By Schuler Wealth Planning | Columbus, Ohio 

If you work at The Ohio State University, or any university in Ohio, earn a high income, and notice your retirement contributions stopping before the end of the year, you’re not alone, and it’s not a mistake. 

Many OSU faculty, physicians, and administrators run into IRS and Ohio retirement system limits under OPERS, STRS, or the Alternative Retirement Plan (ARP). 

That’s exactly why Ohio Universities offer the Retirement Continuation Plan (RCP) / 415(m) — one of the most valuable and least understood benefits available to high-earning university employees. 

At Schuler Wealth Planning, we regularly help Ohio State employees understand how this plan works and how to use it effectively as part of a long-term retirement and tax strategy. 

Why the RCP / 415(m) Matters for OSU Employees in Columbus 

Ohio law limits how much compensation can be used for retirement contributions each year. Once those limits are reached: 

• Contributions to OPERS, STRS, or ARP stop 
• Your paycheck often increases 
• Your ability to save for retirement temporarily disappears 

The RCP / 415(m) solves this problem by allowing eligible Ohio State employees to continue saving for retirement after mandatory plan limits are reached. 

This makes it especially important for high earners working at OSU Wexner Medical Center, OSU academic departments, and administrative leadership roles across Columbus. 

Who Should Pay Attention to the RCP / 415(m)? 

This plan is most relevant for: 

• OSU faculty in Columbus with base salaries of $360,000 or more (Note: bonuses and additional pay are not included for eligibility purposes). 
• Physicians and clinical faculty at OSU Wexner Medical Center 
• Senior administrators and executives at The Ohio State University 
• Employees enrolled in the ARP or member-directed OPERS/STRS plans who hit the $72,000 contribution cap 
• OSU employees already maxing out a 403(b) and 457(b) 
• Individuals planning to retire in the next 5–10 years and focused on tax-efficient income planning 

If you work at Ohio State and your retirement contributions stop mid-year, the RCP / 415(m) is a benefit you should understand. 

RCP vs. 415(m): What Employees Need to Know 

Although often mentioned together, the RCP and 415(m) are two distinct plans. 

OPERS or STRS Pension (Defined Benefit) 

• Contributions first spill into the RCP (401(a)) 
• Then into the 415(m) if income continues to exceed limits 

ARP or Member-Directed OPERS/STRS (Defined Contribution) 

• Contributions spill directly into the 415(m) 
• No RCP account applies 

This structure exists because IRS rules limit contributions across 401(a) plans, requiring high-income spillover to move into a non-qualified 415(m) plan. 

How Contributions Work 

Employee Contributions 

• 10% of eligible compensation 
• Applies to up to $360,000 of additional earnings 
• Required once eligible 

Employer Contributions 

• Discretionary, based on department 
• Typical ranges: 0%, 8%, 10%, or up to 25% 
• Physicians may have an employer contribution cap 

All contributions vest immediately. 

How Much Can You Save? 

Depending on your retirement plan and income level: 

• Defined Contribution participants (ARP / Member-Directed) 
  • Eligible retirement earnings up to $720,000 

• Defined Benefit participants (OPERS / STRS Pension) 
  • Eligible retirement earnings up to $1,080,000 

Example: How Contributions Work on a $1,080,000 Salary for OPERS/STRS Pension Employees 

When compensation exceeds standard retirement plan limits, contributions spillover into multiple plans. 

First $360,000 of Salary 

The first $360,000 of salary goes entirely into the defined benefit (pension) plan. 

• Employee contribution (Pension @ 10%): $36,000 
• Employer contribution (Pension @ 14%): $50,400 
• Total contributed to the pension: $86,400 

Second $360,000 of Salary (RCP Spillover) 

Once pension limits are reached, contributions spill over into the RCP. 

• Employee contribution (RCP @ 10%): $36,000 
• Employer contribution (RCP @ 10%): $36,000 
• Total RCP contributions: $72,000 

Third $360,000 of Salary (415(m) Spillover) 

Additional compensation beyond RCP limits flows into the 415(m) plan. 

• Employee contribution (415(m) @ 10%): $36,000 
• Employer contribution (415(m) @ 10%): $36,000 
• Total 415(m) contributions: $72,000 

Total Contributions on $1,080,000 Salary 

• Total employee contributions: $108,000 
• Total employer contributions: $122,400 

Bottom line: Even after standard retirement limits are reached, the RCP and 415(m) plans allow high earners to continue saving for retirement on a much larger portion of their income. 

Investment Options 

• RCP / 415(m) accounts are administered by a third-party custodian  
• Investment options mirror OSU’s mandatory retirement plans: 
  • Target Date Funds 
  • Core Mutual Fund Menu 
  • Experienced Investor Options 
• Investments can be adjusted at any time 

Distributions, Taxes, and Retirement Planning 

This is where careful planning matters most! 

When you first become eligible, you must elect: 

• When distributions will begin, and 
• How they will be paid (lump sum or installments) 

If no election is made: 

• Distributions begin immediately after employment ends 
• The 415(m) defaults to a lump-sum payout 

Distribution Choices 

• Lump sum (fully taxable in the year received) 
• 5–10 year installment payouts, often more tax-efficient 

Key advantages for OSU employees: 

• No 10% early withdrawal penalty 
• Withdrawals allowed before age 59½ after separation 
• Similar flexibility to a 457 plan 

Changes to distribution elections require at least one year of advance planning, making early guidance especially valuable. 

Can OSU Employees Still Use Other Retirement Accounts? 

Yes. Eligible employees may also contribute to: 

• 403(b): $24,500 
• 457(b): $24,500 

These limits are separate from OPERS, STRS, ARP, and the RCP / 415(m). 

Why This Matters 

The RCP / 415(m) is one of the most powerful, and least understood benefits available to high-earning OSU employees. 

Used correctly, it can: 

• Significantly increase retirement savings 
• Improve long-term tax efficiency 
• Prevent unpleasant surprises at retirement 

Used incorrectly — or ignored — it can result in: 

• Forced lump-sum taxation 
• Missed savings opportunities 
• Poor coordination with Social Security, pensions, and other income sources 

Why OSU Employees in Columbus Work With Schuler Wealth Planning 

At Schuler Wealth Planning, we are a Columbus-based financial planning firm that specializes in helping: 

• Ohio State University faculty and staff 
• OSU physicians and medical professionals 
• OPERS, STRS, and ARP participants 

We help clients: 

• Understand how the RCP / 415(m) fits into their retirement plan 
• Coordinate distributions with pensions and Social Security 
• Reduce taxes during high-income years and retirement 
• Avoid forced lump-sum taxation mistakes 

Next Steps 

If you work at The Ohio State University in Columbus, or any university in the state of Ohio, and believe you may be eligible for the RCP / 415(m), professional guidance can help you get the most from this benefit. 

Contact us at Schuler Wealth Planning and we’ll be happy to help. We serve OSU employees in Columbus, Ohio and throughout the state of Ohio.  

This article is for educational purposes only and does not constitute tax or legal advice. 

Source: https://hr.osu.edu/benefits/retirement/  

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