403(b) Retirement Plan
Updated in January 2024
Berklee offers a 403(b) retirement plan, matching up to 6 percent. Learn more about the following:
- Contributions
- Contribution limits
- Vesting
- Investment options
- Making changes to your retirement account
- Beneficiaries
- Loans, withdrawals, and transfers
- Death or divorce
Note that there is also a Defined Benefit Pension Plan, but this applies only to those hired or rehired by the college before January 1, 2012.
403(b) Retirement Plan
The 403(b) plan is a “defined contribution” plan, like a 401(k), that provides you the opportunity to invest for the future through payroll deduction contributions. Your contributions are voluntary and are invested in accounts approved by the college and administered by Transamerica Retirement Solutions.
Berklee Basic Contributions
Hired January 1, 2012, or later: Full-time faculty* and staff, certain part-time staff
The college makes an automatic 3 percent contribution to the 403(b) plan on your behalf, even if you do not make voluntary contributions.
*Special rules apply for certain faculty who converted from part-time to full-time status between 2012 and 2016.
Berklee Matching Contributions
Berklee will match a portion of your contributions.
| Who | Hired 2011 or Earlier | Hired 2012 or Later |
|---|---|---|
| Dollar-for-dollar up to 3 percent | Dollar-for-dollar up to 6 percent |
| 50 percent of your contributions. Maximum match equals 5 percent | |
Pre-Tax versus Roth IRA Post-Tax Contributions
You may contribute using either the pre-tax or Roth IRA post-tax method. You may change your contribution method at any time.
Pre-Tax
Both your contributions and any Berklee matching contributions are sheltered from federal and Massachusetts income taxes, thereby decreasing your current income tax liability. These contributions and their associated investment earnings, if any, are generally taxed when you withdraw them. Jump to loans, withdrawals, and transfers for more information.
Roth IRA Post-Tax
Your contributions are not sheltered from federal and Massachusetts income taxes. Therefore, your contributions do not decrease your current income tax liability. However, if you make a "qualified" withdrawal, withdrawn contributions and their associated investment earnings, if any, are not taxed. Any Berklee matching contributions are treated as pre-tax contributions. Therefore, these contributions and their associated investment earnings, if any, are generally taxed when you withdraw them. Jump to loans, withdrawals, and transfers for more information.
Contribution Limits
Each year, federal law limits the dollar amount that you may contribute.
| Calendar Year | Under Age 50 | Age 50 or Older |
|---|---|---|
| 2024 | $23,000 | $30,500 |
| 2025 | $23,500 | $31,000 |
Lower limits may apply if you contribute to certain other, non-Berklee retirement plans. Consult your tax advisor or the Office of Human Resources. You are ultimately responsible for ensuring that the total of your Berklee and non-Berklee retirement contributions do not exceed legal limits.
Generally, the aggregate of your own contributions to Berklee's 403(b) plan plus your voluntary, pre-tax contributions to other employers' 403(b), 401(k), or similar plans may not exceed the maximum employee contribution outlined at the top of this page. Additional limitations may apply if you contribute to certain self-employed retirement plans such as SEP-IRAs and some Keogh or HR-10 plans.
If you contribute both to Berklee's 403(b) and any other employer-sponsored retirement plan (including self-employed plans), we strongly encourage you to seek tax advice to ensure that you comply with the IRS-mandated contribution limits. Compliance with contribution limits is your responsibility. Contact the Office of Human Resources for more information.
Vesting (Ownership of Contribution)
Vesting refers to your degree of ownership of contributions.
- Matching Contribution: You are immediately 100 percent vested in Berklee's matching contributions.
- 3 Percent Basic Contributions: You are partially vested in these contributions after two years and fully vested after six years.
- Your Contributions: You are always 100 percent vested in your own contributions.
Investment Options
You choose how contributions are invested among Berklee-approved investment options administered by Transamerica Retirement Solutions (800-755-5801).
If you participated in the plan before 2012, you may have a pre-existing account balance at TIAA-CREF (800-842-2776). Since January 2012, all new contributions have been allocated to investments options at Transamerica.
Assistance Choosing Investment Options
Contact the following for free education and information to help you make investment decisions:
- Transamerica (800-755-5801)
- One-on-one consultation with Transamerica: Schedule a personal remote appointment.
- TIAA-CREF (800-842-2776)
Enrolling and Making Changes to Investments or the Amount of Your Contributions
You may start, stop, or change the amount of your contributions at any time using either of these methods:
- Log into your account at trsretire.com. Read instructions for new users.
- Call Transamerica at the number above to speak with a customer service representative between 8:00 a.m. and 9:00 p.m. EST, Monday–Friday.
You may also change how your money is invested in the plan at any time. For assistance, contact Transamerica or TIAA-CREF.
You may transfer part or all of your account at TIAA-CREF to Transamerica at any time. For assistance, contact a Transamerica transfer specialist at 800-275-8714.
Read more about loans, withdrawals, and transfers.
Are your beneficiary designations up to date?
No one wants to think about what will happen to their retirement savings after they die. But if you don’t take a few minutes to name your beneficiaries, your loved ones could face an extra burden down the road.
Be sure to complete the 403(b) beneficiary form in directly in your retirement account through Transamerica or TIAA.
Loans, Withdrawals, and Transfers to Non-Berklee-Approved Investments
By law, the availability of withdrawals from your 403(b) account and/or transfers to investments other than those currently approved by Berklee depends on your age and Berklee employment status.
| Working Full-Time at Berklee | Working Part-Time at Berklee | Not Working at Berklee |
|---|---|---|
| Age: Under 59½ | ||
| Withdrawal: only if you have a financial hardship or take a loan | Withdrawal: only if you have a financial hardship or take a loan | Withdrawal: available |
| Transfer to non-Berklee-approved investments: not permitted per federal law | Transfer to non-Berklee approved-investments: not permitted per federal law | Transfer to non-Berklee-approved investments: available via withdrawal |
| Age: 59½–70½ | ||
| Withdrawal: available | Withdrawal: available | Withdrawal: available |
| Transfer to non-Berklee-approved investments: available via withdrawal | Transfer to non-Berklee-approved investments: available via withdrawal | Transfer to non-Berklee-approved investments: available via withdrawal |
| Age: 70½ or older | ||
| Withdrawal: available (but not required) | Withdrawal: available (but not required) | Withdrawal: required by federal law |
| Transfer to non-Berklee-approved investments: available via withdrawal; options may be limited due to minimum distribution requirements | Transfer to non-Berklee-approved investments: available via withdrawal; options may be limited due to minimum distribution requirements | Transfer to non-Berklee-approved investments: available via withdrawal; options may be limited due to minimum distribution requirements |
How to Withdraw
For assistance, contact Transamerica or TIAA-CREF.
Financial Hardship Withdrawals
Withdrawals due to financial hardship are subject to the IRS's definition of "financial hardship." The approval and payment process— excluding the time for you to prepare required documentation—may take two to three weeks. Effective February 1, 2012, hardship withdrawals will only be available from Transamerica. If you have an account at TIAA-CREF, you may be able to transfer some or all of it to fund your hardship withdrawal.
Taxes on Withdrawals
The information below summarizes current tax rules, and is not tax advice. Consult you tax advisor on these important matters.
Your Pre-Tax Contributions and All Berklee Contributions
For purposes of federal income tax, withdrawals of pre-tax contributions and their associated investment earnings, if any, are generally taxed as regular income unless they are rolled over to IRAs or other eligible retirement plans that accept rollovers. To rollover, contact both your current investment company and your rollover destination for instructions.
Roth Post-Tax Accumulations
"Qualified" withdrawals of Roth post-tax contributions and their associated investment earnings, if any, generally are not taxed. A "qualified" withdrawal generally means:
- You made your first Roth contribution at least five years before the withdrawal, and;
- The withdrawal is made after you have either reached age 59 ½, become disabled per IRS standards, or deceased.
Loans
You may borrow the lesser amount of 50 percent of your 403(b) account balance or $50,000 for any reason. However, the amount available for loan may be less, based on certain IRS-required limits. Should you be interested in a loan, contact Transamerica to discuss your options. Effective January 1, 2012, loans are available only from Transamerica. If you have a plan account at TIAA-CREF, you may be able to transfer some or all of it to Transamerica to fund your loan.
You may have only one outstanding loan with Transamerica at any time. Allow two weeks for Transamerica to process your loan request. Add another two to three weeks if you need to transfer funds from TIAA-CREF to Transamerica.
If you borrow from your 403(b) account in order to buy a home, keep in mind that your mortgage lender might include the amount of your loan in your debt-to-income ratio.
If you fail to repay your loan according to its terms, you will default. Default will trigger a tax event and may disqualify you from taking 403(b) loans in the future. If you have an outstanding 403(b) loan with Transamerica, your loan balance is payable in full when your employment ends. If you do not pay your outstanding balance, it will go into default, and a taxable amount will be reported to the IRS and you on Form 1099-R.
Death
Upon your death, your account is payable to your named beneficiary or beneficiaries. Be sure to keep your beneficiary designation up to date.
To update your beneficiary election with Transamerica, complete the Beneficiary Designation Form (Transamerica Accounts) . Use this form to elect persons as beneficiaries for your Transamerica 403(b) account.
To review or update your beneficiary election with TIAA-CREF, contact TIAA-CREF directly.
Divorce
Generally, you cannot forfeit or give away your vested benefit from the plan. Therefore, in a divorce proceeding, if you are required to transfer a portion of your benefits to your former spouse, you must obtain a special court order called a Qualified Domestic Relations Order (QDRO).
As soon as you expect that you might need a QDRO, you and your attorney should contact Transamerica Retirement Solutions (800-755-5801) and/or TIAA-CREF (800-842-2776) to begin the QDRO drafting and review process. By law, Transamerica will administer a QDRO only if it agrees with the plan’s provisions.