Texas Tech University

Retirement Plans

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Participation in retirement is a condition of employment. You will be automatically enrolled in the Teacher Retirement System upon hire. ORP is only available to select titles and positions on campus. Employees who are eligible will be contacted by HR via email.

Teacher Retirement System (TRS)

Defined Benefit Plan

The TRS retirement plan provides service and disability retirement benefits and death benefits. The plan is administered as a qualified governmental retirement plan under the provisions of the US Internal Revenue Code, Section 401(a). Monthly member contributions are made on a pre-tax basis, meaning at the time you receive your salary, you do not pay federal income tax on the portion of your salary used to make the contributions. Federal income tax on the contributions and interest is deferred until you receive a distribution from TRS, such as a refund or a retirement annuity. Withdrawn amounts from a member account or retirement benefits received become taxable income in the years they are paid. The TRS retirement plan is a defined benefit plan not regulated under the rules of ERISA, Employees Retirement Income Security Act of 1974. This means the amount of benefit paid is determined under a formula established by legislation. Once you begin service retirement under the rules of the plan, you are eligible to receive a monthly benefit for life. Your monthly benefit is “defined” by the formula; it is not limited by the amount of member accumulated contributions to the retirement account.

Membership

Your membership begins on your first day of eligible employment with a TRS-covered employer. Your employer provides TRS with your identifying information as well as the type of position. TRS will send you a “Welcome to Membership” letter on how to access the TRS Benefits handbook.  The handbook contains all the rules and requirements to be eligible for retirement.

Member Contribution Account

Your member account consists of contributions paid on your creditable compensation, amounts contributed to purchase service credit (excluding fees), and applicable interest. These are called your “accumulated contributions.”

Payroll Deduction

The amount a member contributes is established by legislation. The current required member contribution can be located on the TRS website. Employers deduct TRS contributions from your salary on a pre-tax basis and forwards directly to TRS.

Refund of Your TRS Contributions

You may end membership in TRS and withdraw contributions in your member account, if you:

  • Permanently terminate all employment with all TRS-covered employers, and
  • Have not applied for or received a promise of employment with the same or another TRS-covered employer

Responsibilites as a Member

Keep Informed – The features of the TRS retirement plan are established by state laws and are subject to change. It is important for members to keep up with changes that may affect benefits under this plan. Significant changes will be included in revisions of the TRS Handbook, in TRS Newsletters, and the TRS website.

Keep Address Current – For security reasons, TRS requires notification in writing of address changes. Your address of record is the address to which TRS sends confidential information regarding your account and to which TRS may send payments owed to you. The written notice must contain both your social security number and signature.

Check Your Annual Statement - Members must promptly notify TRS in writing if eligible membership service is not shown as service credit on the member's annual statement. To receive TRS credit for the service, you must notify TRS within five years of the end of the school year in which the service was rendered. Verification of the service must be on a form prescribed by TRS. 

Five Year Membership Credit

Members who have at least five years of membership service credit are eligible to retire and receive a lifetime monthly annuity when the applicable age requirements are met. If you have fewer than five years of service credit and have not qualified for a year of membership service credit in five consecutive years, TRS membership will terminate. Once membership is terminated, you will no longer receive TRS membership information, such as newsletters or annual account statements. Additionally, accumulated contributions in your account do not earn interest after the date membership terminates.

Beneficiary Designation by Members

Death benefits are part of the TRS retirement plan. Benefits begin on the first day of TRS-covered employment. For example, for members employed in TRS-covered positions, death benefits may pay an amount equal to twice your annual salary, with the amount payable capped at $80,000. For this reason, you should designate a beneficiary immediately upon becoming a member of TRS. Designating a beneficiary to receive your TRS benefits can be one of the most important things you do as a TRS participant. TRS encourages you to carefully consider your options to ensure your decision best serves your interests. Your employer is not authorized to receive TRS Designation of Beneficiary forms. Submit the form directly to TRS.

Your Account

Access your personal account information 24/7 by creating and signing into your account www.trs.texas.gov or call TRS for assistance at 1-800-223-8778.  TTY 1-800-841-4497

Teachers Retirement System of Texas
1000 Red River Street
Austin, TX 78701-2698

Optional Retirement Program (ORP)

ORP is an individualized defined contribution plan in which each participant selects from a variety of investments offered by several companies (authorized by TTUS) through annuity contracts or mutual fund investments. Because participants manage their own personal investment accounts, ORP entails more individual risk and responsibility than that associated with TRS membership. Benefits are a direct result of the amounts contributed and any net return on the investments selected by each participant.

Upon termination from Texas public higher education, ORP participants with more than one year of participation retain control over all investments (both employee and state contributions). Participants who terminate with one year or less of initial participation forfeit state contributions made during that period of employment. Post-termination distributions are determined by individual contract provisions, federal income tax law, and personal preference. Contracts may provide for complete or period withdrawals, or annuity income for a specified number of years or life.

ORP has no provisions for death and disability benefits similar to those provided by TRS. Administrative costs are paid by the participant through varying fees, "loads" and/or amount of interest paid.

ORP-eligible employees are provided only one opportunity during their entire career in Texas public higher education to select between these two distinct types of plans, and the choice can directly affect financial resources at retirement. Therefore, new or prospective ORP-eligible employees should carefully consider the advantages and disadvantages of each plan in light of personal circumstances. Factors to consider include: age, current and anticipated salary in future years, expected length of employment in Texas, previous retirement program participation, current and anticipated financial position, and, if ORP is selected, willingness to take the risks and responsibilities of managing one's own retirement investments.

Income Tax Sheltered Programs

In addition to participation in the TRS or ORP programs, employees of Texas Tech are eligible to set aside additional amounts of salary, up to certain limits, without paying current income tax on those amounts. This income tax deferment is available under the Tax Sheltered Annuity Program and the Deferred Compensation Program. Participation in these programs is voluntary, and employees may elect to participate in either or both programs. These programs are offered as a supplement to the retirement benefits provided by the TRS or ORP programs.

Tax Deferred Account Program

The Tax Deferred Account Program is available to employees on an optional basis. Under the Tax Deferred Account Program, employees may enter into an agreement with Texas Tech to reduce current earnings, up to specified limits, and apply the proceeds of such reduction to the purchase of fixed annuity, variable annuity, custodial, non-custodial, or mutual fund accounts with vendors approved by Texas Tech.For additional information about the Tax Sheltered / Deferred Annuity Program, see TTU OP 70.09 Tax Deferred Account Program.

Texa$aver Deferred Compensation Program

The Texa$aver Deferred Compensation Program (IRC 457) is available to employees on an optional basis. Under the Texa$aver program, employees may enter into an agreement with the state to reduce current earnings, up to specified limits, and apply the proceeds of such reductions to the purchase of investment products approved by the Employees Retirement System (ERS), the plan administrator. Employee deferrals and investment income become the property of the state of Texas until these funds are actually distributed to the employee.
For additional information about the Texa$aver deferred compensation program, visit the Texa$aver website link at www.texasaver.com.

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