1. Presented by: UW-Superior Human Resources Erika Bjerketvedt, Laura Dahl, Julie Lund, Steve Marshall, Gigi Koenig

2.  For faculty and instructional academic staff: between 7/3/2015 and 1/8/2016, unless authorized by the Chancellor because of exigent circumstances.  For all other eligible appointment types: between 7/3/2015 and 8/31/2015, unless authorized by the Chancellor because of exigent circumstances.

3.  Eligible employees must submit completed applications for consideration in the VSIP no later than April 15, 2015.  VC’s, Dean of Faculty, Dean of Students will evaluate applications and provide recommendations to the Chancellor for final action.  Chancellor’s final decisions communicated to applicants by May 6, 2015.  Effective voluntary separations begin as early as July 3, 2015.

4.  Employee benefit amount is arrived by taking 50% of base pay, prorated for FTE.  Example: An employee at a full-time rate of $80,000 with a 75% position would be eligible for $30,000.  Full-time base rate of $80,000 x 75%FTE = $60,000 x 50% = $30,000  Benefit amount does not include:  Overloads  Winterim, summer service, summer session amounts  Overtime  Standby pay  Weekend, night, shift differentials, etc.

5. Adjusted Base Salary = $50,000 Differential + $ 200 Overtime pay + $ 650 _______________________________ Total Compensation = $50,850 Total separation incentive amount = $25,000

6. Contract Base Salary (adjusted for FTE) = $60,000 Overload + $ 1,500 Summer session + $ 3,200 _______________________________ Total Compensation = $64,700 Total separation incentive amount = $30,000

7. There are 3 methods for distribution: 1. Cash lump sum payout 2. Contributions to pre-tax plans 3. WRS Actuarial Reduction Benefit An employee can select 1,2,or all 3 of these 3 options.

8. Employee may choose a cash payout of the separation incentive in a lump sum payment at the end of their employment. Points to consider:  Employees considering this option in full or part should consult with a tax advisor or financial planner.  Employees are urged to work with HR/Payroll as soon as possible if changes are planned.

9. Employee may choose to use any of the pre-tax investment options the university offers.  403(b) plan  457 Wisconsin Deferred Compensation Plan (WDC)  Health Savings Accounts (HSA) ( must have a HDHP)

10. Points to consider:  Please keep all plan limits in mind.  403(b) Plan ($18,000 for 2015. Employees age 50 or over at the end of the calendar year can also make “catch-up” contributions of $6,000 for a total of $24,000/year.)  457(b) WDC ($18,000 for 2015; “catch-up” contributions of $6,000 for total of $24,000/year)  HSA contributions limits for 2015:  Individual = $3,350  Family = $6,650  HSA “catch-up” contribution for 55+ = $1,000

11. Option 3 compares the WRS annuity amount at the employees estimated retirement date to what the annuity amount would be at the retirement age of 65. This calculation will be estimated at individual meetings. ETF uses a formula to determine the cost associated with funding the higher monthly annuity payment amount. In most cases, the “Age 65” amount will be higher than the estimate using your current 2015 age.

12. Example: Employee is Age 62 Estimate #1 (Based on retirement date of 8/31/2015*) 3 highest years earnings Creditable years of service up through 8/31/2015* Include your Age Reduction Factor set by ETF Normal Retirement Age (NRA) = 65 * Date will vary dependent upon employee’s actual retirement date

13. Example: Employee is Age 62 Estimate #2 (Retirement date based on the date of employees 65 th birthday) 3 highest years earnings Creditable years of service up through 8/31/2015* Include your Age Reduction Factor set by ETF (should be “none”) Normal Retirement Age (NRA) = 65 *Date will vary dependent upon employee’s actual retirement date

14. Determine if an actuarial reduction exists: 1. If calculation #2 </= calculation #1 – there is no actuarial reduction to purchase. Employee would not be eligible for the actuarial reduction benefit. This happens when the money purchase benefit is greater than the formula benefit in calculation #1 or if no age reduction exists in the formula calculation. 2. If calculation #2 is > calculation #1, an actuarial reduction exists. This means that the un-reduced benefit at employees NRA is greater than the current benefit the employee would receive in calculation #1.

15. Employee: John Doe Empl ID # 00000001 1.Calculation #2 for “Annuitant’s Life Only” $2,094.00 2.Calculation #1 for “Annuitant ‘s Life Only”($1,999.71) 3.Resulting difference in monthly annuity $94.29 4.Divide by calculation #1 “Money Purchase Factor”.006500 5.Cost of Actuarial Reduction Benefit$14,506.15

16.  Determined cost of the Actuarial Reduction: $14,506.15  Example: 50% of base salary = $30,000 $30,000 - $14,506.15 = $15,493.85 remaining that can be disbursed in anyway between the remaining Options 1& 2.  Examples of disbursement scenarios:  $15,493.85-$10,000 into your 403(b) and take a cash payout of $5,493.85  Start a TSA for the first time and put all $15K+ into it  Take it all as a cash payout  Put $10,000 into your 403((b) and start up a 457 WDC with $5,493.83

17.  Points to consider:  The closer to Age 65, the lower the actuarial reduction benefit will be and the lower the actuarial reduction benefit will cost.  Actuarial reduction benefit can change significantly depending on several factors: Age at retirement Years of credible service Money purchase balance Final average monthly earning based on 3 highest years of earning  Contact HR for a retirement session to calculate your specific scenario.

18.  Review ETF statement of account in the “My Wisconsin” portal.  Phone ETF ASAP requesting a retirement estimate and actuarial reduction estimate; stating UW-Superior employment & eligible for VSIP 1-877-533-5020  Contact HR to make an appointment if interested in the VSIP. HR staff are booking appointments and can arrange a time that works with your schedule.

19.  ETF Face to face meetings northwest region: http://etf.wi.gov/members/northwest.htm  ETF webinars: http://etf.wi.gov/member_education.htm

20. Eligible employees are advised and encouraged to contact ETF, a tax advisor, financial planner and/or attorney. HR staff may be helpful in calculating amounts but cannot advise employees. Classified Staff – Julie Lund Unclassified – Steve Marshall

21.  Eligible employees must submit completed applications for consideration in the VSIP no later than April 15, 2015.  VC’s, Dean of Faculty, Dean of Students will evaluate applications and provide recommendations to the Chancellor for final action.  Chancellor’s final decisions communicated to applicants by May 6, 2015.  Effective voluntary separations begin as early as July 3, 2015.