For Non-Profit/Government
GAFRI knows retirement planning, and our companies have been providing retirement security for
employees of non-profit organizations for more than 30 years. With our focus on
meeting the needs of educators and other non-profit organizations, we have the
expertise and knowledge to support the needs and requirements of the non-profit
marketplace. We will work with you and your financial professional to be sure
that you have chosen the right plan. You can also count on us to provide
flexible, high-quality, and cost-effective solutions for years to come.
Read more about group pension plans for non-profit organizations and government:
Types of Plans
There are as many types of retirement plans as there are reasons for
establishing a plan. Selecting the right one can be overwhelming. GAFRI is
ready to work with you and your financial professional to evaluate your
organization's retirement plan needs.
Employee 403(b)
Employee 403(b) plans are tax-sheltered retirement annuities for employees of
certain tax-exempt employers that receive only employee deferrals through
salary reduction agreements. This type of plan may be established by public
schools, universities, colleges, and non-profit 501(c)(3) organizations.
Employer 403(b)
Employer 403(b) plans are tax-sheltered retirement annuities for employees of
certain tax-exempt employers that may receive employer discretionary
contributions and/or employee deferrals and employer-matching contributions.
Public schools, universities, colleges, and non-profit 501(c)(3) organizations
are all eligible to establish employer 403(b) plans.
457(b) Governmental
A 457(b) governmental plan is a deferred compensation arrangement of an
eligible employer. This type of plan may be established by states, political
subdivisions of a state and their agencies or instrumentalities, public
schools, universities, and colleges.
457(b) Non-Governmental
A 457(b) non-governmental plan is also a deferred compensation arrangement of
an eligible employer. However, this type of plan may be only established by
non-governmental tax-exempt organizations.
457(f)
A 457(f) plan is a deferred compensation arrangement by an eligible employer
that fails to meet the requirements of Section 457(b). This type of plan may
be established by states, political subdivisions of a state, their agencies or
instrumentatlities, and non-governmental tax-exempt organizations.
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What to Consider
There are some decisions you'll need to make to put your plan in place, and
certain things you will need to consider when choosing an appropriate
retirement plan for your organization. Will you match employee contributions?
How long do employees need to be with your organization to be vested in
contributions you make on their behalf? How will you administer the plan? GAFRI
can assist you with these questions and more.
Limits on Contributions
Each year the IRS sets limits for each type of plan for the amount that can be
contributed. The limits are set to increase based on inflation in the coming
years. GAFRI representatives have the most up-to-date information to share with
you.
Tax Law
Contributions to a qualified retirement plan grow tax-deferred. That means
taxes will not be due on any of the contributions until a participant receives
a distribution. All distributions are subject to ordinary income tax, and there
may be an additional 10 percent tax penalty if taken before age 59½. GAFRI does
not provide tax advice. Consult your tax professional for full details.
Loans
Depending on the type of plan you choose, loans may be made available to
participants, allowing them to access part of what they have contributed prior
to retirement. Any time a loan is issued, the participant's contract value is
used as collateral for the loan.
Plan Document Requirements
Although many plans for non-profit organizations do not require an official
plan document, you will need to make information about the plan available to
your employees. Our companies can provide you with materials that can
help your employees understand the options they have to prepare for retirement.
Cost to Your Organization
The cost of offering a retirement plan will depend on the type of plan you
choose. You may choose to match all or a portion of employee contributions.
Matching contributions can be a great tool for attracting and retaining
qualified employees. You'll also need to consider the costs of administering a
retirement plan, such as using a third-party administrator or the staff time it
would take to administer it yourself. These are all decisions with which our
Qualified Plans team can assist you.
GAFRI's affiliated company, Great American Plan Administrators, Inc, specializes
in Tax-Sheltered Annuity [403(b)] and Deferred Compensation [457] plan
administration. For more information, visit www.gaplandata.com.
If you have questions about a retirement plan for your non-profit organization,
contact our Group Retirement Plans team at 800.789.6771, ext. 10600, or send us
an e-mail at qualifiedplans@gafri.com.
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