Retirement Countdown: 1 YearPre-Retirement Sessions for County Employees considering retirement in the next year.
Retirement Countdown: 1 Year
Today’s agenda will include the following: A presentation by PERS regarding your
retirement plan A presentation by Great West/ICMA-RC
representatives regarding options for your deferred compensation account
A presentation by Washington County Employees Benefits Team regarding post-employment insurance options
PERS Education and Retirement Planning
Welcome !
PERS One-Year Group
Updated: 5/14/2012
Disclaimer
Information may change as the result of administrative, legislative or judicial decisions.
Agenda
Individual Account Program Retirement Eligibility Calculation Factors and Methods Review of Estimate of Benefits PERS Retirement Processes
Health insurance; COLA Variable after retirement Working in retirement; Taxes
Review Retirement Forms
Individual Account Program
Effective January 1, 2004 Member contributions to Individual Account
Program (IAP) No contributions to PERS member account
after this date Retirement forms for IAP and separate
retirement forms for PERS Retirement benefit from IAP and separate
retirement benefit from PERS
IAP Retirement When retire from PERS, must retire from IAP Retirement date
1st day of any month Submit retirement forms within the 90 day period
prior to your retirement date First payment due
Within 120 days of retirement date
IAP Distributions
IAP retirement benefit choices Lump sum (mailed direct to member) Installments over 5-10-15-20 year periods, or Anticipated Life Span Option
Can receive IAP distributions only after separation from PERS covered employment
IAP cannot be used for Trustee to Trustee Transfers
PERS Trustee to Trustee Transfer for Purchases
If eligible to purchase service time Can use pre-tax dollars from 457 deferred
compensation plan, or a 403(b) tax-sheltered annuity
Time limit on purchases Within the 90 days before retirement date
Transfer form required PERS: http://oregon.gov/PERS
PERS Data Verification Requests
Must be within two years of earliest service retirement age
Will cover following data elements Employment/Salary details Service time Regular and variable account balances Final average salary Unused sick leave (beginning July 1, 2012)
PERS Data Verification Requests
Form required PERS: http://oregon.gov/PERS First verification free
Data verification not an estimate Once verified, data is used in future
estimates and final benefit calculation Suggest requesting two years prior to
retirement date
Online Member Services
You can: Access your account information Perform activities related to your
account Produce your own estimate Link directly to the PERS web site to
view FAQs, forms and other information http://oregon.gov/PERS
30 years PERS Total Creditable Service Time
OR
Age Normal retirement
58 – Tier One 60 – Tier Two 55, or 50 + 25 years total service – P&F
Early retirement 55 50 – P&F
PERS Retirement Eligibility
The Calculation Factors
Age Service time Final Average Salary Account Balance
Calculation Methods
Full Formula Service time x final average salary x .0167
(P&F .0200)
Money Match Age factor x account balance x 2
Formula + Annuity (8/21/81) Service time x final average salary x .01
(P&F .0135)+
Age factor x account balance
Option 1 Calculation Method ComparisonOption 1 Calculation Method Comparison
Money Match $ 3,717.08
Full Formula $ 3,540.79
Formula + Annuity (Contributions prior to 8/21/81)
The Retirement Estimate: Age and Retirement Data
IMA PERSSON
1234 ANNUITY AVE
GOLD HILL, OR 97000
Date: 5/11/2012
PERS ID:
Member Date of Birth: 9/15/1952
Retirement Date: 7/1/2013
Last Day of Service: 6/30/2013
Termination Date: 6/30/2013
Retirement Age: 60 yrs 9 mos
The Retirement Estimate: Page TwoBeneficiary and Service Time
Beneficiary: Olov Year of Birth: 1955
Creditable Service Time: 30 yrs 6 mos
Granted Service (disability only): 0 yrs 0 mos
The Retirement Estimate: Page TwoService Time; Member Cost
Service Purchases: Prior Service Time: 0 yrsWaiting Time: 0 yrs 6 mos Sick Leave Hours: 0Forfeited Time: 0 yrs 0 mos Vacation Hours: 0Full Cost: 0 yrs 0 mos Contract Salary: $0.00Miscellaneous: 0 yrs 0 mos Contract Hours: 0
Estimated Member Cost: $723.78
Total Creditable Service with Purchase(s): 31 yrs 0 mos
Full-Cost Purchases
Senate Bill 711 – military service Senate Bill 665 – teaching time Costs
Present cost of future benefits Provides service time at high average cost
Member Cost
After-tax contributions in member account
1099 R Member cost is not taxed again in
retirement
The Retirement Estimate: Page Two Salaries
High 3 Years Last 36 Months
Year Salaries Year Months Salaries*
2010 $90,172.59 2013 6 $35,742.00
2009 $83,040.15 2012 12 $71,513.59
2008 $78,050.27 2011 12 $66,929.60
$251,263.01 2010 6 $49,660.33
$223,845.52
*includes projected salaries
Average monthly salary: $6,979.53
The Retirement EstimatePage Three: Account Information
Regular Variable Total
Current account balance: $187,339.04 $15,364.23 $202,703.27
Projected accountbalance at retirement: $210,310.77 $17,251.12 $227,561.89
The Retirement EstimatePage Three: Benefit Options and Amounts
Option 1 Calculation Method Comparison:
$3,717.08 Money Match
$3,540.79 Full Formula
Formula + Annuity
Tax RemedyHB3349 or SB656
The greater of either... HB 3349
Benefit increase Based on service time prior to October 1, 1991
SB 656 Based on service time if hired prior to July 14,
1995 Maximum 4% increase
Retirement Benefit Options
First twelve options pay member lifetime monthly benefit unless the Option 1 benefit is $200 month or less.
If Option 1 benefit is $200 month or less No monthly benefit Lump sum payment equal to actuarial value of
benefit
The Retirement Estimate: Page ThreeBenefit Options and Amounts
No Purchase With Purchase
Option 1 $3,861.04 $3,865.76
Refund Annuity $3,805.34 $3,810.01
Option 15 C $3,714.23 $3,718.77
Option 2 $3,405.45 $3,409.63
Option 2A $3,366.80 $3,370.92
Option 3 $3,617.81 $3,622.23
Option 3A $3,594.64 $3,599.04
The Retirement Estimate: Page ThreeLump Sum Benefit Options and Amounts
No Purchase With Purchase
Lump Sum Option 1 $2,213.91 $2,250.20
Lump Sum Option 2 $1,952.66 $1,984.67
Lump Sum Option 2A $1,930.52 $1,962.17
Lump Sum Option 3 $2,074.43 $2,108.44
Lump Sum Option 3A $2,061.14 $2,094.93
Total Lump Sum $472,728.95 $473,328.73
Retirement Option Choices
Option 1 Maximum monthly benefit No beneficiary
Refund Annuity and 15 Year Certain Member may choose multiple beneficiaries and change
them at any time Beneficiary benefits are limited
Refund Annuity: Nine – Eleven years 15 Year Certain
Retirement Option Choices Joint Survivorship Options
One beneficiary 60 days to change the beneficiary Options 2 and 2A
Full survivorship options With 2 and 2A, and a non-spousal beneficiary, see the PERS
website for possible benefit adjustments. Options 3 and 3A
Half survivorship options
Lump Sum Options
Projected account balance One through five annual installments Interest credited on unpaid balance Options 1, 2, 2A, 3 and 3A provide
lifetime monthly benefit
Total Lump Sum
Distribution of your PERS account with employer match
No monthly benefit paid One through five annual installments Interest credited on unpaid balance
The Retirement Estimate: Page FourAssumptions used in Projection
Account Balance: Regular Projected at 8% Variable Projected at 8%
Job Classification: Retirement Job Class 01
Salary Projections: Salary Projected to increase 0% annually
Time Limit on Purchase(s) During the 90 days before retirement Not on or after retirement date
Mail purchases to:PERSPO Box 2127Portland, OR 97208-2127
Purchase DocumentsWaiting Time and Forfeited Time
Health Insurance and Retirement Enrollment opportunities for PERS Sponsored
Health insurance At retirement At Medicare enrollment Any time, with at least 24 months of continuous
employer group coverage Other options
Employer sponsored plans (ORS 243.303) COBRA Portability and individual plans Spouse’s employer plan
PERS Sponsored Health Insurance: Additional points Eligibility
Retirees Spouses and dependents
Of current or deceased retirees Of deceased member eligible to retire
Subsidies may be available RHIA: At Medicare eligibility RHIPA: State of Oregon employees Requirements for subsidy eligibility
Total PERS-covered service time PERS group health insurance program
Retirement: Date; Forms; and Your Employer
Retirement date 1st of any month Based on age or service time
Submit the retirement forms Within the 90 day period prior to your
retirement date Resign all PERS-covered positions
Employer provides information to PERS
Retirement Forms
Call PERS Customer Service for a retirement package or download the forms from PERS website PERS mails you notice soon after
receipt of your retirement forms
First Monthly Check Issued
Within 92 days of retirement date Estimated payment or actual payment Retroactive
Notice of Entitlement
Notice of Entitlement Option changes possible within 60 days of first
benefit check or receipt of NOE, whichever is later
Dispute Notice 240 days from the later of:
Date first actual payment is made Date Notice of Entitlement is provided to the
member
Cost of Living Adjustment (COLA)
An annual adjustment payable August 1st
Up to 2% of the July gross benefit 2% is the maximum increase
July 1st retirement Last date to retire in any year, and receive the
COLA for that year
• Variable Dollars At Retirement• Number of units
• Variable Annuity Unit Value• Set annually (11/1 - 10/31)
• Variable Annuity Income• Part of benefit• Based on unit value
Variable Annuity
InitialBenefit
$1,000+ 500+ 500
$2,000
Account Balance Account Balance -- $100,000$100,000
$50,000-R $50,000-V
VariableAnnuity
$500 $500
FixedAnnuity
Variable Annuity Example
$100,000
FixedPension
$1,000
VARIABLE ANNUITY EXAMPLEVARIABLE ANNUITY EXAMPLE
Year 2: 11/1-10/31 - Variable = 18%
Variable Per Cent = 18% Variable Per Cent = 18% -- 8% = = 10%10%
Var. Change = $500 x Var. Change = $500 x (10%) = = $50
Benefit = $1000 + $500 + $Benefit = $1000 + $500 + $550 = = $2050$2050
VARIABLE ANNUITY EXAMPLEVARIABLE ANNUITY EXAMPLE
Year 3: 11/1-10/31 - Variable = 0%
Variable Per Cent = 0% Variable Per Cent = 0% -- 8% = = -- 8%8%
Var. Change = $550 x Var. Change = $550 x (-8%) = = - $44
Benefit = $1000 + $500 + Benefit = $1000 + $500 + 506 = = $2006$2006
Working after PERS Retirement For a Private-sector employer
No employment limit For Oregon PERS-participating Employers
1039 hours/calendar year limit Exceptions exist
Only for normal retirement (age or service time) Review exceptions on http://oregon.gov/PERS
PERS and Social Security benefit: Higher of 1039 hrs/calendar year or Social Security
limit.
Tax Considerations
Monthly benefit Subject to state and federal taxes Oregon residents
Subject to Oregon and federal tax
Non-Oregon residents Federal tax only; no Oregon tax No withholding for any other state
Member Resources Websites and E-mail link for PERS website
PERS: http://oregon.gov/PERS PERS Insurance: http://pershealth.com IAP account: https://iap.csplans.com
Toll-free telephone number PERS
1-888-320-7377 or 503-598-7377 PERS Insurance
1-800-768-7377 or 503-224-7377 PERS and financial education
http://oregon.gov/PERS
More Resources
Attend additional PERS presentations PERS: http://oregon.gov/PERS
Individual meeting Retirement Application Assistance Session Within 90 days of retirement PERS: http://oregon.gov/PERS 1-888-320-7377 or 503-598-7377
Thank you for attending this presentation!
Background Purchase (8 Units)
Read Pre-Retirement Guide Employee cost = $4,000 Employer match = $4,000
Benefits $160 per month from age 60-65 Less if over more than 60 months No COLA increases Separate unit application forms
Police and Fire Units
Benefit 25% of Refund Annuity benefit
OR 25% of Option 1 benefit (Lump Sum)
Beneficiary Surviving spouse
OR Dependent children under 18
Surviving Spouse Benefit - P&F
457b Deferred CompensationMark Becker, Retirement Plans Specialist – ICMASarah Wood-Snapp, Retirement Plan Counselor – Great West
Retirement Services Importance of contributing to deferred compensation plan
• Best to start early but never too late! Annual Maximum
• 2013 standard maximum contribution: $17,500 Contribution catch-up provisions
• An additional $5,500 for participants aged 50+ for a maximum of $23,000
• In some cases a participant may defer up to $35,000 a year in the final three years before retirement.
Beneficiary changes
Retirement Countdown: 1 Year
457b Deferred Compensation cont. Distribution Options
• Most common are monthly installments, partial, or total lump sum
• Know the tax implications of withdrawals
Changing Contribution Amounts• Must allow at least 1 month lead time in order to have
any funds from final check diverted to Deferred Comp Plan (i.e. vacation pay-out)
PERS is now requiring you to do something with your IAP account at retirement. This can easily be rolled into the Deferred Compensation and will not be a taxable event.
Individual Meetings• Each 457 Plan Provider are available to work with
employees on their individual situations• Schedule appointments by calling HR at x 8606.
Retirement Countdown: 1 Year
457b Deferred CompensationMark Becker, Retirement Plans Specialist – ICMASarah Wood-Snapp, Retirement Plan Counselor – Great West
Retirement Services Importance of contributing to deferred compensation plan
• Best to start early but never too late! Annual Maximum
• 2013 standard maximum contribution: $17,500 Contribution catch-up provisions
• An additional $5,500 for participants aged 50+ for a maximum of $23,000
• In some cases a participant may defer up to $35,000 a year in the final three years before retirement.
Beneficiary changes
Retirement Countdown: 1 Year
457b Deferred Compensation cont. Distribution Options
• Most common are monthly installments, partial, or total lump sum
• Know the tax implications of withdrawals
Changing Contribution Amounts• Must allow at least 1 month lead time in order to have
any funds from final check diverted to Deferred Comp Plan (i.e. vacation pay-out)
PERS is now requiring you to do something with your IAP account at retirement. This can easily be rolled into the Deferred Compensation and will not be a taxable event.
Individual Meetings• Each 457 Plan Provider are available to work with
employees on their individual situations• Schedule appointments by calling HR at x 8606.
Retirement Countdown: 1 Year
Retirement Healthcare
Retirement Countdown: 1 Year
Washington County Retiree/COBRA End of Active Employee Coverage:
• Your healthcare coverage through Washington County will end on the last day of the month in which you end employment.
• Example: Retire date is July 15, your healthcare coverage terminates on July 31.
Continuation available for Medical, Dental, Vision, EAP, and Health Flexible Spending Account
Retiree or COBRA coverage available through Washington County.
Retiree/COBRA coverage is identical to active employee healthcare plans.
Retirement Countdown: 1 Year
Federal COBRA statute requires continuation coverage to be offered to covered employees, their spouses, their former spouses, and their dependent children when group health coverage would otherwise belost due to certain specific events.
Oregon state law requires continuation coverage to be offered toPERS eligible retirees, their spouses, their former spouses, and their dependent children (Retiree coverage).
The main differences between COBRA and Retiree coverage are outlined below:
Retirement Countdown: 1 Year
Retiree COBRAEligibility Eligible for PERS
retirementLoss of coverage due to qualifying event
Length Until Medicare eligibility at age 65
Generally 18 months
Cost 100% of premium 100% of premium + 2% admin fee
Retirement Countdown: 1 Year
You are responsible for monthly premiums to continue your coverage for yourself and/or dependents on County Retiree/COBRA coverage.• You may “separate” the healthcare options, and pay for only what
you need. Upon separation, and if you elect to continue with WA County
coverage, you can continue with your currently selected carriers(Providence/Kaiser).• Just as an active employee, retiree members have the opportunity to
change plans with the annual Open Enrollment period. Retiree Rates and Plans for Plan Year 2012 - 2013 are as follows:
Rates are subject to change
$839.05$822.60Individual + Child(ren)
Kaiser
$883.23$865.91Individual + Child(ren)Providence
Providers
Level of Coverage Retiree Premium Amounts
COBRA Premium Amounts
Individual $481.05 $490.67
Individual + Spouse $962.12 $981.36
Individual + Family $1,443.19 $1,472.05
Individual $457.00 $466.14
Individual + Spouse $914.00 $932.28
Individual + Family $1,371.00 $1,398.42
Retirement Countdown: 1 Year
Retirement Countdown: 1 Year
$8.94$8.76IndividualODS Vision
$17.87$17.52Individual + Spouse
$17.87$17.52Individual + Child(ren)
$26.81$26.28Individual + Family
COBRA Premium Amounts
Retiree Premium AmountsLevel of Coverage
Providers
$137.60$134.90Individual + Family
$102.77$100.75Individual + Child(ren)
$70.48$69.10Individual + Spouse
$36.67$35.95IndividualWillamette Dental
$157.52$154.43Individual + Family
$106.96$104.86Individual + Child(ren)
$102.80$100.78Individual + Spouse
$51.92$50.90Individual
ODS Dental
If you choose not to accept Retiree/COBRA coverage through Washington County, you forfeit any future opportunity to enroll with Washington County’s coverage. • In addition, if you withdraw/discontinue or are dropped
due to non-payment, you cannot re-enroll at a later date.
Be sure to investigate various healthcare plans and options available to you.
Retirement Countdown: 1 Year
Additional Healthcare Options & Resources
PERS Health Insurance Program PERS offers various healthcare plans to all PERS retirees and
their dependents who meet the eligibility criteria. PERS offers a variety of Medicare plans, both pre-Medicare enrollment and Medicare supplement plans
A subsidy through PERS may be available for Medicare eligible retirees towards their monthly premiums.
For further information, you may contact the PERS Health Insurance Program at: (800) 768-7377 or visit their website: http://www.pershealth.com/
Retirement Countdown: 1 Year
Medicare For information regarding registering for Medicare (upon
reaching age 65), please dial 800-633-4227 – Centers for Medicare/Medicaid Services (CMS) or go to their website: http://www.medicare.gov/
Healthcare Option - Enrolling onto spouse’s plan You may wish to consider enrolling onto your spouse’s healthcare
coverage. Be aware of “Enrollment Windows” when attempting to enroll
onto spouse’s coverage. Many plans allow for a short period of time for enrollment (usually 30 – 31 days) due to a Qualifying Event. If you miss this period, you risk losing your enrollmentrights.
Retirement Countdown: 1 Year
Healthcare Option - Private Coverage
Many healthcare insurance carriers (i.e. Providence, Kaiser, Blue Cross Blue Shield, etc.) offer a variety of individual plans. Be sure to closely evaluate various coverage's in order to assure benefits and services are appropriate for your needs.
As an active employee, be sure to allow enough time for proper enrollment process with private coverage (registering, review ofmedical records, etc.) and receive written approval from privateinsurance carrier before your Retiree/COBRA election window lapses.
A HIPAA Creditable Coverage Certification from current healthcare insurance carrier may be required by new carrier in order to successfully enroll. This document comes directly fromthe carrier.
Retirement Countdown: 1 Year
Additional Resources - Senior Health Insurance Benefits Assistance Program (SHIBA)
SHIBA is a state volunteer network which can provide all Oregonians education and assistance regarding Medicare and Medicare supplement plans.
There is no charge for these services.
To receive assistance you may contact SHIBA at 800-722-4134 or you may go to their website:
www.oregonshiba.org
Retirement Countdown: 1 Year
Life Insurance Coverage
It is important to review your current coverage level prior to separation, and then determine your “need amount”upon retirement.
The life insurance coverage provided by Washington County will terminate at the end of the month in which you separate from Washington County.
County-paid life insurance coverage may be converted to an individual policy. There are strict deadlines which apply when requesting conversion of coverage. You have 31 days from date of termination of coverage to apply for Conversion Coverage.• Application for Conversion Coverage is mailed with
Retiree/COBRA materials upon separation.
Retirement Countdown: 1 Year
Life Insurance Coverage, con’t.
• Conversion coverage allows you the option to “convert”your current employer-paid group coverage to an individual life policy.
Voluntary life insurance coverage (employee-paid premiums) for yourself and your dependents, may continued as an individual policy (Portability) as well.• Portability can be defined as the opportunity to purchase up
to the current amount of voluntary life insurance at current group rates.
• Rates are still subject to age-band increases
Retirement Countdown: 1 Year
Life Insurance Coverage, con’t. Please be aware that all life insurance policies through
Washington County have a Life Reduction clause. Benefits are reduced once a certain age threshold has been reached. Please see the Washington County website, under Human Resources to view each Group Insurance Certificate for each employee group.
Age Percentage In-Force
70 - 74 65%
75 - 79 45%
80 - 84 30%
85 - 89 20%
90 - 94 15%
95 or over 10%
Retirement Countdown: 1 Year
Benefit Team ContactsBenefits Information Line – x8686
Kimberly Trask, Benefits Supervisorx3740
Tracy Kittler, Benefits Specialistx4523
Lee Lamirault, Benefits Specialistx8285
Retirement Countdown: 1 Year
Retirement means no pressure, no stress, no heartache... unless you
play golf. ~ Gene Perret
Retirement Countdown: 1 Year