Type of Plan

IRC Section 457 – Pre-Tax Contributions

Who's Eligible

To enroll in the NJSEDCP, you must be employed by Rutgers University or the State of New Jersey or an eligible agency, authority, commission, or instrumentality of state government.

Employee Contribution

  • Under age 50: A combined pre-tax and after-tax contributions: $17,500 in 2015
  • Age 50 & Over: A maximum pre-tax and after-tax contributions: $23,000 in 2015
  • If eligible to make Special 457 Catch-up contributions: You may make a catch-up contribution in addition to your regular contribution during the last three years of employment prior to normal retirement. The allowable catch-up amount is one times the contribution amount for that year.

How it Works

You may voluntarily tax shelter a portion of your salary from federal income taxes while saving for retirement. Federal income tax is not due on deferred amounts or accumulated earnings until you receive a payment from your account.

Investment Options

A broad array of investment options.  The NJSEDCP Retirement Workbook contains additional information.

How to Enroll

  • Complete the NJSEDCP enrollment kit.
  • Return the completed forms to Prudential Retirement.
  • Enrollment kits may also be obtained from University Human Resources. To have an enrollment kit mailed to you, contact UHR at 848-932-3020.

Type of Plan

IRC 457 (Roth Contributions)

Who's Eligible?

To enroll in the NJSEDCP, you must be employed by Rutgers University or the State of New Jersey or an eligible agency, authority, commission, or instrumentality of state government.

Employee Contribution

2015 Maximum Employee Contribution Amount:

  • Under age 50: A combined pre-tax and after-tax contributions: $17,500
  • Age 50 & Over: A maximum pre-tax and after-tax contributions: $23,000
  • If eligible to make Special 457 Catch-up contributions: You may make a catch-up contribution in addition to your regular voluntary contribution during the last three years of employment prior to normal retirement. The allowable catch-up amount is one times the pre-tax contribution amount for that year.

How it Works

Roth contributions are made on an after-tax basis so the amount you contribute is included in your W-2 in the year you make your contribution. Since you already paid income tax on your Roth contributions, a withdrawal of your Roth contributions is always 100% federal income tax free. Once your distribution is ‘qualified’, you can take Roth earnings from your account free from federal income tax.
Roth contributions combine the saving and investment features of a traditional deferred compensation plan with the tax-free distribution features of the Roth IRA.

In addition:

  • The plan feature allows participants to make after-tax contributions to their Deferred Compensation Plan (457 plan).
  • Earnings accrue tax-free.
  • Distributions of Roth contributions are tax-free in retirement (if the Roth account is held for at least five years and distributed after age 59 1/2).
  • Your after-tax Roth Contributions are invested in your NJSEDCP account, as are any pre-tax contributions you make to the Deferred Compensation Plan (NJSEDCP).
  • Your Roth money is tracked separately from your pre-tax money, and will appear as a separate item on the NJSEDCP participant website and on your NJSEDCP statements.

How to Enroll

You need only select an allocation percentage for your Roth contributions. You may do this by logging into your account at Prudential online. The contributions will be made to your existing NJSEDCP account.
If you do not have an existing NJSEDCP account, you may enroll and begin making Roth and/or pretax contributions at any time. Simply visit Prudential NJSEDCP or complete an enrollment form.

For additional information about the Roth Contributions visit Prudential NJSEDCP.  Please visit the Investment Carrier Representatives webpage for contact information. You may also call a Benefits Specialist at 848-932-3990 and visit the Roth 457 Contributions FAQs.