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STRS Ohio has prepared a 
plan comparison
chart to give a quick overview of the benefits provided by both
STRS Ohio and alternative retirement plans.
Eligible full-time faculty of Ohio public institutions of higher education have 120 days from their hire date to select to enroll in either STRS Ohio or an alternative retirement plan (ARP).
Once an employee elects to contribute to an alternative retirement plan or STRS Ohio, the choice cannot be changed. The election is final, and the election period is closed. Faculty who do not make an election will automatically become members of STRS Ohio.
New STRS Ohio members who do not choose an ARP within the 120-day election period, will have an additional 60 days (a total of 180 days from the first day of paid service) to select one of the three STRS Ohio retirement plans.
If the employee does not select an STRS Ohio plan during this 180-day period, they will automatically join the Defined Benefit Plan and remain in it as long as they are an STRS Ohio member.
If the employee chooses the Defined Contribution or Combined Plan, they will have the option of reselecting an STRS Ohio retirement plan before completing their fifth year of membership. The employee can then choose to remain in the same plan or transfer to one of the other two STRS Ohio plans. At that time, the employee’s STRS Ohio selection will be irrevocable. If the employee doesn’t actively elect to remain in the Defined Contribution or Combined Plan, they will be transferred to the Defined Benefit Plan. An account and service credit will be created as if the employee had originally chosen the Defined Benefit Plan.
Plan Structure
STRS Ohio offers three retirement plan options: a Defined Benefit, Defined
Contribution and a Combined plan.
Under the STRS Ohio Defined Benefit Plan, an employee’s retirement benefits are “defined” by a calculation that uses age, years of service and the average of the three highest salary years. The employee also has survivor and disability protection while teaching and access to health care coverage in retirement.
Under the STRS Ohio Defined Contribution Plan, an employee’s retirement income is based on the performance of investment choices selected by the employee for the contributions made by them and their employer. Contributions may be allocated among various investment options managed by STRS Ohio. Retirement, survivor and disability benefits are limited to the value of the account. Access to STRS Ohio health care coverage upon retirement is not provided. This plan is comparable to ARPs offered by private vendors.
The STRS Ohio Combined Plan allows an employee to create a portion of their retirement income through the performance of investment choices they select for their contributions, while contributions from their employer pay for a combination of service retirement, disability and survivor benefits. There is also access to health care coverage at age 60.
Alternative retirement plans are defined contribution plans. Similar to the STRS Ohio Defined Contribution Plan, in an ARP defined contribution plan an employee’s benefit is equal to the account balance at retirement. Since the account balance directly reflects investment performance, there is no guarantee of a monthly benefit.
Contribution Amounts
Under STRS Ohio, employers contribute 14% of each employee’s salary
while members contribute 10%.
Under the alternative retirement plan, employer contributions to the alternative retirement plan will be decided by the board of trustees of each public university or college. Employees will continue to be required to contribute 10% of salary.
For employees who elect an alternative retirement plan, the employer is required to remit and report monthly 3.5% employer contributions to STRS Ohio on compensation paid. This reporting and contribution requirement begins with earnings on the employee’s hire date.
