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Retirement Planning (Section 406)

For a detailed description of Smith College's retirement plan, please refer to our Summary Plan Description.

The college's Retirement Plan provides a significant contribution to income replacement for employees upon retirement. The college pays approximately 9% of your annual salary to your retirement account(s). The Retirement Plan is fully funded by the college and you are not required to make any matching contribution. The college's contributions to your retirement plan are fully vested beginning with the first premium payment.

The college sends your retirement contributions to accounts which have been established in your name with insurance and mutual fund companies with whom the college contracts.

The Retirement Plan is structured so that, after a 30-year career at the college, you can expect to receive approximately 67% of your final year's salary in retirement income from a combination of Social Security and Retirement Plan benefits. While the college cannot guarantee that you will meet this objective, you have the opportunity to make investment decisions that fit your particular goals.

Tax-Deferred Salary Plan

The Internal Revenue Service (IRS) allows employees of colleges, universities, and certain other nonprofit organizations to allocate a portion of salary on a federal tax-deferred basis to retirement accounts.

Eligibility: If you are employed in a regular or limited-term position of half-time or more, you are eligible to participate in the Tax-Deferred Salary Plan.

Enrollment: Contact the Office of Human Resources if you wish to begin saving a portion of your salary for retirement purposes. The IRS sets annual limits on how much you may defer; these limits are determined by: (1) your years of service, (2) your current annual salary, (3) the amount of salary you tax-deferred in previous years, and (4) college contributions to your Retirement Plan accounts.

Investment Options: You may establish one or more tax-deferred accounts with the four Retirement Plan companies. The Office of Human Resources has a list of these companies from which you may choose.

Withdrawal of Funds: You may withdraw funds from your tax-deferred salary account(s) under certain conditions including termination of employment, disability, or significant financial hardship. Any amount withdrawn will be subject to federal tax and an early withdrawal penalty.

Health Insurance for Early Retirees

Employees who retire from Smith College between the ages of 62 and –65, and who have a minimum of 10 years of consecutive service in a regular position at Smith College immediately prior to retirement, may continue to participate in the college's group health plan until age 65, with the college paying half its normal benefit. Please refer to the plan description for the Health Care Program, which can be obtained from the Office of Human Resources, for further details.

For other retiring employees, Medicare Part A (hospital insurance) and Part B (medical insurance) are available beginning at age 65. Enrollment in Part A is automatic when you reach age 65.

Pre-Retirement Counseling

The college sponsors educational programs to help you acquire the knowledge you need to make appropriate Retirement Plan investment decisions and to plan for your retirement. The Office of Human Resources will publicize all on-campus retirement planning seminars.