Retirement Benefits for Postdocs: Lack of a Consensus
Editorial note:
Ankita Arora, PhD, is an international postdoctoral fellow in the University of Colorado- Anschutz Medical Campus, Aurora, CO and is the communications chair of the PDA at the University of Colorado- Anschutz Medical Campus/Denver.
Although postdoctoral scholars are not eligible to participate in a mandatory retirement plan at ASU, they are eligible to participate in one of our voluntary retirement plans at any time during your employment.
Retirement Benefits for Postdocs: Lack of a Consensus
After dedicating years of your life in pursuit of science and education, you land a postdoctoral position, only to end up with a meager salary, and short-term contracts with little likelihood of landing permanent jobs. Meanwhile, your peers in the industry get bonuses and benefits that outweigh your annual income. You watch your friends in other fields investing in stocks, buying houses and saving for the future as you struggle to make ends meet. This is a story that many postdoctoral scholars experience.
The benefits that postdocs receive on average do not match the extensive training and immense talent they bring to the table that fuels research and innovation. One of the benefits that vary greatly among postdocs is the retirement benefits. This is mostly attributed to the fact that postdoc positions are greatly defined by their sources of funding. Most institutions don’t treat postdocs as full-time employees—their position often lies in a grey zone between students and faculty or staff members.
According to the survey by the National Institutes of Health (NIH), ~29 percent of the institutions reported that none of their postdocs receive retirement benefits while only 3 institutions (~2 percent) provide retirement benefits to NRSA recipients.
Another layer of discrepancy arises from the university structure itself. Private universities with large endowments and donations have resources to provide match benefits to the postdocs. For example Emory University provides its postdocs access to employee 403(b) retirement plan and it matches the contribution. On the other hand, public-funded universities, dependent on state funding, while able to provide access to retirement plans, often fail to give matching benefits.
It seems unfair that postdocs performing the same jobs enjoy variable benefits based on either the funding sources or the institution they work for.
Given all the confusion about what is available to postdocs and what is not, here are a few things you can do to keep yourself informed:
Financial literacy. Educate yourself regarding best practices to handle income in a tax-efficient manner and the advantages of saving early. Invest in a financial literacy course or a book on investing, covering asset classes and investment styles, bonds, stocks and types of mutual funds. A great starting place is Personal Finance for PhDs podcasts.
Emergency fund. Consider setting up an emergency account to help with unanticipated expenditures and financial adversities. This would help with keeping your credit card debts to a minimum. As a rule of thumb, consider keeping aside 3 to 6 months' worth of living expenses in an emergency fund.
Institution's administration and human resources department. Get in touch with the benefits administrator at your university and keep yourself aware of the opportunities and resources you have in hand. Don’t feel afraid to ask questions in case of doubts.
The views and opinions expressed in this article are those of the author and do not reflect the position of any other entity or employer.