Optional Retirement Program (ORP)
The Optional Retirement Program (ORP) may be chosen by certain employees in lieu of TRS based on
the job they perform. This program is a defined contribution plan governed by Internal Revenue
Code Section 403(b). Benefits are based on the performance of the investments selected and
are controlled by the employee. You are vested after one year and one day of participation with a
right to both employee and employer contributions. This program provides a greater degree of
portability than TRS.
There are significant differences between the ORP and TRS. Please see this Overview of TRS and ORP, provided by the Texas Higher Education Coordinating Board for a comprehensive review of these differences.
Click here for more details.
Teacher Retirement System (TRS)
TRS is a defined benefit retirement plan governed by Internal Revenue Code Section 401(a).
All eligible employees of The University of Texas System are automatically enrolled in TRS on their
first day of employment. Employee and employer contributions go into a large trust fund that is
managed by knowledgeable professionals. Retirement benefits are based on legislatively determined
formulas. You are vested after five years of service with a right to a retirement benefit. There are
also disability and death and survivor benefits available to TRS members.
There are significant differences between the ORP and TRS. Please see this Overview of TRS and ORP, provided by the Texas Higher Education Coordinating Board for a comprehensive review of these differences.
Click here for more details.
UTSaver Voluntary Retirement Savings Programs (DCP & TSA)
UT System offers two voluntary retirement savings programs, the UTSaver TSA (403(b)) and the UTSaver DCP (457(b)). These programs allow you to tax-defer additional income for retirement, through pre-tax contributions to invest in a fixed or variable annuity. The programs do not include an employer contribution. Participants reduce their taxable income by making pre-tax contributions from their paycheck to invest in fixed or variable annuities or mutual funds with an authorized company. As investments grow, the earnings are tax-deferred until the money is withdrawn; presumably at retirement when income tax rates are generally lower.
A variable annuity is a long-term investment product designed particularly for retirement purposes. Variable annuities contain both investment and insurance components, and have fees and charges, including mortality and expense, administrative, and advisory fees. Optional guarantee features are available for an additional charge and are based on the financial strength of the insurer. The annuity's value fluctuates with the market value of the underlying investment options and all assets accumulate tax-deferred.
Consider the investment objectives, risks, charges, and expenses of the variable annuity and its underlying investment options carefully before investing. The prospectus contains this and other information about the variable product and its underlying investment options. Please contact your Lincoln representative for a prospectus; it should be read carefully before investing or sending money.
In a 403(b) plan, distributions taken prior to age 59 ½ may be subject to an additional
10% federal tax penalty.
See the Comparison of Supplemental Retirement Savings Programs for more details. This comparison was provided courtesy of The University of Texas System.
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