higher Education

$0

$3,327$3,722

$112$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

Lifetime AmountCommon School

ContributionsExceed OSUContributions

Annual AmountCommon SchoolBenefits ExceedOSU Benefits

Lifetime AmountOther Higher

Educ.ContributionsExceed OSUContributions

Annual AmountOther Higher

EducationBenefits Exceed

OSU Benefits

CommonSchools

Other HigherEducation

Salaries Always Under the Cap

Example difference between non-comprehensive universities, common education, and comprehensive universities (OSU and OU) in lifetime contributions and annual benefits for employees whose salaries are always below the cap. The small difference in lifetime contributions is due to a quirk applicable only to FY 96 contributions. Contributions and benefits are estimated for an employee hired in 1985, retiring in 2020, earning $40,000 in 2001, and having an annual increase of 2% in compensation. (Data Source: OTRS)

33rdrd Recommendation to Recommendation to OTRSOTRS

Recommendations for Employees Whose Salaries Recommendations for Employees Whose Salaries Have Been Consistently Above the CapHave Been Consistently Above the Cap

For those employees whose regular annual For those employees whose regular annual compensation exceeds the cap in each of the fiscal years compensation exceeds the cap in each of the fiscal years 1996-2007, it is recommended that the following formula 1996-2007, it is recommended that the following formula be implemented for calculating retirement benefits:be implemented for calculating retirement benefits:

For those members who joined the system prior to July 1, For those members who joined the system prior to July 1, 1992, the average of the high three consecutive caps on 1992, the average of the high three consecutive caps on which the highest contributions to OTRS were paid which the highest contributions to OTRS were paid during fiscal years 1996-2007 times 2% times the during fiscal years 1996-2007 times 2% times the number of years of service during the capped period.number of years of service during the capped period.

For those members who joined the system after June 30, For those members who joined the system after June 30, 1992, the average of the high five consecutive caps on 1992, the average of the high five consecutive caps on which the highest contributions to OTRS were paid which the highest contributions to OTRS were paid during fiscal years 1996-2007 times 2% times the during fiscal years 1996-2007 times 2% times the number of years of service during the capped period. number of years of service during the capped period.

Contribution and Benefits for OSU/OU Employee Earning $100,000 in 2001 Compared to Common

Schools and Other Higher Education

$24,514

$15,330$17,250

$27,964

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

Lifetime AmountCommon School

ContributionsExceed OSUContributions

Annual AmountCommon SchoolBenefits Exceed

OSU Benefits

Lifetime AmountOther Higher

Educ.ContributionsExceed OSUContributions

Annual AmountOther Higher

EducationBenefits Exceed

OSU Benefits

CommonSchools

Other HigherEducation

Salaries Always Over

the Cap

Example difference between non-comprehensive universities, common education, and comprehensive universities (OSU and OU) in lifetime contributions and annual benefits for employees whose salaries are always above the cap. Contributions and benefits are estimated for an employee hired in 1985, retiring in 2020, earning $100,000 in 2001, and having an annual increase of 2% in compensation. (Data Source: OTRS)

44thth Recommendation to Recommendation to OTRSOTRSRecommendations for Employees Whose Salaries Recommendations for Employees Whose Salaries

Have Changed From Above the Cap to Below the Cap Have Changed From Above the Cap to Below the Cap During 1996-2007During 1996-2007

For those employees whose regular annual compensation For those employees whose regular annual compensation changes from above to below the cap between 1996 and changes from above to below the cap between 1996 and 2007, a change in the statutory formula is recommended. 2007, a change in the statutory formula is recommended. OTRS should specify the year that an employee becomes OTRS should specify the year that an employee becomes uncapped as the year when regular annual compensation uncapped as the year when regular annual compensation equals or remains below the cap. OTRS will then calculate equals or remains below the cap. OTRS will then calculate retirement benefits for comprehensive university retirement benefits for comprehensive university employees having regular annual compensation equal to or employees having regular annual compensation equal to or beneath the cap exactly as done for the non-beneath the cap exactly as done for the non-comprehensive universities for the period after going comprehensive universities for the period after going below the cap until retirement. For all years where an below the cap until retirement. For all years where an employee’s compensation is above the cap, the procedure employee’s compensation is above the cap, the procedure used for those employees above the cap above should be used for those employees above the cap above should be used to calculate benefits. used to calculate benefits.

Example difference between non-comprehensive universities, common education, and comprehensive universities (OSU and OU) in lifetime contributions and annual benefits for employees whose salaries start above the cap and then go below the cap. Contributions and benefits are estimated for an employee hired in 1985, retiring in 2020, earning $60,000 in 2001, and having an annual increase of 2% in compensation. (Data Source: OTRS)

55thth Recommendation to Recommendation to OTRSOTRS

Recommendation For Those Employees Who Recommendation For Those Employees Who Retired Between 1996 and the Present TimeRetired Between 1996 and the Present Time

It is recommended that OTRS recalculate benefits It is recommended that OTRS recalculate benefits for those employees of the comprehensive for those employees of the comprehensive institutions who have retired between 1996 and the institutions who have retired between 1996 and the current time using the appropriate calculation current time using the appropriate calculation procedures specified in preceding procedures specified in preceding recommendations, depending on where their recommendations, depending on where their salaries were relative to the caps. salaries were relative to the caps.

66thth Recommendation to Recommendation to OTRSOTRS

Recommendations for Employees Hired in FY96 at Recommendations for Employees Hired in FY96 at the Comprehensive Universitiesthe Comprehensive Universities

For those employees hired in FY96, the benefit calculation For those employees hired in FY96, the benefit calculation formula should be the same as it is for common education formula should be the same as it is for common education since OTRS received the same payment for OTRS since OTRS received the same payment for OTRS coverage from employees hired that year, regardless of coverage from employees hired that year, regardless of who their employers might be. who their employers might be.

For example, an employee at OSU or OU hired in FY96 For example, an employee at OSU or OU hired in FY96 with a total compensation package of $50,000 and whose with a total compensation package of $50,000 and whose five-year average compensation package climbed to five-year average compensation package climbed to $150,000 by retirement at 2030 would receive $2000 a $150,000 by retirement at 2030 would receive $2000 a year less than an employee in common education who year less than an employee in common education who contributed the exact same amount each year. contributed the exact same amount each year.

77thth Recommendation to Recommendation to OTRSOTRS

Recommendation – Buy Back and Uncapping OptionsRecommendation – Buy Back and Uncapping Options For employees whose salaries are above the caps, as For employees whose salaries are above the caps, as

specified in statute, at any time between 1996 and 2006, specified in statute, at any time between 1996 and 2006, the OTRS should institute a buyback program whereby the OTRS should institute a buyback program whereby comprehensive university employees can retroactively comprehensive university employees can retroactively make contributions and subsequently have OTRS calculate make contributions and subsequently have OTRS calculate benefits for those years as an uncapped retirement benefit benefits for those years as an uncapped retirement benefit using the same procedures as currently used for the using the same procedures as currently used for the uncapped, non-comprehensive university employees. It uncapped, non-comprehensive university employees. It would be desirable for employees to have the choice to buy would be desirable for employees to have the choice to buy back an uncapped retirement benefit and/or to request that back an uncapped retirement benefit and/or to request that their salary be uncapped immediately without buying back their salary be uncapped immediately without buying back an uncapped retirement benefit from 1996 to the present. an uncapped retirement benefit from 1996 to the present.

It is further recommended that employees who have retired It is further recommended that employees who have retired between 1996 and the present time be afforded the same between 1996 and the present time be afforded the same buy-back opportunity, with benefits recalculated to reflect buy-back opportunity, with benefits recalculated to reflect the additional contribution.the additional contribution.

Status of LegislationStatus of Legislation

A bill has been passed by House and sent A bill has been passed by House and sent to Senate.to Senate.

Bill currently includes 1Bill currently includes 1st st and 6and 6thth , but none , but none of the other recommendations.of the other recommendations.

If Bill passes Senate, it will be sent to If Bill passes Senate, it will be sent to Conference Committee where there will be Conference Committee where there will be an opportunity to include the wording for an opportunity to include the wording for the 2the 2ndnd, 3, 3rdrd, 4, 4thth, and 5, and 5thth , recommendations. , recommendations. The 7The 7thth recommendation, the buy-back, will recommendation, the buy-back, will not be included.not be included.

What if Legislation What if Legislation Passes?Passes?

New employees will not be New employees will not be permitted to participate in OTR.permitted to participate in OTR.

Current employees will have Current employees will have opportunity to exit OTR.opportunity to exit OTR.

If needed wording is included, many If needed wording is included, many retirees will receive substantially retirees will receive substantially more OTR retirement.more OTR retirement.

Who should leave OTR?Who should leave OTR?

The older you are, the better the OTR The older you are, the better the OTR benefit.benefit.

The financial stability of OTR should not The financial stability of OTR should not be questioned.be questioned.

TIAA-CREF and similar investments are TIAA-CREF and similar investments are likely to provide a greater retirement likely to provide a greater retirement when there is 25+ years until retirement.when there is 25+ years until retirement.

I would question whether anyone who is I would question whether anyone who is vested should leave OTR.vested should leave OTR.

What is given up when What is given up when exiting OTRexiting OTR

Actual Salary and Retirement Salaries for OSU Employees, Employed 1995 at $60,000, 3% Annual Increase, Retirement July 1, 2030

020000400006000080000

100000120000140000160000180000

1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029

Sal

ary

" OSU Retirement Actual Salary

Expected Changes in Expected Changes in TIAA-CREFTIAA-CREF

In very near future, this month or next, In very near future, this month or next, there will be up to nine additional there will be up to nine additional investment alternatives available within investment alternatives available within the TIAA-CREF family.the TIAA-CREF family.

Within a year the alternatives will be Within a year the alternatives will be expanded even further. There is a expanded even further. There is a possibility that you may be able to buy possibility that you may be able to buy individual stocks with your CREF funds.individual stocks with your CREF funds.

The “Flexible Benefits Committee” will The “Flexible Benefits Committee” will be considering a recommendation to be considering a recommendation to permit one or two additional vendors in permit one or two additional vendors in addition to TIAA-CREF.addition to TIAA-CREF.

Questions? Comments?Questions? Comments?

http://www.okstate.edu/osu_per/retadd.htm