Below are the important features about the Plan. This website is intended to be a summary of the plan provisions. In the event that a conflict exists between the information contained within this website and the plan document, the plan document provisions prevail. For more information, please contact your local Financial Professional.
Contributions
When you choose Voya Financial® for your Optional Retirement Program (ORP), you and your employer each contribute a certain percentage of your total compensation (the percentage determined by Texas state law) to either:
- 403(b)(1) Variable Annuity Contract issued by Voya Retirement Insurance and Annuity Company (“VRIAC”); or
- 403(b)(7) Custodial Account, which offers mutual funds.
The contributions are made on a pre-tax basis -- your salary is "reduced" by the amount of your contribution, and you are not taxed on those contributions or the earnings until the money is distributed. Your contributions and your employer's contributions are invested according to your investment selection.
Both the ORP 403(b)(1) variable annuity contract and the ORP 403(b)(7) custodial account offering mutual funds provide for:
- Asset building - A way to invest for future financial needs and potentially supplement your retirement income.
- Tax-deferred investing - Under the Internal Revenue Code (IRC), with this program your contributions and any earnings on those contributions are taxed only when you begin to take distributions, at which time you may be in a lower tax bracket. Taxes are generally due upon withdrawal of tax-deferred assets and early withdrawal penalties will apply to withdrawals taken prior to age 59 1/2, unless an IRS exception applies.
- Diversified investment options - You have the opportunity to select where your contributions are allocated.
- Portability of your account - If you terminate employment in all Texas public institutions participating in the ORP, you can take your vested account balance with you.
- Unlimited transfers between variable investment options via Internet, phone or paper within either the 403(b)(1) variable annuity or the 403(b)(7) custodial account, subject to Voya®’s Excessive Trading Policy.
In addition, the 403(b)(1) variable annuity contract provides:
- Periodic annuity payments for the future - Under the annuity provisions, you choose the payout option that best fits your future needs.
- No surrender/withdrawal charges (fund management fees and fund operating expenses apply and a mortality and expense (M&E) risk charge may apply). Fees depend on the investment option chosen. Please refer to the Contract Prospectus Summary for individual fund fee information.
Under the Plan, the maximum annual contribution amount is set by Internal Revenue Service (IRS) guidelines on a yearly basis. You may view the current limits here.
Withdrawals
Under the provisions of Texas law, you may not withdraw funds from the ORP except upon the earlier of your termination of participation or attainment of age 72. You terminate participation by death, retirement (including disability retirement), or termination of employment in all Texas public institutions of higher education participating in the ORP. If you are eligible to take a distribution, you may also be subject to an IRS 10% premature distribution penalty tax.
If you have terminated participation or attained age 72 and wish to withdraw funds (including taking out a loan), you must provide us with a letter from your employer confirming your termination and/or vesting status.
Distribution Options
Voya provides a wide variety of payout options (subject to your plan provisions) when you retire, including:
- Full or partial withdrawal (may be subject to federal withholding and possible tax penalties).
- Systematic payout options including Estate Conservation Option, Systematic Withdrawal Option and Life Expectancy Option.
- Payments guaranteed for your lifetime or for a specified period.*
- Rollover to an IRA, or another eligible retirement plan.
Guarantees are based on the claims-paying ability of Voya Retirement Insurance and Annuity Company. Guarantees do not apply to the investment return or principal value of the separate account. A 1.25% M&E applies to payments made on a variable basis during annuitization.
If you die before you retire, your beneficiary may elect to receive the value of your account or select one of several settlement options, subject to IRS minimum distribution rules. For the 403(b)(1) annuity contract only, a guaranteed death benefit is available. If the beneficiary requests a lump sum payment or an annuity payout option within six months of the participant's death, the death benefit is guaranteed to be greater of:
a) the account value, or
b) total contributions made to your account minus any withdrawals or annuitizations. Guarantee based on the claims paying ability of VRIAC.
ORP 403(b)(7) custodial account which offers mutual funds: There are no systematic payouts, guaranteed lifetime or guaranteed specified period payment options available. When you retire, you may:
- Request a full or partial withdrawal (may be subject to federal withholding and possible tax penalties).
- Utilize the funds to purchase a single premium immediate annuity.
- Rollover to an IRA or another eligible retirement plan.
Voya does not offer tax advice. Please consult a tax advisor or attorney before making a tax-related investment/insurance decision.
You should consider the investment objectives, risks, and charges and expenses of the variable product and its underlying fund options; or mutual funds offered through a retirement plan, carefully before investing. The prospectuses/prospectus summaries/information booklets contain this and other information, which can be obtained by contacting your local Financial Professional. Please read the information carefully before investing.