A little planning with this employee benefit can go a long, long way toward securing your financial future. And there are new rules in 2025.
Northeastern offers employees a variety of retirement investment accounts through Fidelity and TIAA, including traditional 403(b) and Roth 403(b) plans. These allow holders to set aside a portion of each paycheck for after their working years. Faculty and staff with one year (and/or 1,000 hours) of full-time service are eligible to receive matching contributions to their plans from the university (free money, in effect). If you contribute at least 5% of your eligible pay, Northeastern will contribute 10% to your account.
New employees, or those newly eligible for benefits, can sign up for a retirement plan during the onboarding process. Current employees can make retirement account changes, including account selections and contribution amounts, through Workday at any time. (Follow the step-by-step instructions here.)
It depends on when you want to pay taxes. For traditional 403(b)s, contributions are pre-tax, but taking money out before the eligible age (59½) can come with hefty penalties, and later withdrawals will be taxed as income. Roth 403(b) contributions are made after taxes. This means more is deducted from each paycheck, but later withdrawals will be tax-free. A balance of both types can be a good option, and in Northeastern’s case, both types can include employer matching. This Human Resources chart breaks it down.
The IRS raised its maximum contribution limits this year: 403(b) holders can put in $23,500 annually, a $500 increase. Maximum “catch-up contributions” for older workers closer to retirement also increased. People over age 50 can contribute an additional $7,500 (for a $30,500 maximum). And those between the ages of 60-63 can contribute an additional $11,250 in ($34,750 maximum).
Two words: compound interest. The sooner you start saving, the more time your money will have to snowball. Investment experts generally agree that small, consistent payments yield a better return than saving higher amounts later on (see this case study laid out by Investopedia). Eligibility to contribute to the retirement and receive university matching at Northeastern starts at age 21 — for good reason.