Tag: finance

Don’t Wait to Create a Retirement Savings Plan

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We are committed to helping our employees prepare for a successful retirement by offering several retirement savings plan options, along with tools and resources to help you reach your goals.

Most benefit-eligible employees are enrolled in the 403(b) Base Retirement Program, which consists of a 5% employee contribution of your eligible compensation and a generous university matching contribution of 10%. That’s an immediate two-for-one match of your investment for a total contribution of 15%. While this provides a great foundation, you may want to consider additional savings options. MSU also offers two additional savings accounts: the 403(b) Supplemental Retirement Program and the 457(b) Deferred Compensation Plan. For more information about these two accounts, read Your Top Questions about MSU’s Optional Retirement Plan Options.

How to Make a Retirement Savings Plan

It’s normal to have many questions when you start to plan for your retirement:

  • How early should I start planning?
  • How much do I need to save to retire comfortably?
  • Which plan(s) should I contribute to?
  • What can I do to maximize my savings?
  • Are my retirement goals attainable?

The answers will depend on your financial situation and retirement goals. We strongly encourage all MSU employees to make an appointment with their retirement vendor – Fidelity or TIAA – to discuss their options and develop a personalized savings plan. Fidelity and TIAA are financial professionals who can provide helpful strategies, tips, and actionable steps that can help you take charge of your finances.

Additionally, both Fidelity and TIAA have numerous resources – including articles, webinars, interactive tools, and more – to help you learn about saving for retirement and other financial goals.

Don’t Wait to Save: The Power of Compounding Interest

For younger MSU employees, creating a comprehensive retirement savings plan may not be a top priority. Between student loans, rent, childcare, and more, it can be difficult to set aside money for a day 30 to 40 years in the future. But the young have a huge advantage when it comes to saving money for retirement: more time. This additional time allows them to potentially benefit the most from compounding interest, which may lead to greater savings down the road.

Compounding interest basically means allowing an investment to earn money while continually reinvesting those earnings over time. The more time you have, the smaller your original investment may need to be. In the hypothetical example below, a 25-year-old starts saving $5,000 annually ($416 per month), and a 40-year-old starts saving twice as much but waits until age 40 ($833 per month).

Compounding Interest Graph

The 25-year-old ends up contributing less money over time – $200,000 versus $250,000 – but ends up with a higher balance: $798,735 versus $566,317. In other words, the 25-year-old contributes $50,000 less but ends up with $232,000 more than the 40-year-old who waited to save. As this example shows, younger investors may benefit from saving as much as possible as soon as possible.

If your retirement date is a bit closer, you can still take advantage of compounding interest. However, you may need to increase your monthly contributions to meet your retirement savings goals. Luckily, the IRS allows people who are aged 50 years or older to contribute an additional “catch-up” amount to their retirement plans each year.

As you determine your contribution amount, please note the IRS places limits on how much employees can contribute to a retirement plan each year. To contribute a certain amount, such as $100 per paycheck, you can use the calculating tool to convert a dollar amount to a percentage.

Of course, remember that investment returns are not guaranteed and will fluctuate — in some years you may have gains, and in other years you may have losses. But over time, any investment with a net gain will benefit from compounding.

How to Change Your Contribution

While your contribution to the 403(b) Base account is fixed based on your income, you can adjust your contributions to the 403(b) Supplemental Retirement Program and/or the 457(b) Deferred Compensation Plan at any time. To do this, login to the EBS Portal with your NetID and password. Select My Benefits from the top navigation, then click on the Benefit/Retirement Enrollment and Changes tile. Select Enroll/Change my Retirement/Health Savings Account Options from the dropdown menu and click Next. On the Savings Plan screen, you’ll be able to edit your contributions to the 403(b) Supplemental and/or 457(b) Deferred Compensation accounts. Make sure you click through all the screens and hit Save to finalize the change to your contributions.

Questions? We encourage you to reach out to Fidelity (800-642-7131) or TIAA (800-732-8353) for your retirement planning questions. Visit the HR website for additional information on the retirement plans offered by MSU.

1 Please note, that the example above is a hypothetical illustration only and is not intended to represent the past or future performance of any investment. The example assumes contributions are made monthly at a 6% annual effective rate, compounded monthly, and no withdrawals. Actual performance will vary with market conditions. Investing involves risk. There is no assurance that the goals will be met or that the solution or strategy will be successful. This example was developed in partnership with TIAA.

2 Certain types of employees are excluded from participating in the 403(b) Retirement Plan. Please see the 403(b) Base Retirement Program Eligibility Chart for more details.

Job of the Week – Finance Assistant

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This week’s job of the week is a Finance Assistant (#625730) for Performing Arts Facilities and Programs. This position is seeking an individual to assist the Director of Finance with daily actions to ensure compliance with the Wharton Center policy and procedures.

The responsibilities for this role include assisting with accounting and payroll responsibilities such as temp/on-call payroll processing, sales revenue deposits, processing accounts payable and receivable, and auditing payroll transactions. Additional responsibilities of this role include organizing monthly packets, printing financial reports for supervisor review, and initiating and processing travel reimbursements and internal billings.

The ideal candidate would possess knowledge equivalent to that which normally would be acquired through a high school education; one to three years of related and progressively more responsible or expansive work experience in accounting, bookkeeping, records maintenance and/or experience in spreadsheet, word processing, and/or database software. The job may require knowledge of technical or medical terminology and/or technical training related to the field of employment; or an equivalent combination of education and experience.

For more details on the responsibilities of this position, and to view all our current postings, visit careers.msu.edu. Internal applicants should access postings through the Careers @ MSU tile in the EBS Portal.

Job of the Week – Accountant I

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This week’s job of the week is an Accountant I (#609724) for the Office of the Vice President for Auxiliary Enterprises, specifically in the Finance and Business Office. This position is seeking an individual with a strong work ethic to serve as backup to the assistant controller and be assigned as the Fiscal Officer Delegate to assist with account reconciliation for several accounts within one of the business units.

The responsibilities for this role include providing accounting controls for departmental budgets that exceed $20 million of expenses in some units, offering assistance to departmental staff with accounting concerns and monitoring the activities of the department in order to assist in the basic operational functioning. Additional responsibilities of this role include supporting the financial and operational activities of the Residential and Hospitality Services (RHS) Business and Financial Services office assigned to focus on Residence Education and Housing Services (REHS).

The ideal candidate would possess knowledge equivalent to that which normally would be acquired by completing a four-year college degree program in accounting; one to three years of related and progressively more responsible or expansive work experience in financial statement and report preparation, general ledger accounting and budgeting; or an equivalent combination of education and experience.

For more details on the responsibilities of this position, and to view all our current postings, visit careers.msu.edu. Internal applicants should access postings through the Careers @ MSU tile in the EBS Portal.

Job of the week – Senior Purchasing Agent

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This week’s job of the week is a Senior Purchasing Agent (#600044) for the Department of Purchasing. This position is seeking an individual to use extensive knowledge and expertise to execute or negotiate complex, large dollar purchases that support multiple operations, as well as to use advanced analytics to evaluate spend and activity data and determine sourcing opportunities.

The responsibilities for this role include utilizing performance measurement tools, partnering with MSU legal and risk management offices, and developing and reviewing complex RFPs, among other duties. Other responsibilities for this role include negotiating supplier contracts, managing supplier relationships and evaluates proposals. The Senior Purchasing Agent will also develop and maintain awareness of changing commodity-related business trends in the market and their impact to the university.

The ideal candidate would possess knowledge equivalent to that which normally would be acquired by a four-year college degree program in Business Administration with relevant coursework in marketing, business law, finance, public relations and computer science; five to eight years of related and progressively more responsible or expansive work experience in sales, purchasing/buying and accounting; or an equivalent combination of education and experience.

For more details on the responsibilities of this position, and to view all our current postings, visit careers.msu.edu. Internal applicants should access postings through the Careers @ MSU tile in the EBS Portal.

TIAA offers financial workshops for women to learn more about investing, saving and more!

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Looking to learn more about financial literacy? TIAA, one of MSU’s retirement vendors, is offering upcoming workshops on April 11 specifically geared towards women who are either in the early stages of their careers or mid-career. The She’s Got It: Financial Knowledge for All workshops are guided to help woman learn about investing, building actions plans and learning how to secure your future well-being. This workshop will focus on core concepts on investing, finding ways to save for life events and developing financial goals.

Why is it important to save? In life, anything can happen, and it is important to save for your future and for both expected and unexpected life events. You may not end up saving as much as you like every year, but you can start with a goal and plan from there. The workshops will go over ways to save if your single, married, in long-term relationship and saving with children and parents.

Below are some of the basics things you can learn from the workshops:

Saving and investing:

  • Setting aside an emergency fund
  • Increasing contributions from raises
  • Learn how to pay yourself first!
  • Two secrets of making your money grow

What to consider when investing?

  • Investment risk
  • Volatility
  • Asset allocation and diversification
  • Expenses

The workshops will be held on Thursday, April 11. Choose from one of the following sessions:

  • 9:00 a.m. – 10:30 a.m. OR
  • Noon – 1:30 p.m.

Both workshops will be at the MSU Student Center, Lake Huron Room, located on the third floor. For more information on this workshop or to reserve your seat, visit the TIAA website or give them a call at 800-732-8353.