Retirement Benefit Frequently Asked Questions

August 14, 2020

Dear Faculty and Staff:

As we announced on Aug. 10, due to the financial impact of GW’s updated fall plans and to continue to protect our core academic mission, university leadership made the difficult decision to temporarily suspend university base and matching contributions to the 401(a) Retirement Plan for Faculty and Staff (the 401(a) Plan) beginning in October.

I would like to underscore that this suspension is temporary, and university leadership plans to reevaluate this measure in December when we assess our financial situation following the conclusion of the fall semester. We will provide another update at that time about the future status of these contributions.

Additionally, the temporary suspension of the university’s contributions to the 401(a) plan does not affect your ability to continue personal contributions to your 403(b) Supplemental Plan account. Any contributions you are currently making, or contributions you elect to make in the future, will continue to be directed to your 403(b) account without interruption.

Below, GW Benefits has provided answers to additional questions you may have related to this temporary suspension. GW Benefits staff is also available to assist you by phone or email with any other questions related to your benefits.

Sincerely,

 
Mark Diaz
Executive Vice President and Chief Financial Officer
 

 
Questions and Answers Regarding Suspension of the GW 401(a) Base and Matching Contributions

Effective October 2020

Summary of Changes
  • Beginning October 2020, GW contributions to The George Washington University 401(a) Retirement Plan for Faculty and Staff (Base and Matching) will be suspended for GW employees eligible to participate in that Plan. Contributions will not be retroactively made up at a later date.
  • Faculty and Staff contributions to The George Washington University 403(b) Supplemental Plan (the “403(b) Plan”) will continue to be deducted from participants’ paychecks. Please remember, you can make changes to your contribution to the 403(b) at any time. If you would like to make a change, please visit Fidelity NetBenefits, or call Fidelity at (800) 343-0860 (including those invested at TIAA). You can enroll, change your payroll contribution percent or change your investment provider at any time.
     
Questions and Answers

1. Who will be impacted by this suspension?
All employees (monthly and biweekly paid) who are eligible to receive GW’s contribution to The George Washington University 401(a) Retirement Plan for Faculty and Staff (the “401(a) Plan”), including employees on paid leave, are impacted by this suspension period.

2. When is GW suspending the GW contribution?
GW will temporarily suspend contributions to the 401(a) Plan beginning October 2020. This is a temporary suspension and will be reevaluated in December following the conclusion of the fall semester.

3. What happens to the money that GW has already contributed to my 401(a) Plan account?
The money in your 401(a) Plan account is fully vested. Your account will continue to be invested based on your current investment election(s) and credited with gains and losses. You will continue to be able update your investment elections within the plan. In addition, your account will continue to be subject to the current distribution rules.

4. Do I need to take any action regarding the suspension of GW’s contribution when it occurs or when it resumes?
No action is required by you. The GW contribution to your 401(a) Plan account will automatically cease and will automatically resume based on your elections in effect at the time once the suspension has ended.

5. Will my contributions to my 403(b) Plan account be suspended once GW suspends its contribution to my 401(a) Plan account?
No. Your contributions to your 403(b) Plan account (if any) will not be affected by the suspension of the GW contribution to your (401(a) Plan account.

6. Can I enroll in the 403(b) Plan or continue to make changes to my contributions during this suspension?
Yes. You may enroll for the first time or make changes to your contribution elections, payroll contribution percent, investment provider and investment fund elections, at any time. You may do so through Fidelity NetBenefits or by calling Fidelity at (800) 343-0860 (including those invested at TIAA). 

7. Can I make additional contributions to make up for contributions not received from GW?
Yes. You can elect any percentage of your pay to contribute to the 403(b) Plan, although the IRS limits how much can be contributed to a 403(b) Plan during the calendar year. The IRS deferral limits for 2020 are as follows:
 

403(b) Elective Salary Deferral Limit 

$19,500

This is the basic retirement plan deferral limit for each employee.

Additional Age 50 Catch-Up Limit

$6,500

Employees age 50 and over (including those turning age 50 in 2020) can contribute this additional amount to their 403(b) retirement account.

8. Will I continue to accrue service time for eligibility purposes?
Yes. You will continue to accrue service time during the suspension period, if you have not yet met the 2-year service requirement for GW to make contributions to a 401(a) Plan account. If you meet the 2-year service requirement for the first time during the suspension period, you will automatically be enrolled in the 401(a) Plan once the suspension period has ended. You will then make your investment provider and investment fund elections.

9. If I am a new GW employee, should I submit a 401(a) Plan prior service waiver (i.e., if I previously worked at an institution of higher education)?
Yes. Waivers should be submitted and will be processed once the suspension period has ended. See the 401(a) Prior Employment Verification form.

10. Will the GW contribution to my 401(a) Plan account be suspended if I am on paid leave?
Yes. GW’s contribution will be suspended for all 401(a) Plan participants who are on any form of paid leave, including GW Short Term Disability, Paid Parental Leave and other paid leaves. The GW contribution will automatically resume once the suspension has ended.

11. I am a visiting faculty member and my salary and fringe benefits are paid to GW by another institution. Will GW continue to make contributions to my 401(a) Plan account?
No. Contributions to the 401(a) Plan are being suspended for all participants, regardless of position funding source.

12. My position is fully funded by a grant: will GW continue to make contributions to my 401(a) Plan account?
No. Contributions to the 401(a) Plan are being suspended for all participants, regardless of position funding source.

13. I am a faculty member, how does my pay frequency, whether paid over 9 months or 12 months, impact the 2020 contributions GW makes to my 401(a) Plan account?
GW’s contributions will be calculated based on all eligible compensation earned during the plan year from January 1, 2020, through September 30, 2020. There will be a true-up calculation at the end of the year where we confirm that you receive your full contribution under the terms of the plan, regardless of pay frequency.