Retirement Workshop (PERF & TRF)

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Retirement Workshop

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Workshop Objectives

Session I

 To understand your retirement benefit plan.

 To understand your retirement benefit options.

Session II

(Optional)

 Step by step completion of the Retirement

Application.

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The Milestones and

Your INPRS Retirement Benefit Plan

 The Milestones – PERF & TRF

Vesting

Early Retirement w/ a reduced benefit

Normal Retirement w/ a full benefit

Survivor Benefit

Disability Benefit

 Two-part Retirement Benefit Plan

 Defined Benefit (Pension)

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INPRS Retirement Benefit Plan

(PERF & TRF)

 Annuity Savings Account (ASA)

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Annuity Savings Account (ASA)

• Mandatory 3% contribution

• Always belongs to you / fully vested

• No loan or hardship withdrawals available

Defined Benefit (Pension)

• Lifetime benefit

- must meet eligibility

• Funded by employers

• Contributions not held in an individual account

• Formula calculation used to determine benefit

• Benefit determined by age, salary, service,

and retirement option chosen

What Are My Benefits?

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When Am I Eligible?

(PERF & TRF)

Normal Retirement Eligibility

1. Age 65 with 10 or more years of creditable service;

2. Age 60 with 15 or more years of creditable service;

3. Rule of 85: Minimum age 55, age plus years of service

must equal 85 or more.

For example: age 55+30 yrs= 85; or age 58+29 yrs= 87.

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Early Retirement

with a Reduced Pension

A member who has 15 or more years of creditable service, and,

is between the ages of 50 and 59 can retire with a reduced pension…

Retirement Age Percentage of Pension

50 44%

59 89%

(Percentage increases 5% per year between ages 50-59)

Please note that if you choose to take early retirement, your

pension benefits will remain at a reduced level even after you

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Collect Your Retirement

Benefit While Continuing to Work

1. Millie Morgan: Minimum age 70 with 20 or more

years of creditable service (while working in a PERF or

TRF covered position);

2. Elected officials: Minimum age 55 with 20 or more

years of creditable service (while serving in their

elected position). If the member is younger than age

60, a reduced benefit would apply unless you meet

the Rule of 85.

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Defined Benefit Formula

The monthly Pension formula is defined by state law…

(Final Average Salary x Creditable Service x 1.1%) divided by 12

Examples

(

$30,000

x

20 yrs

x

.011

)/12 = $550/month (before taxes)

(

$30,000

x

25 yrs

x

.011

)/12 = $688/Month (before taxes)

(

$35,000

x

30 yrs

x

.011

)/12 = $963/Month (before taxes)

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Final Average Salary

x

Creditable Service

x 1.1%



Creditable Service-Continuous periods of employment

in a PERF/TRF-covered position.



_{Benefit Multiplier: 1.1% (.011)}

PERF

TRF

Final Average Salary-20

highest quarters in

groups of 4 consecutive

quarters over your entire

PERF career

Final Average Salary-5

highest contract years

over your entire TRF

career

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Additional Creditable Service

 Approved paid/unpaid leave

 Military service leave

 Other service (call for eligibility)

Note: Any service previously lost, in taking an ASA

distribution prior to retiring from a PERF/TRF covered

position, is automatically reinstated six months after

taking another PERF/TRF position.

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Purchased Service

 Out of State Service

• Must have at least one year of PERF or TRF service, and

• Not eligible to claim a retirement benefit from any other retirement system or fund.

 Prior Military Service

• Must have at least one year of PERF or TRF service.

• Must have served on active duty in military for at least 6 months and received an

honorable discharge.

• Must be able to provide a DD Form 214, Certificate of Release or Discharge.

• Only 2 years of service may be purchased.

 Additional Service Credit

• 1 year for every 5 actual years

• Available to vested members only.

• * Must be currently employed in a PERF/TRF covered position to purchase any type of

service.

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Working After Retirement

*Effective July 1, 2013

 Members can no longer start a second retirement under PERF.

*To reemploy with a PERF or TRF covered employer:

 30 day mandatory separation from retirement date is required to continue receiving

PERF or TRF retirement benefits

 No additional service credit is earned

 No contributions made to ASA

 No earnings limitation

*Member’s application for retirement benefits is void if the member has an agreement,

prior to their retirement, with a covered employer to become re-employed.

*To reemploy in the private sector:

 Employable immediately

 No earnings limitation

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Retirement Benefit Options

One of the most important decisions you will make is

choosing your Defined Benefit (pension) payment option.

Remember

You will receive a monthly benefit for the rest of your life.

Before choosing an option, ask yourself the following questions:

• How much monthly income will I need after retirement?

• Do I need to plan for a beneficiary?

• If yes, how much income will my beneficiary require?

• How long will my beneficiary require this income?

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Retirement Benefit Options

Limited Beneficiary Options

 5-year Certain & Life

 Straight Life

 Cash Refund + 5-year Certain & Life

Survivorship Options

 100% Survivorship

 66 2/3% Survivorship

 50% Survivorship

Additional Option

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Retirement

Benefit Options

1. Deferral of Payment

2. Annuitization

3. Lump Sum Distribution

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PERF Benefit Estimator

Details

Information at retirement

Average salary $23,827.94

Creditable service 29.83 Annuity Contribution $27,781.88 Members age 67 Years 1 Month(s) Beneficiary age 60

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PERF Benefit Estimator

Description Estimate monthly

benefits

Beneficiary’s estimated monthly benefit (after your death)

Without ASA

With ASA Without ASA

With ASA

Five Year Guaranteed Survivor Benefit (Option 10):

You will receive a monthly benefit for the rest of your life. If you die before receiving benefit payments for five years, your beneficiary will receive that monthly benefit for the remainder of those five years OR a lump sum distribution equal to the present value of those remaining payments. After five years, there are no payments available to the beneficiary.

$651.63 $893.07 N/A N/A

Benefit with No Guarantee (Option 20):

You will receive a monthly benefit for life, but there are no monthly payments to anyone after your death. However, the balance of your Annuity Savings Account will be refunded to your beneficiary or estate if it is larger than the payments previously made to you.

$669.68 $917.80 N/A N/A

Joint with Full Survivor Benefits (Option 30):

You will be paid a monthly benefit for life. After you die, the same monthly benefit will be paid to your survivor for his/her lifetime. If your survivor is NOT your spouse, please contact PERF to make sure you are eligible to select this option.

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PERF Benefit Estimator

benefits

Without ASA

With ASA

Joint with 2/3 Survivor Benefits (Option 40):

You will be paid a monthly benefit for life. After you die, two-thirds of your monthly benefit will be paid to your survivor for his/her lifetime. If your survivor is NOT your spouse, please contact PERF to make sure you are eligible to select this option.

$501.30 $687.04 $335.87 $460.31

You will be paid a monthly benefit for life. After you die, one-half of your monthly benefit will be paid to your survivor for his/her lifetime.

$534.99 $733.21 $267.49 $366.60

Cash refund Annuity (Option 71):

In order to select this option you must choose to combine at least a portion of your ASA with your lifetime monthly pension benefit. If you select this option, you will receive a monthly benefit for the rest of your life. If you die before receiving payments for five years, your beneficiary will receive that monthly benefit for the remainder of those five years OR a lump sum equal to the present value of those remaining payments. Also, upon your death, whether you die before or after

receiving five years of benefits), your beneficiary may receive any remaining balance of your Annuity Savings Account.

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PERF Benefit Estimator

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PERF Benefit Estimator

Details

Information at retirement

Average salary $23,827.94 Creditable service 29.83 Annuity Contribution $27,781.88 1986 Tax Basis Account Balance $2,597.42

Members age 67 Years 1 Month(s)

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PERF Benefit Estimator

benefits

Without ASA

With ASA

Five Year Guaranteed Survivor Benefit (Option 10):

You will receive a monthly benefit for the rest of your life. If you die before receiving benefit payments for five years, your beneficiary will receive that monthly benefit for the remainder of those five years OR a lump sum distribution equal to the present value of those remaining payments. After five years, there are no payments available to the beneficiary.

$651.63 $893.07 N/A N/A

Benefit with No Guarantee (Option 20):

You will receive a monthly benefit for life, but there are no monthly payments to anyone after your death. However, the balance of your Annuity Savings Account will be refunded to your survivor or estate if it is larger than the payments previously made to you.

$669.68 $917.80 N/A N/A

Joint with Full Survivor Benefits (Option 30):

You will be paid a monthly benefit for life. After you die, the same monthly benefit will be paid to your survivor for his/her lifetime. If your survivor is NOT your spouse, please contact PERF to make sure you are eligible to select this option.

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PERF Benefit Estimator

benefits

Without ASA

With ASA

You will be paid a monthly benefit for life. After you die, two-thirds of your monthly benefit will be paid to your survivor for his/her lifetime. If your survivor is NOT your spouse, please contact PERF to make sure you are eligible to select this option.

$501.30 $687.04 $335.87 $460.31

You will be paid a monthly benefit for life. After you die, one-half of your monthly benefit will be paid to your survivor for his/her lifetime.

$534.99 $733.21 $267.49 $366.60

Cash refund Annuity (Option 71):

In order to select this option you must choose to combine at least a portion of your ASA with your lifetime monthly pension benefit. If you select this option, you will receive a monthly benefit for the rest of your life. If you die before receiving payments for five years, your beneficiary will receive that monthly benefit for the remainder of those five years OR a lump sum equal to the present value of those remaining payments. Also, upon your death, whether you die before or after

receiving five years of benefits), your beneficiary may receive any remaining balance of your Annuity Savings Account.

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TRF Benefit Estimator

MEMBER INFORMATION

TRF Number: 0000000 Home Telephone Number: Other Telephone Number: Date of Birth: 05/04/1957 Member Age: 57 Retirement Date: 07/01/2014

SURVIVOR INFORMATION

Name: Relationship: Date of Birth: Survivor's Age: 55

NOTICE TO MEMBERS

This estimate is based on uncertified data and does not warrant accuracy. Actual benefits are computed using certified data and laws in effect at the time of your retirement. Ten years of Indiana teaching service are

required for retirement eligibility. For survivorship options, use your primary beneficiary's date of birth, if available. Please be advised amounts are expressed in whole dollars, benefits are approximate and annual benefit payments are 95-99% taxable in the year received.

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TRF Benefit Estimator

ANNUAL-BENEFIT CALCULATION

Average Salary $66,595.00 Pension Base Amount $732.00 Years of Trf Service Credit 28.0000 Years of Perf Service Credit 0.0000 Annual Unreduced Benefit $20,511.00 Early Retirement Reduction Factor 1.0000 Annual State Pension Benefit $20,511.00 Annuity ( $71,523.00 X 0.0883 ) $6,315.00 Total Annual A-1 Benefit $26,827.00 Total Annual A-1 Benefit With Rollover Account $26,827.00

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TRF Benefit Estimator

ANNUITY ACCOUNT BALANCE

ANNUITY ACCOUNT AMOUNT

Member Contribution $4,361.00 Employer Pick-Up Contribution $31,676.00 Interest/Earnings $35,484.00 Account Balance $71,523.00

ROLLOVER ACCOUNT BALANCE

ROLLOVER ACCOUNT AMOUNT

Rollover Contribution $0.00 Interest/Earnings $0.00 Rollover Account Balance $0.00

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TRF Benefit Estimator

ASA 1 (Formerly Alt I)

Member combines the Annuity Savings Account balance with monthly Pension Pension Options Pension

Amount

Annuity Amount

Monthly Total Before Age 62 After Age 62 Survivor Benefit A-1 - 5-year

Certain & Life $1,709.00 $526.00 $2,235.00 $3,382.00 $1,582.00 A-2 - Straight Life $1,716.00 $528.00 $2,244.00 $3,391.00 $1,591.00 A-3 - Cash Refund

+ 5-year Certain & Life

$1,709.00 $513.00 $2,222.00 $3,369.00 $1,569.00 B-1 - 100% Survivorship $1,543.00 $475.00 $2,018.00 $3,049.00 $1,431.00 $2,018.00 B-2 - 66 2/3% Survivorship $1,597.00 $491.00 $2,088.00 $3,155.00 $1,480.00 $1,392.00 B-3 - 50% Survivorship $1,625.00 $500.00 $2,125.00 $3,211.00 $1,507.00 $1,062.00

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TRF Benefit Estimator

ASA 2 (Formerly Atl II-A), ASA 3 (Formerly Atl II-B), ASA 4 (Formerly Atl II-C)

Member elects to withdraw the Annuity Savings Account Balance

ASA 5 (Formerly Alt IV-A), ASA 6 (Formerly Alt IV-B)

Member defers distribution of Annuity Savings Account Balance

ASA Lump Sum Payment Amount (Withdrawal Only) = $71,523.00 Pension Options Pension

Amount

Certain & Life $1,709.00 $1,709.00 $2,856.00 $1,056.00 A-2 - Straight Life $1,716.00 $1,716.00 $2,863.00 $1,063.00 B-1 - 100% Survivorship $1,543.00 $1,543.00 $2,574.00 $956.00 $1,543.00 B-2 - 66 2/3% Survivorship $1,597.00 $1,597.00 $2,664.00 $989.00 $1,064.00 B-3 - 50% Survivorship $1,625.00 $1,625.00 $2,711.00 $1,007.00 $812.00

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TRF Benefit Estimator

ASA 7 (Formerly Alt III)

Member withdraws the 12/31/1986 Tax Basis and combines the remaining annuity

Savings Account balance with the monthly pension

Pre-86 Tax Basis Lump Sum Payment Amount = $1,465.00 Pension Options Pension

Amount

Certain & Life $1,709.00 $515.00 $2,224.00 $3,371.00 $1,5710.00 A-2 - Straight Life $1,716.00 $517.00 $2,233.00 $3,380.00 $1,580.00 A-3 - Cash Refund

+ 5-year Certain & Life

$1,709.00 $502.00 $2,211.00 $3,358.00 $1,558.00 B-1 - 100% Survivorship $1,543.00 $465.00 $2,008.00 $3,039.00 $1,421.00 $2,008.00 B-2 - 66 2/3% Survivorship $1,597.00 $481.00 $2,078.00 $3,145.00 $1,470.00 $1,385.00 B-3 - 50% Survivorship $1,625.00 $490.00 $2,115.00 $3,201.00 $1,497.00 $1,057.00

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Annuity Savings Account

Changes

 HEA 1075

 Oct. 1, 2014 to Sept. 30, 2015:

Annuities will be calculated with a 5.75

*

_{percent interest rate.}

 Oct. 1, 2015 to Dec. 31, 2016:

Annuities will be calculated at the market rate or 4.5

*

_percent,

whichever is greater.

 After Dec. 31, 2016:

Whenever the Board enters into an agreement with a third party

provider, the interest rate will be market rate.

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PERF/TRF Annuity Savings Account

Changes to Payment Options

(PERF) 7.5%

(Pre 10/1/14)

(TRF) 7.5%

(Pre 10/1/14)

(PERF & TRF) 5.75%

(10/1/14)

Annuitized Amount

Monthly

$ 10,000

$91.92

$82.30

$72.01

$ 20,000

$183.84

$164.60

$144.03

$ 30,000

$275.76

$246.90

$216.04

$ 40,000

$367.68

$329.19

$288.06

$ 50,000

$459.60

$411.49

$360.07

$ 60,000

$551.52

$493.79

$432.09

$ 70,000

$643.44

$576.09

$504.10

$ 80,000

$735.36

$658.39

$576.12

$ 90,000

$827.28

$740.69

$648.13

$ 100,000

$919.20

$822.98

$720.15

Age: 65

Option: 5 year guaranteed benefits (PERF option 10 / TRF option A-1)

This table illustrates the potential impact of annuitization changes. It is an estimate only for your general planning purposes. Your actual monthly annuity payment may vary from the data in this table.

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PERF/TRF Annuity Savings Account

Changes to Payment Options

% of Annuitized Funds Paid Out Each Year

Prior to 10/1/14

10/1/14 - 9/30/15

Age

PERF

TRF

PERF & TRF

55 9.3%

8.6%

7.2%

60 10.0%

9.1%

7.8%

65 11.0%

10.0%

8.6%

70 12.3%

11.0%

9.8%

75 14.0%

12.3%

11.4%

Option: 5 year guaranteed benefits (PERF option 10 / TRF option A-1)

This table illustrates the potential impact of annuitization changes. It is an estimate only for your general planning purposes. Your actual monthly annuity payment may vary from the data in this table.

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What’s Next?

When you are ready …

• Discuss your plans with your family.

• Consult a financial planner, tax advisor or legal expert if you have

concerns.

• Choose a retirement date that fits your goals.

• Begin collecting the documentation you’ll need to submit with

your retirement application.

• Submit your application to INPRS no later than 90 days prior to

your retirement date.

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Application Submission Dates

Submit your retirement application no later than 90 days before your retirement date

Submission

Deadline

October

November

December

January

February

March

April

May

June

July

August

September

Retirement Date

January 1

st

February 1

st

March 1

st

April 1

st

May 1

st

June 1

st

July 1

st

August 1

st

September 1

st

October 1

st

November 1

st

December 1

st

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INPRS Contact Information



Website:

www.inprs.in.gov



e-mail:

questions@inprs.in.gov



Phone:

PERF 1-888-526-1687

TRF 1-888-286-3544



Mailing address:

INPRS

1 North Capitol, Suite 001

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Application Completion

Session II

Immediately following all workshops:

• Retirement Application Completion Session

(

Most effective and efficient

)

• Group Retirement Application Completion

Session (GRACS)

• Individual Retirement Application Completion

Sessions by request regionally

(Limited availability)

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After break

Retirement Application

completion session

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