RPB’s retirement plan helps you accumulate savings for retirement, so you most likely won’t begin withdrawing your money until then. But depending on your financial situation, you may also take withdrawals at other times. We recommend that you consult with a financial advisor before making any withdrawal decision.

Distribution Options from RPB

The RPB Pension Plan offers several options for receiving distributions at retirement. Participants may establish a monthly distribution from their account under the Flexible Payment Option, rollover all or part of their account balance to another qualified retirement account, take a direct distribution of all or part of their account balance or purchase an institutionally priced annuity with MetLife through RPB. Participants may choose one or a combination of these distribution options. Please see further information on our retirement options in the following descriptions and chart:

  • Flexible Payment Option: The most popular distribution option with benefits including: continued exposure to the financial markets, which could provide growth potential to a pension account, investments managed by RPB, and account balance transfer to beneficiaries in case of death. There is a certain amount of risk with this option: participants may outlive the money in their pension accounts depending on the level of actual earnings and distributions, and exposure to the financial markets could result in lower balances when the markets have negative results.
  • Lump Sum: The partial lump sum rollovers or direct distribution options can be taken no more than once per year. Lump sum distributions are valued on the date the distribution is processed. Please read our Special Tax Notice if you are considering a lump sum distribution.
    • Rollovers: A lump sum rollover to another financial institution carries both a potential benefit and a potential risk, since account and investment management is decided by the participant within the parameters of the entity receiving the rollover. If clergy roll money out of the Reform Pension Plan, they risk a likely loss of their parsonage exclusion exemption benefit.
    • Direct: A direct distribution gives full responsibility for investment and management of the funds to the participant and the entire distribution is subject to taxation. If clergy roll money out of the Reform Pension Plan, they risk a likely loss of their parsonage exclusion exemption benefit.
  • Annuity: You can purchase an institutionally priced annuity with MetLife through RPB. The MetLife Guaranteed Income Program provides you (and your spouse/partner, if elected) with stable, predictable income payments that continue for life.* Payment options can be elected to keep up with inflation and ensure a cash refund to your beneficiary for any purchase payments not already received as income.** Clergy should note that annuity income is eligible for parsonage exclusion.

* This guarantee is based on the claims-paying ability and financial strength of Metlife.
** The amount of the distribution you receive will vary based upon the type of annuity that you purchase.

Please contact the RPB office for additional information and to request forms for the various distribution options.

Type of Distribution Benefits Risks
Flexible Payment Option
  • Exposure to market could provide growth potential to pension account
  • Account balance, if any, at death is transferred to beneficiary(ies)
  • RPB does the investing
  • Distributions are eligible for parsonage exclusion for clergy
  • Continued personalized service from professional RPB staff
  • Exposure to market could result in lower balances when financial markets have negative results
  • Participants can outlive the money in their pension account depending on the level of earnings and distributions
Lump Sum Rollovers to another Tax-Deferred Program or Personal IRA
  • Account and investment management is decided by the participant within the parameters of the entity receiving the rollover
  • Account and investment management is decided by the participant within the parameters of the entity receiving the rollover
  • Possible loss of parsonage for clergy
Lump Sum Distributions
  • Full responsibility for account investment and management is with participant
  • Full responsibility for account investment and management is with participant
  • Possible loss of parsonage for clergy
  • Entire distribution is subject to taxation
Annuities Purchased through RPB
  • Distributions guaranteed for life* including distributions to another person: spouse, partner, or child, if elected
  • Participants can select from a variety of payment options**
  • Institutional pricing
  • Fixed income payments not affected by market volatility
  • Distributions are eligible for parsonage exclusion for clergy
  • Value of distributions is affected over time by inflation (unless an income-protection option is elected)

* This guarantee is based on the claims-paying ability and financial strength of Metlife.
** The amount of the distribution you receive will vary based upon the type of annuity that you purchase.

SPECIAL TAX NOTICE – LUMP SUM DISTRIBUTIONS

The partial lump sum rollovers or direct distribution options can only be taken once a year. Please read our Special Tax Notice if you are considering a lump sum distribution.

DISTRIBUTIONS PRIOR TO AGE 55

If you are under age 55, you may withdraw all or a portion of your pension funds if you no longer work for an eligible employer as defined by the RPB Pension Plan Document. These withdrawals can be made as a direct distribution or as a rollover to another qualified retirement plan. IRS penalties may be incurred for direct distributions.

DISTRIBUTIONS BETWEEN AGE 55 AND 59 1/2

If you are between the ages of 55 and 59 ½, you may withdraw all or a portion of your pension funds with no waiting period after you no longer work for an RPB-defined eligible employer. These withdrawals can be made as a direct distribution or as a rollover to another qualified retirement plan. IRS penalties may be incurred for direct distributions.

DISTRIBUTIONS AT AGE 59 ½ OR OLDER

You may withdraw all or a portion of your pension funds with no waiting period and no employment restrictions once you reach the age of 59 ½. See above for the different types of distributions available from RPB.

Required Minimum Distributions (RMDs)

The IRS requires participants who reach the age of 70 ½ and are retired (stopped working for an eligible Reform Movement employer) to take a Required Minimum Distribution (RMD) from their qualified 403(b) retirement plan each year.

RPB will notify you about your RMD at the beginning of the calendar year. The RMD amount is based on the value of your 403(b) retirement account as of December 31 of the prior calendar year and your age. Your spouse’s age is also a factor if there is an age difference greater than 10 years. Rabbi Trust balances are not included in the RMD calculation.

You can estimate your annual RMD by using Vanguard’s RMD calculator. If you’re already receiving monthly distributions from your RPB 403(b) retirement account, those payments count towards satisfying your RMD for the year. Please contact RPB at 212-681-1818 if you have questions concerning your RMD.

Hardship Withdrawals

RPB allows participants who qualify to take hardship withdrawals from the Plan in accordance with IRS regulations. If you are considering requesting a hardship withdrawal, please read the “RPB Hardship Withdrawal Requirement Rules” and our “Q&A for Hardship Withdrawals” to learn the criteria necessary to qualify. We understand that you may be in a difficult situation. Please contact our office if you need to obtain a hardship withdrawal request package or have questions.

403(b) Loans

You can apply for a general purpose loan or a loan to purchase your primary residence.

Borrowing from your 403(b) account may be a better option than taking out a loan from a credit card or commercial institution. Still, it’s important to consider that taking a loan from your 403(b) account may mean less money in retirement. Even though you’ll be repaying yourself, there’s a chance you’ll lose tax-deferred growth on that money.

Highlights

What you need to know:

  • Purpose: Loans taken for a general purpose may be repaid in up to five years; loans taken for the purchase of a primary residence may be repaid in up to ten years.
  • Eligibility: You must be enrolled in RPB’s plan for at least one year and have $2,000 or more in your 403(b) account. You can only have one loan outstanding at any time.
  • Loan amounts: You can borrow $50,000 or 50% of your 403(b) account balance, whichever is less. There is a $1,000 minimum loan amount.
  • Interest Rate: Loans are charged a fixed interest rate based on the prime rate published by the Wall Street Journal as of the loan date—plus 1%.
  • Fees: There is a one-time $100 origination fee and an annual $50 loan processing fee for the duration of the loan. Fees are non-refundable.
  • Contributions: While you’re paying back the loan, you can still make additional contributions to your retirement account.
  • Loans vs. Hardship Withdrawals: It may be better to borrow money rather than take a hardship withdrawal. A hardship withdrawal is based on an immediate financial need that specifically qualifies as a hardship, and, if you’re under 59½, may be subject to a 10% early withdrawal tax penalty. The hardship withdrawal money is taxed and can’t be repaid—so it’s no longer part of your retirement nest egg. When you take a loan, unlike a hardship withdrawal, the money isn’t taxed and must be paid back to your 403(b) account.

Is This For You?

Considering if a loan’s right for you

Opportunity cost: Taking loans from your 403(b) account can limit the tax-deferred growth of your retirement savings. The loan amount won’t benefit from any compounding that adds to the growth of your assets.
Costly to default: If you default on your loan, your loan balance plus interest will be taxed as a distribution, and if you’re under 59½, you’ll also pay a 10% penalty.
The interest is yours: Payments to your loan, including the interest, go back into your account. With bank loans, the interest you’re charged goes to the financial institution.

Instructions

General purpose loan

You can apply for a general purpose loan online in the InfoExpress Loan Center. The loan proceeds will be taken from ALL of your funds proportionally.

If you’re married, you’ll need a notarized Spousal Consent form at time of application. We recommend that you have the Spousal Consent form ready to upload when you’re applying for the loan.

If you want the money drawn from ONLY the investment funds you select, follow the directions in the InfoExpress Loan Center instructions.

Residential loan

To request a residential loan, log into InfoExpress, click Loan Center, and select Model a New Loan. You can enter different loan amounts and repayment periods to determine the monthly payment amount that is manageable for you. Then, download the loan application from InfoExpress and submit your completed application along with the home purchase agreement to RPB using the link on our forms page.

Before you apply, review RPB’s Loan Policy and InfoExpress Loan Center instructions for complete details.

 

Repayment

After taking out a loan, there are a few things you need to know about paying it back:

  • You’ll be required to provide your bank account information to process the monthly electronic repayments. Setting this is up is easy and is done during the application process.
  • Defaulting on a 403(b) loan may result in the loan becoming a permanent early distribution with taxes and penalties.
  • You may pay off your loan at any time without penalty. You can get an estimated payoff amount in the Loan Center. Contact Alerus at 1-800-433-1685 for an exact loan payoff amount.