Retirement System Update
Our last meeting of NYSTRS Delegates was held in Saratoga Springs, New York on November 4 and 5. The attending delegates from Williamsville were Larry Schiro, Andy LaMont and Mark Arnold. Our main purpose for attending the meeting was to elect a teacher to the NYSTRS board of directors. There were several workshops presented on Sunday and Monday regarding NYSTRS. One dealt with the breakdown of the financial health of the Teacher Retirement System. Our system is in excellent financial health now and will continue to be in the future. Currently the five-year projection of investments is underperforming expectations thus, school districts and municipalities are being hit with larger pension contribution costs. However, the tenyear performance projection is in good shape and once the five-year projection is corrected, things should calm down. This fluctuation in performance continues due to the aftermath of the recession of 2008. Presently, the long-term health of the system is good. NYSTRS is one of the most secure public pension systems in the country.
The TRS is sending out your annual Retirement Benefits Profile. They started to mail them out in Mid –November through December. If you haven’t received yours to date, please contact NYSTRS.ORG or call them at (800) 348-7298. It is important to check out your service and salary credit from last school year (2011-12). Make sure you have been credited with the proper number of total years of service. You can check that by comparing last year’s to this year’s numbers.
Many teachers are not aware that they have a death benefit and disability benefit as part of their membership to the Teacher Retirement System. Also, note that each member has a disability benefit amount listed. Teachers who are eligible to retire but become disabled can collect the higher of the two benefits. Also, note that you have a life insurance benefit should you die while in service. Check your beneficiary(s) especially if you have had any changes in your life such as marriage, divorce, death, or birth of a child. If you pass away and your beneficiary list has not been kept current, your retirement benefits may end up with someone from your past. Current spouses and children could be excluded. Your beneficiary list cannot be changed after your death. The TRS cited a case last year where a teacher had listed his ex-wife as beneficiary upon his death. He remarried, never changed the beneficiary and died in service. Wife number one received the death benefit. Wife number two received nothing. No provisions were made for this member’s second wife.
NYSTRS is recommending that everyone set up an online account called MYNYSTRS. Go to NYSTRS.org and set up your account. You need your NYSTRS number (it is on your weekly paycheck check). It takes about five minutes to set up this account. You will have access to all your TRS information immediately. TRS will also ask you if you want to receive your annual benefit profile and all other communications electronically to save paper and postage.
Spend some time perusing this website. There are some benefits that many members may not know about. The following are important features regarding our retirement system:
• Anyone with 10 years of NYSTRS membership (Tiers 3 and 4 only) should no longer be paying his or her 3% mandatory contribution. If you have any questions contact NYSTRS.ORG.
• Many members may be eligible for prior service credit for substitute teaching or working for any government agency (except Federal Government). Go to NYSTRS.ORG and download a prior service credit form, fill it out and mail it in. You may also do this electronically if you have a MYNYSTRS account. Do this now!! Memory fades and records are harder to find the longer you wait to do this. You can also buy military credit if you served in the armed forces.
• Lastly, regarding prior service credit, if you are claiming substitute teaching time, check with TRS so that the school district you subbed in reported the days worked. Some schools reported earnings not days. The TRS will divide the earnings by a statewide average per diem pay and you may not be credited with the correct days of service. There was one teacher in another district who subbed over a two-year time period. Her days of prior service credit amounted to two months. When it was noted at a TRS video conference of the way her time was reported, she refilled a prior service claim asking that the days be reported and not her earnings. She received 4 additional months of credit, which gave her 6 months of substitute credit. Remember that twenty days of subbing equal one month of service, nine months of credit equals one year of service. Don’t delay. This is an important action to take to expedite the updating of your service work history.
• New Tiers 5 and 6 are now fully active. The benefits in Tiers 5 and 6 are somewhat different than Tiers 1-4. One of the most significant factors is that members must contribute for life and may not retire until age 62. While it may seem unfair, a defined benefit pension is still significantly better than the defined contribution system that most people have recently been forced into joining. An example of a defined contribution program is a 401k. This was how Governor Cuomo has rectified the high cost of NY State Pensions. Perhaps, down the road changes may be added to improve the benefits for Tiers 5 and 6 members. When Tier 3 was initially enacted, the benefits were so punitive that people retiring under Tier 3 legislation were severely affected. As the economic climate improved over the years, changes were made to allow Tier 3 members to retire under Tier 4 regulations. The mandatory lifelong 3% contribution is now capped at 10 years of membership for Tiers 3 and 4.
• There are NO retirement incentives on the docket. That can change if the governor finds a need to flush out Tiers 1-4 members.
As the NYSTRS has done with its services, Social Security has made using their online tools easy and worthwhile. Here are a few of the things available to you online: estimate your future benefits, apply for benefits, or if you currently receive benefits, sign up for direct deposit! Simply go to www.socialsecurity.gov and get the information you need! If you are younger than 62, you may not think that Social Security is relevant to your current situation. However, it is important to check your Social Security Profile at any age to ensure that your salary is correctly reported. Did you know if you were to die, your minor children would be covered and receive monthly income?
You also have disability coverage if you become disabled while in service. Once again go to the social security web site for further information.