ORP Plan Overview
Below are the important features about your 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 representative.
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.
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 70½. 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 70½ 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.
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 representative. Please read the information carefully before investing.
Variable annuities and mutual funds under a retirement plan are long-term investments designed for retirement purposes. If withdrawals are taken prior to age 59 ½, an IRS 10% premature distribution penalty tax will apply, unless an IRS exception applies. Money taken from the plan will be taxed as ordinary income in the year the money is distributed. Account values fluctuate with market conditions, and when surrendered the principal may be worth more or less than its original amount invested. An annuity does not provide any additional tax deferral benefit, as tax deferral is provided by the plan. Annuities may be subject to additional fees and expenses to which other tax-qualified funding vehicles may not be subject. However, an annuity does provide other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.
For 403(b)(1) fixed or variable annuities, employee deferrals (including earnings) may generally be distributed only upon your: attainment of age 59½, severance from employment, death, disability, or hardship. Note: Hardship withdrawals are limited to employee deferrals made after 12/31/88. Exceptions to the distribution rules: No Internal Revenue Code withdrawal restrictions apply to '88 cash value (employee deferrals (including earnings) as of 12/31/88) and employer contributions (including earnings). However, employer contributions made to an annuity contract issued after December 31, 2008 may not be paid or made available before a distributable event occurs. Such amounts may be distributed to a participant or if applicable, the beneficiary: upon the participant's severance from employment or upon the occurrence of an event, such as after a fixed number of years, the attainment of a stated age, or disability.
For 403(b)(7) custodial accounts, employee deferrals and employer contributions (including earnings) may only be distributed upon your: attainment of age 59½, severance from employment, death, disability, or hardship. Note: hardship withdrawals are limited to: employee deferrals and '88 cash value (earnings on employee deferrals and employer contributions (including earnings) as of 12/31/88).
Insurance products, annuities and retirement plan funding issued by (third party administrative services may also be provided by) Voya Retirement Insurance and Annuity Company, One Orange Way, Windsor, CT 06095-4774. Securities are distributed by Voya Financial Partners LLC (member SIPC). Custodial account agreements or trust agreements are provided by Voya Institutional Trust Company. All companies are members of the Voya ® family of companies. Securities may also be distributed through other broker-dealers with which Voya has selling agreements. Insurance obligations are the responsibility of each individual company. Products and services may not be available in all states.