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University 403(b) Plan

The University of Illinois System is committed to providing a best in class Supplemental 403(b) Plan to help support your financial wellbeing and to help you prepare for your retirement goals. The University 403(b) Plan is an optional investment plan available to all employees receiving compensation from the University. Participants may choose to invest pre-tax and/or Roth (after-tax) money with Fidelity Investments and/or TIAA. Participating in the 403(b) Plan can help supplement retirement planning, and will not reduce any other University benefits.

See the 403(b) Universal Availability Notice.


You are eligible to participate in the 403(b) Plan if you are receiving compensation from the University and are able to contribute at least $200 annually. You do not need to be eligible for State insurance or other benefits to participate.

Participation can be started or stopped at any time, subject to payroll schedules.

Contribution Limits

If you contributed, in any calendar/tax year, to a retirement plan through another employer, it is your responsibility to monitor your total contributions to all plans to ensure that you do not contribute over the IRS maximum allowed each year.

The minimum amount that you may contribute to the 403(b) Plan is $200 per year. The maximum amount you may contribute is determined by the IRS:

  • For calendar year 2023, the maximum is $22,500.
  • For calendar year 2024, the maximum is $23,000.

If you are 50 or more years old at the end of the calendar year, you may also be eligible for an additional “catch-up” contribution of up to $7,500 in 2023 and 2024.

If you need help determining your maximum contribution limit, contact University Payroll & Benefits.

There is no employer contribution in this plan.

Plan Summary

See the 403(b) Universal Availability Notice or 403(b) Plan Document for full details.

Participation in the 403(b) Plan is voluntary, and does not reduce any of your other University benefits based on salary – such as SURS retirement, long-term disability, life insurance, or survivor benefits. You may start or stop contributing at any time, and you are always fully vested in your contributions.

Investment Companies & Fund Options

The fund menu provides access to a diverse array of asset classes in line with the 403(b) Plan’s Investment Policy Statement .

You may choose to invest with TIAA and/or Fidelity Investments. Each investment company offers a range of available funds, frequent on-campus one-on-one counseling sessions, and additional educational resources for saving and investing.

You can learn more about the available funds on the TIAA website or the Fidelity websites. Or, attend a one-on-one counseling session with advisors from either company.

Plan Fees

The Plan has a core lineup of funds in low-cost share classes, as well as low plan recordkeeping fees with transparency to ensure that all participants share in the cost of the Plan administration.

It’s important to consider any fees when making decisions about your retirement account. Below is a description of the types of fees.

  • Record Keeping and Plan Administrative Fees – These fees cover the vendor’s cost to record keep the Plan and the Plan’s administrative costs, legal and consulting fees. Fees are assessed on a quarterly basis.
    • TIAA Total Fee – 0.034% which is approximately $34 annually when investing $100,000
    • Fidelity Total Fee – 0.0425% which is approximately $42.50 annually when investing $100,000
  • Investment Management Fees – Each investment includes an investment management fee (shown as the gross expense ratio). This fee covers individual fund operating expenses and is expressed as a percentage of assets. See the expense ratio for each investment at Fidelity and TIAA.

403(b) Income in Retirement

Retirement withdrawals from pre-tax contributions and earnings are subject to federal income tax. The State of Illinois does not tax retirement income from the 403(b) Plan if taken in accordance with plan provisions, at full retirement age, as a legal resident of Illinois.

Retirement withdrawals from Roth (after-tax) contributions and earnings are not subject to federal or state income taxes as long as they are part of a qualified distribution. A qualified distribution is generally one that is made five years after the year of the first Roth contribution and the participant attained age 59½, has a severance from employment, dies, or becomes disabled.

Withdrawals taken prior to retirement or not meeting the criteria for a qualified distribution may be subject to additional taxes or penalties. Questions about taxation of retirement income should be discussed with a tax professional.

Loan & Hardship Withdrawals

If you participate in the 403(b) Plan, you may be eligible to take a loan or hardship withdrawal from your plan account. Before considering a withdrawal from your retirement plan it is important for you to consult a financial professional and consider other ways to access cash that could be more beneficial to your long- and short-term financial goals. Options are available through the University of Illinois Community Credit Union or other financial institutions.

  • Loans – Retirement plan loans allow you to borrow from the balance you’ve built up in your retirement account. Loan amounts must be paid back in full. You will pay taxes on any amount not repaid and an early withdrawal penalty may apply. Refer to the Loan & Hardship Withdrawals page for more details.
  • Hardship withdrawals – The 403(b) Plan allows hardship distributions to be taken when IRS requirements are met. These withdrawals are allowed only in situations that are both: (1) due to an immediate and heavy financial need of the Participant and (2) limited to the amount necessary to satisfy the immediate and heavy financial need. Hardship distributions are not paid back, but they are taxable and penalties may apply. Refer to the Loan & Hardship Withdrawals page for more details.

Deductions & Contributions

For questions about the 403(b) Plan in general, or about payroll deductions and contributions, contact University Payroll & Benefits.

Funds & Accounts

For questions about funds or your account, contact the appropriate vendor directly:

Information provided on this site is general in nature about matters of interest to University of Illinois System employees. This information is not legal, financial, or tax advice. You should consult with a legal, financial, or tax professional for assistance with your individual circumstances.