Investment Options

Carnegie Mellon employees are responsible for investing their university and supplemental retirement contributions.

• Upon your hire, your university contributions will automatically be invested in an age-appropriate TIAA-CREF LifeCycle fund. (This default enrollment is based on an anticipated retirement age of 65.)
• Upon completion of the appropriate carrier enrollment forms, your retirement account contributions will be invested in the TIAA-CREF and/or Vanguard investment fund options of your choice.
• Be sure to complete your retirement applications to ensure that your funds are deposited into the investment funds that best meet your retirement goals.
• You may contribute:
  
  • a minimum of $25 a month ($12.50 per biweekly pay);
  • a maximum of $17,000 in 2012;
  • those age 50+ can contribute up to $5,500 additional;
  • deferral cannot exceed your salary;
  • contact TIAA-CREF to determine your personal limit.

Investment Account Options

Traditional vs. Roth 403(b) Contributions

• In a traditional 403(b) plan, you build your retirement saving with pre-tax dollars to reduce the amount you pay in taxes now, but you will pay taxes on your contributions and their earnings when you withdraw the funds at retirement.
• In a Roth 403(b) plan, you make SRA contributions with after-tax dollars, so you'll pay more in taxes now. Your contributions and their earnings will be completely tax free in retirement, however.

There are advantages and disadvantages to both kinds of accounts, and your individual circumstances impact which is the right choice for you. You may contribute to one or both kinds of accounts.

• See the Roth 403(b) Brochure [.pdf] for detailed information about the factors that make each kind of account right for different people.
• Retirement Investment Examples [pdf] illustrate the kinds of tax savings and earnings growth you can achieve under both types of plans.