Monthly Archives: December 2014

Top Five Pre-Retirement Goals For NYSLRS Members in 2015

This is the time of year when people set goals for themselves. At the New York State & Local Retirement System (NYSLRS), we believe in setting realistic financial goals, especially when it comes to preparing for retirement. Here are five goals we think you can achieve in 2015:

  1. Choose a sensible savings plan that works for you. There are several ways to save for retirement, including starting a deferred compensation plan like the New York State Deferred Compensation Plan. The most important part of developing a savings plan is to start early. The sooner you start saving, the more time your money has to grow. And if you’re nearing retirement age, “binge saving” is always an option worth considering. Check out our Weekly Investment Plan to see how making a weekly investment can grow by age 65.

  2. Track your current and future monthly expenses and income. We feature worksheets to help you prepare a post-retirement budget on our website. Keep track of what you spend now for a month or two to get an idea of how you spend your money. You should include periodic expenses, such as car insurance payments, or property and school taxes as well. Use another of our worksheets to help you summarize your current monthly income and estimate your post-retirement monthly income. Having a post-retirement budget can help you decide how to spend money in retirement, and if you’ll need to supplement your pension.

  3. Request a NYSLRS retirement estimate. A NYSLRS retirement estimate provides you with an estimation of what your pension could be based on the information we have on file for you. You should request an estimate 18 months before your anticipated date of retirement. Many members don’t request an estimate because they don’t know their exact retirement date, but don’t let that stop you. It’s a good way to determine how retirement ready you are. At the very least, you should use our online Benefit Calculator to estimate your pension based on information you enter. Have your Member Annual Statement handy to help fill in key information.

  4. Pay off your NYSLRS loans, if you have any. An outstanding loan balance at retirement will permanently reduce your NYSLRS retirement benefit. You cannot make loan payments after you retire, and the reduction does not go away after we recover the funds. Visit our website for information about making additional payments or increasing your loan payment amount.

  5. Consult a financial planner or accountant. Financial planners don’t manage your money, but will assess your present financial condition and develop a practical plan to meet your specific goal and needs.

If you ever have any retirement-related questions, please contact us. And Happy New Year!

If You’re Proud of the Work Public Servants Do, We Want to Hear from You

Know a NYSLRS member or retiree whose public service story should be told? Let us know.

The New York State and Local Retirement System (NYSLRS) has more than 600,000 members and 400,000 retirees. And every one of them has a story to tell.

NYSLRS is a public retirement system full of stories. Stories about hardworking public servants finding value and meaning in the work they do, especially when they help another New Yorker. They’re the stories that you may not hear about, because to some, they’re just doing their job.

Profiles in Public Service

Next year, we’re going to recognize the public service of our NYSLRS membership with a new video series. This series will spotlight the good work some of our members are doing for New York State, in a variety of positions and responsibilities you may not be aware of. We’ll also highlight public service retirees, because after a career of working for the people of New York, many NYSLRS retirees still give back to their communities as mentors, volunteers and supporters of charitable causes.

Submit a Name, and Story

Do you know someone who fits the bill? They may be a co-worker, friend or family member. Maybe you don’t have to look farther than your own mirror. The people who we’d like to know about are proud of their work helping others. It could be the municipal worker who plows your snowy street at 3am, or the town clerk who also volunteers at the local animal shelter. Or the retired cop or fireman who, after years of protecting the public, now operates an organic farm cooperative. You get the idea.

In short, we’re looking for the unsung heroes of the public sector whose work positively affects, or has affected, the people New York State. And we want to share their stories right here in the New York Retirement News blog.

Use the comment field for this blog post to submit the name of the person you’d like to nominate and include a very brief description of the public service story you think should be told about that person. We’ll get back to you to gather more details. Of course, not every name nominated will have their story told, but we’ll do our best to tell as many stories as possible.

We look forward to hearing your recommendations.

Advice on Advance Payments

After you retire, we start calculating the amount of your final retirement benefit. This means you won’t receive your full pension payment right away. It often takes time for your former employer to provide us the specific information we need to determine your final retirement benefit, such as your employer’s certification of your unused vacation and sick leave credits. So, for the first few months of your retirement, your first payments will be advance payments.

What Are Advance Payments?

Advance payments are based on your most recent NYSLRS retirement estimate. They provide up to 95 percent of the retirement option you elected. You’ll continue to receive advance payments until we finalize your benefit. Currently, our pension calculations can take up to five months to complete, though every case is different; if we requested more information from you or your employer, it may lengthen the amount of time it takes to complete your retirement case.

Advance payments are always paid via check and are mailed to the address we have on file for you. Make sure we have the correct address for you when you retire.

When Can I Expect My First Advance Payment?

The month you retire determines when advance payments would start. The table below shows the schedule of mailing days for a new retiree’s first advance payment.

Date of Retirement Date First Advance Payment is Mailed
January 1-31 1st business day of March
February 1-28 (29) 1st business day of April
March 1-31 1st business day of May
April 1-30 1st business day of June
May 1-31 1st business day of July
June 1-30 1st business day of August
July 1-31 1st business day of September
August 1-31 1st business day of October
September 1-30 1st business day of November
October 1-31 1st business day of December
November 1-30 1st business day of January
December 1-31 1st business day of February

What Happens Once My Pension is Finalized?

Once your monthly pension is finalized, we’ll send you a retroactive payment to make up the difference between the advance payments you’ve received and the amount actually due (minus federal withholding). You’ll also receive a letter explaining how we calculated your final retirement benefit, and what your final monthly benefit will be for life.

Once you receive your retroactive payment, you’re officially part of the regular pension disbursement schedule. If you signed up for direct deposit, your monthly pension payment will be deposited directly into your bank account on the last business day of the month. If you didn’t sign up for direct deposit, you’ll receive a pension check, which is mailed out on the second-to-last business day of the month.

If you have questions about what to expect once you retire, check out our Life Changes: A Guide for Retirees publication, or contact us.

Rejoining NYSLRS After Retirement

It’s a scenario you probably haven’t thought of – if you retire from public employment and later decide to go back to work in the public sector in New York, you actually have the option of rejoining the New York State & Local Retirement System (NYSLRS). However, the Retirement and Social Security Law (RSSL) regulates post-retirement employment for NYSLRS members, which could affect your pension benefits.

Active Senior Businessman Series

Note: This post applies only to service retirees of the Employees’ Retirement System (ERS) or the Police and Fire Retirement System (PFRS) who are rejoining the same System. Different information applies to:

  • Retirees of other retirement systems
  • Persons joining a different retirement system than the one they retired from
  • Disability retirees

Rejoining NYSLRS

First, it’s important to know that you don’t have to rejoin NYSLRS. But if you do, Tier 3, 4, 5 and 6 retirees may rejoin immediately and return to their former tiers. As for Tier 1 and Tier 2 retirees, they must have one year of service after re-entering employment to be eligible for an active member death benefit. Deferring joining the retirement system for one year can protect you until you are eligible for the active member death benefit, meaning you would still be covered by any post-retirement death benefit and option under which you retired while in deferment. There could be a cost associated with the deferment.

Retiring Again

When you retire again, a new retirement date will be established. However, a new retirement date can:

In addition, if you have previously retired under an early retirement incentive plan enacted by the Legislature and your pension is recalculated, you would lose any incentive service included in the calculation of your original benefit.

If you’re a member of Tier 2, 3, 4, 5 or 6 and earn less than two years of service credit in your new membership, your original pension will be reinstated along with your option election and date of retirement. You won’t receive an additional benefit for the service credit earned after your return to membership. If you’re a Tier 1 member, your original pension will be reinstated and you’ll receive an additional benefit based on your service after the return to membership.

Once you earn two or more years of service credit in your new membership, you’ll have the option to receive a recalculated pension that takes into account your original service credit, the additional service credit you earned, and any increase in salary. You may also select a new option for benefit payments, if you wish.

But in order to receive a recalculated benefit that includes your additional service, you’ll have to repay, at the Single Life Allowance (Option 0) rate, the entire amount of the pension that you received when you first retired. The amount, plus interest compounded, must be repaid in either a lump sum or through installments after you have two years of service credit in the new membership and before you retire again. Interest continues to accrue compounded until the balance is paid in full. Alternatively, you could request a permanent reduction of the new pension to account for any benefits previously received. If you choose the permanent reduction, it must be done at retirement and will include interest compounded from the date you received the monies in the first retirement until your second date of retirement.

Members with two or more years of service credit who do not wish to repay previous benefits and receive a recalculated pension will have their original pension reinstated and will receive an additional benefit based on their service after the return to membership.

Where Can I Learn More About Post-Retirement Employment?

If you are seriously considering rejoining the Retirement System, we strongly urge you to contact us to discuss the matter more fully and to obtain additional information.

Since rejoining the Retirement System after returning to work may prove financially prohibitive, you might want to consult a financial advisor before making any decision. Please read our publication, Life Changes: What If I Work After Retirement?, for more information. You can also find information about Section 211 and Section 212, laws that can also affect your return to public employment.

What Unused Sick Leave at Retirement Might Mean For You

Members of the New York State and Local Retirement System (NYSLRS) may receive additional service credit for their unused, unpaid sick leave at retirement. If you’re a New York State employee, or if your employer has adopted Section 41(j) for the Employees’ Retirement System (ERS) or 341(j) for the Police and Fire Retirement System (PFRS) of the Retirement and Social Security Law, you may be eligible for this credit.

How It Works*

Your unused, unpaid sick leave may add up to 165 days (7½ months) to your service credit. The credit is calculated on a 260 annual workday basis—165 days divided by 260 days equals 7½ months—so you may receive an added credit of .63 of a year.

The additional credit for most ERS members can’t exceed 165 days. Most Tier 6 ERS members can receive up to 100 days (.38 of a year) of additional credit. For State employees in certain negotiating units, up to 200 days of unused, unpaid sick leave (.77 of a year) may be credited.

Also, depending on your employer, your unused sick leave may be used to cover some of the costs of your health insurance premiums during your retirement. (Please check with your employer for more information.)

*This section was revised on 12/5/14.

Calculation Example

If you have 130 unused, unpaid sick leave days when you retire, we would divide 130 by 260 and you would get .50 of a year, or 6 months, additional service credit.

Restrictions

While you may receive additional service credit for your sick leave under Sections 41(j) or 341(j), there are some restrictions. Credit for unused sick leave at retirement can’t be used to:

  • Qualify for vesting. For example, if you have nine years and ten months of service credit and you need ten years to be vested, your sick leave credit cannot be used to reach the ten years.
  • Qualify for a better retirement benefit calculation. For example, if you have 19¾ years of service credit, but your pension will improve substantially if you have 20 years, your sick leave credit cannot be used to reach the 20 years.
  • Increase your pension beyond the maximum amount payable under your retirement plan.
  • Meet the service credit requirement to retire under a special 20- or 25-year plan.

Check your retirement plan booklet for more information about this benefit. You can also check page 4 of your Member Annual Statement to see if this optional benefit is available to you.