Help is Available for Retirement Planning Across All Career Stages
More than 50 faculty joined representatives from Duke Human Resources and Fidelity Investments for a workshop on how to begin or continue the process of financial planning for retirement.
Sara Howe, senior retirement benefits administration and communications analyst with Duke Benefits, teamed up with Yvette Mills, workplace financial consultant with Fidelity, to give faculty members a better understanding of how the Duke Faculty and Staff Retirement Plan works and how they can maximize their potential for retirement savings.
One overarching message is that faculty have numerous resources available to them for planning for the future, including recommended one-on-one meetings with dedicated Fidelity staff such as Mills.
A wealth of information about retiring from Duke is available at hr.duke.edu/retirement. Participants can access their Fidelity accounts by logging into Duke@Work, going to the MyInfo tab and finding the My Benefits heading, then selecting Access my Fidelity account. Alternatively, they can log in at netbenefits.com/duke.
Here are brief excerpts from the discussion.
One of the key questions is, where will your money come from when you retire? Financial experts say that you will need between 80 to 90% of your pre-retirement income. Your income during retirement typically comes from three primary sources: government-provided Social Security income; money that you have accumulated through personal savings; and money that has been set aside through employer-sponsored retirement plans. –Sara Howe
The Duke Faculty and Staff Retirement Plan is a 403b retirement plan available to all Duke faculty and staff employees for voluntary savings toward retirement. You can participate with your voluntary contributions from your paycheck, and you can enroll at any time through Duke@Work. –Sara Howe
I want to emphasize that with the two tax-advantaged ways to save in the 403b retirement plan, we as Fidelity consultants can help with the key considerations for your situation. With the pre-tax option, you start with the gross pay and you take out the contributions. It’s not yet taxed, so it’s pre-tax, then it’s taxed at distribution. And with the Roth option, the tax is taken out first. Then the contributions, which are after-tax, and the earnings grow tax-free. At retirement, the distribution from the Roth 403b is tax-free and penalty-free — providing it’s qualified. To be a qualified distribution, it means the five-year aging requirement has been satisfied, and one of the following conditions is also met: at least age 59 and a half; disability; or in case of death. –Yvette Mills
Duke’s contribution formula is determined each year and published on our website at hr.duke.edu/dukecontribution. Eligible employees are not required to make voluntary contributions to the plan in order to receive the Duke contribution. However, they are encouraged to participate in the plan with at least 3% of salary. –Sara Howe
With the Duke 403b plan, investments are grouped by tier. Tier 1 are target date funds and offer a way to make a single choice based on your expected years to retirement. It’s like ‘set it and forget it.’ Tier 2 represents the primary asset classes that allow you to build your own diversified portfolio. And we have the option of Tier 3 in the self-directed brokerage account, which gives you access to over 11,000 mutual funds and investment choices. Additional fees may apply to Tier 3. –Sara Howe
We receive a lot of questions regarding investments. To address these questions, we want to look at how much you will need in retirement in terms of your particular expense need. We also want to look at diversification. If your portfolio is diversified, that means you’re going to move with the market, and we want to make sure you are in the most efficient position to do so. We also want to look at asset allocation, because that’s going to determine how risky the portfolio is and how committed you’re going to be to maintaining the course. We want to look at time horizon. Do you have 10 years or five years or two years until your retirement? What’s your tolerance for risk? How do you feel when there is a large amount of volatility in the market? What’s your tax situation? What are the things for you to consider to make sure you have tax diversification and a certain amount of pre-tax and Roth options? These are some of the key considerations that we look at. –Yvette Mills
There is no cost to meet with us. We generally recommend at least once a year to have a meeting, but there’s no limit. We can do in-person meetings in our office in Erwin Square, or phone calls, Zoom sessions or by e-mail. –Yvette Mills
Next Steps
Recommended follow-up steps for participants (or any faculty member) include reviewing personal retirement information, scheduling a meeting with a Fidelity representative, reviewing retirement investment choices and considering increasing the contribution amount.
While Fidelity is the primary recordkeeper for the retirement plans at Duke, and through that arrangement offers a broad range of complimentary retirement planning and financial advisory services to all faculty and staff, employees are welcome to use other independent companies and advisors for their financial planning and/or management.
Questions
Faculty with questions can contact Duke Benefits via benefits@duke.edu or 919-684-5600. To schedule an appointment with one of the three Fidelity representatives (Yvette Mills, Alan Collins and Cleo Morgan) who are dedicated to the Duke Faculty and Staff Retirement Plan, faculty can go to fidelity.com/schedule, call 800-343-0860 or text MeetAtDuke to 343898.
Resources
A Box folder contains the following resources:
- Slides from the presentation
- Detailed contact information
- Nuts and bolts of medical coverage FAQ
- Faculty retirement checklist
- Duke retirement planning guide
Main image: Sara Howe and Yvette Mills