Human Resources
Optional Retirement Plan FAQ
The Optional Retirement Plan (ORP) is an alternative
retirement plan (a “defined contribution plan”) provided by a private
carrier for academic and professional employees of Louisiana colleges and
universities.
WHY IS THIS A CALLED A “Defined Contribution Plan”?
ORP is a “defined contribution plan” to which you, as
an employee, and GSU make contributions to be invested in a retirement
annuity contract in your name. ORP benefits are paid in the form of a
lifetime income and, except for death benefits; single-sum payments (lump
sum) are not permitted.
WHO ADMINISTERS THIS PLAN?
The Teachers Retirement System of Louisiana administers the plan. ORPs,
which were first offered in 1990, are offered by:
Who is eligible for membership?
You are eligible for membership if you are a new
academic or unclassified staff member or a current staff member with less
than five years of service credit to the Teachers’ Retirement System of
Louisiana (with a few exceptions). Academic employees include all faculty
ranks (instructor, assistant professor, associate professor, professor, and
librarian). Unclassified and other academic employees include
administrative officers, unclassified staff, teaching associates, research
associates, library associates, and coordinators. If you are a nonresident
alien with a J or F visa, you are not eligible for membership
in a retirement plan.
If I decide to participate in ORP, may I later change to another plan?
No. The decision to participate in ORP is
irrevocable. You may not enroll in ORP and then later change to the TRSL
defined benefit plan. You may elect to change ORP carrier in November of
each year for an effective date of the following January.
What investment options do I have?
There are many investment options in ORP. Each option
has varying degrees of financial risk and rates of return. You may contact
the ORP representative for information concerning options.
What is my contribution to the plan?
Your employee contribution is 8 percent of gross
salary and is tax-sheltered. TRSL charges you 0.1 percent to administer the
funds. GSU pays an employer contribution. The contribution rate is subject
to change each July 1st.
If I terminate employment before retirement, can I
receive a lump-sum refund?
State law does not permit a lump sum refund at
termination. At termination of employment, you retain ownership of your
account. You may elect to receive a monthly benefit based on the value of
your account.
Should I designate a beneficiary?
Yes, it is important to designate a person to receive
benefits in the event of your death prior to retirement.
How long must I participate to be vested?
Your ORP account is immediately vested.
If I participate in ORP, do I also contribute to social
security?
No, if you contribute to ORP, you do not participate in
Social Security; however, if you were hired after April 1, 1986, you must
pay the Medicare portion of the FICA tax (1.45 percent of your salary.)
When may I retire?
As an ORP participant, you are eligible to annualize
your ORP account at termination of employment. In order to be eligible to
continue group insurance policies after retirement, you, as an ORP retiree,
must have the same required years of service as the TRSL retiree. *Refer to
TRSL
What if I become disabled?
If you become disabled, you must have at least five
years of service to apply for disability retirement on the ORP. GSU will
require a medical examination by an independent physician. The physician
must certify that you are mentally or physically incapacitated for further
performance of the duties currently being performed, that the incapacity is
likely to be total and permanent, and that you should be retired.
If approved, you may continue participation in the
insurance plans in effect at the time of your retirement on the ORP.
If I die, what benefits are available to my survivors?
Your survivors may choose a lump-sum refund or elect to
receive a monthly benefit based on the value of your account.
