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Eligible employees with a pension benefit under their core retirement plan (either the DB Plan or the Hybrid Plan), or rehired employees in the DC Plan with a deferred vested pension benefit will have an opportunity to transfer the lump sum value of their pension benefit to the DC Plan during a one-time election window in 2026. Employee participation in the DC Opt-In Program is voluntary.

If an eligible employee chooses to participate in this program, the value of their pension will be converted to a lump sum and transferred to the DC Plan. Going forward, future retirement benefits will be earned under the DC Plan.
The DC Plan Opt-In Program does not make any changes to the DB Plan or the Hybrid Plan. No action is necessary for eligible employees who prefer to remain in their current core retirement plan or for eligible DC Plan participants who wish to retain their deferred vested pension benefit separate from their current DC Plan benefits.

The university's pension plan (the Retirement, Disability and Death Benefit Plan (the ¡°RDD Plan¡±), referred to as the DB Plan or as the DB component of the Hybrid Plan)) is in good financial health. Members who remain in the DB Plan or the Hybrid Plan can count on receiving the benefits they¡¯ve earned.

Eligible employees will receive more information regarding their options and how the voluntary DC Opt-In Program works, including a personalized statement showing the lump sum value of their pension benefit and comparing the growth of their retirement benefit under the DB Plan or Hybrid Plan with the potential growth of the lump sum value of their pension benefit if that amount were transferred to the DC Plan.

• June 2025: Program approved by the Board of Curators
• October 2025: Program announcement flyer mailed to home address of eligible employees
• December 2025: Eligible employees receive personalized statements to their mailing address outlining benefits and options
• December 2025 ¨C April 2026: Education sessions (webinars, one-on-one, Fidelity support, etc.)
• January 30, 2026: Deadline to request an election packet*
• February 9, 2026 ¨C April 10, 2026: Election window
• By September 1, 2026: The pension benefit of participating employees is converted to a lump sum amount and that amount is transferred to a tax deferred account in the DC Plan, accessible to the participating employees through Fidelity

*Election packets will only be mailed to eligible employees who are interested in the program and request to receive a packet. Requesting a packet does not lock eligible employees into a decision, they will have until the end of the election window to decide if they want to participate by completing and submitting an election packet.

Employees have frequently requested the ability to transfer their pension benefit to a defined contribution plan over the last several years with the implementation of the Hybrid Plan in 2012 and the DC Plan in 2019. Following the successful implementation of the lump sum distribution window for former employees with pension benefits in 2024, the University recognized current employees may prefer to earn their retirement benefits under a defined contribution plan instead of a defined benefit plan and developed the voluntary DC Opt-In Program.

The DC Opt-In Program is not a voluntary early retirement incentive program (VERIP). The DC Opt-In Program is designed for those who intend to continue University employment but prefer to earn their retirement benefits entirely under a defined contribution plan. The DC Opt-In Program converts the employee¡¯s pension benefit to a lump sum and transfers the amount of the lump sum to the DC Plan.

Participating in the Defined Contribution Opt-In Program will not change your access to retiree health insurance. If you choose to participate in the Defined Contribution Opt-In Program, you will have access to retiree health insurance that is available at the time you separate from the University on the same terms as if you had remained in your current retirement plan for as long as the University continues to offer retiree health insurance.

The DC Opt-In Program will not adversely affect the RDD Plan¡¯s financial position. The RDD Plan is in good financial health and members who remain in the RDD Plan (employees participating in the DB Plan or the Hybrid Plan) can count on receiving the benefits they¡¯ve earned under the RDD Plan. The DC Opt-In Program will not have an impact on the benefit levels for retirees currently receiving benefits from the DB Plan or Hybrid Plan or those who choose to remain in the DB Plan or Hybrid Plan.

The University is committed to the sound fiscal management of the RDD Plan and contributes millions of dollars each year to ensure the financial health of the RDD Plan.

Optional programs like the DC Opt-In Program are a common practice for defined benefits plans and will marginally improve the RDD Plan¡¯s funded status and reduce its liabilities. The DC Opt-In Program benefits the University by reducing the number of RDD Plan members and reducing financial risk faced by the University by decreasing the RDD Plan¡¯s liabilities.

Employees eligible to participate in the DC Opt-In Program will be those who, as of September 1, 2026, are:

• Active benefit-eligible employees who are:
  • Vested in the DB Plan or DB component of the Hybrid Plan, and
  • Not eligible for normal retirement (age 65 with at least 5 years of service or age 62 with at least 25 years of service).
• Active benefit-eligible employees who:
  • Were rehired on or after October 1, 2019, and as of September 1, 2026, have a deferred vested pension benefit under the DB Plan or Hybrid Plan that they have not yet started to receive. These employees will only have the option to transfer the lump sum value of their pension benefit to the DC Plan.

Employees not eligible to participate in the DC Opt-In Program include those who, as of September 1, 2026, are:

• Active benefit-eligible employees participating in the DB Plan or the Hybrid Plan who:
  • Are eligible for normal retirement (age 65 with at least 5 years of service or age 62 with at least 25 years of service), or
  • Were hired or rehired on or after October 1, 2019 (unless they have a deferred vested pension benefit under the DB Plan or the Hybrid Plan).
• Active employees in a non-benefit eligible position who have a frozen pension benefit under the DB Plan or DB component of the Hybrid plan.
• Terminated employees:
  • Including those with a deferred vested benefit who have not been rehired, or
  • Those who have been rehired but did not earn a vested benefit under the DB Plan or the DB component of the Hybrid Plan.
• Employees with an approved Division of Benefits Order (DBO) on file with the University.
   

If you choose not to participate, there are no changes to your current core retirement plan. If you prefer to remain in your current core retirement plan or if you are an eligible rehired DC Plan participant who wishes to retain your deferred vested pension benefit, no action is required on your part and nothing will change for you.

If you elect to participate in the Defined Contribution Opt-In Program:

• Active DB Plan or Hybrid Plan members: your core retirement plan will switch from the DB Plan or the Hybrid Plan to the DC Plan.* You will not lose the value of the pension benefits you have earned so far ¨C the lump sum value of your pension benefit as of September 1, 2026, will transfer to the DC Plan, your new core retirement plan.
• Eligible rehired DC Plan members: the lump sum value as of September 1, 2026 of your deferred vested pension benefit will transfer to your current core retirement plan. You will retain the same benefit plan design for the DC Plan.

*To comply with IRS regulations, individuals in the DB Plan or Hybrid Plan who participate in the program will have a 2% minimum required employee contribution under the DC Plan. This contribution will be into their 457(b) Plan. Participants also qualify for a 100% match from the university up to 8%.

*You can change the voluntary portion of your employee contributions to the Defined Contribution Plan, but you must contribute at least 6% to the 457(b) Plan in addition to your mandatory 2% in order to receive the benefit of the full 8% matching contribution from the University.

Follow these steps to access your personalized statement online: 

• Log into *
• Click on ¡°View Your Plan Details¡±
• Select the ¡°Benefit Details¡± link at the top of the page
• Select the ¡°Personalized Communications¡± link on the left 

*If it¡¯s your first time, you¡¯ll need to create an account. If you need assistance creating an account, call the Milliman Benefits Service Center at 1-833-551-0021. Representatives are available Monday-Friday, 7:00 AM - 7:00 PM CT.

Review the decision guide relevant to your retirement plan to help you think through your personal situation to determine if the DC Opt-In Program is right for you. 

If you are unsure of your current retirement plan, refer to the first page of your personalized statement or call the Milliman Benefits Service Center at 1-833-551-0021. Representatives are available Monday-Friday, 7:00 AM - 7:00 PM CT. 

• Defined Benefit Decision Guide (PDF): For current Defined Benefit participants
• Hybrid Decision Guide (PDF): For current Hybrid Plan participants
• Deferred Vested Pension Decision Guide (PDF): For participants rehired after 10/01/19 with a deferred vested pension benefit

If you are interested in the Defined Contribution Opt-In Program, you have until January 30, 2026, to request an election packet. There are three ways to request a packet: 

1. Call the Milliman Benefits Service Center at 1-833-551-0021 and request a Defined Contribution Opt-In Program election packet.
   • Representatives are available Monday-Friday, 7:00 AM - 7:00 PM CT.
2. Return the packet request form included in your personalized statement.
3. Access your packet by logging into the *:
   • Click on ¡°View Your Plan Details¡±
   • Go to the ¡°DC Opt-In Program Information¡± tile
   • Click on the ¡°Make election¡± button
   • Click on the ¡°Choose¡± button on the next screen 

*If it¡¯s your first time, you¡¯ll need to create an account. If you need assistance creating an account, call the Milliman Benefits Service Center at (833) 551-0021 for assistance.

In partnership with Fidelity and Milliman, the University has created a webinar series to help you learn more about retirement planning and the DC Opt-In Program.

Understanding the University's Retirement Plans

Presented by the 51Ç鱨վ Office of Human Resources; recording will be posted mid-January

How to Read Your Personalized Statement

Presented by Milliman; recording will be posted mid-January

Fundamentals of Retirement Income Planning

Presented by Fidelity; on-demand version available in January

How you plan for retirement is personal. Understanding your benefits and thinking about your plan for retirement is well worth your time. Here are ways you can get started:

• Learn about your current retirement plan. It¡¯s important to know what your current retirement benefits are and to think about how those benefits fit into your plan for retirement, when considering whether you are interested in exploring the Defined Contribution Plan Opt-In Program.
• Gather all your retirement resources ¨C not only from the university. Go to the website to download your Social Security statement. Make a list of retirement benefits you have from previous employers and/or your spouse¡¯s retirement benefits, as well as your other savings.
• Look at your plan for retirement. Do you have a plan for when you want to retire and how to get there? Are you on track? Schedule a free one-on-one consultation with Fidelity Workplace Financial Consultant or make time to check in with your own financial advisor.
• Check out the UM System retirement planning checklist for more information.
• Consult (exit UM System site).