Tag Archives: retirement

The Economic Power of NYSLRS Retirees

Before they leave the workforce, NYSLRS retirees build careers based — at least in part — on serving the people of New York. They are police officers, firefighters and nurses. They are the countless civil servants working each day to keep government services functioning. Their contributions don’t end with retirement. In fact, NYSLRS retirees and their pensions contribute significantly to the communities where they live.

Seventy-eight percent of NYSLRS retirees and their beneficiaries (355,028 as of March 2017) stay right here in New York. They live throughout the state — from Long Island to the North Country, from the Capital District to Western New York and down to the Southern Tier. Altogether, they’re 1.8 percent of our state’s population, but in some areas, they account for more than 5 percent of the residents.

NYSRLS Retirees contribute a lot of money to New York State

Retirees’ contribute in New York State

This large population with steady sources of income has a significant and positive impact on our state and local economies. In 2016 alone, NYSLRS retirees were responsible for $11.8 billion in economic activity in New York State:

  • Property taxes. In 2016, retirees paid $1.7 billion in real property taxes. That’s 3.2 percent of the total collected for the entire state.
  • State and local sales taxes. NYSLRS retirees paid an estimated $618 million in state and local sales tax in 2016.
  • Job creators. Some retirees do go on to start small businesses as a second act. However, all NYSLRS retirees spend at least some of their income to the benefit of local businesses, and they are responsible for an estimated 72,370 jobs as a result.

Remember: 75 percent of the pension benefits that make all of this possible comes from the investment earnings of the Common Retirement Fund (CRF), not from taxpayers.

Retirees’ contribute nationwide

Are these statistics impressive? Yes. Surprising? They shouldn’t be. According to research from the National Institute on Retirement Security (NIRS), defined benefit pensions, like those provided by NYSLRS, are responsible for substantial economic gains throughout the U.S. — an incredible $1.2 trillion in total economic output nationwide.

Pensions give retirees a stable source of income, and, in return, retirees support our national and local economies with jobs, incomes, and tax revenue.

Can I Change My Beneficiary After I Retire?

That depends. Some beneficiary decisions are irrevocable, while others can be changed at any time.

Some options, such as Five Year and Ten Year Certain, allow you to change your beneficiary after you retire. But if you choose an option that provides a lifetime benefit to a survivor, you cannot change your beneficiary even if your beneficiary dies before you do. For details, visit the Payment Option Descriptions page on our website.

But there are other possible death benefits for which NYSLRS retirees can name beneficiaries. Available death benefits and eligibility requirements vary by tier and retirement plan. You can find your retirement plan information on our Publications page.

NYSLRS retirees may have up to three types of death benefits that could provide a benefit for a beneficiary: pension payment option, survivor's benefit, and post-retirement death benefit.

When you retire, you must choose a payment option for your NYSLRS pension. If your choice is Single Life Allowance, there is no pension beneficiary. But other payment options provide a reduced monthly benefit in exchange for a possible payment to a beneficiary after the retiree’s death.

If you were employed by New York State, you may be eligible for a survivor’s benefit of up to $3,000. You do not need to sign up for this benefit; you are automatically enrolled if you are eligible. If you choose a pension payment option with a beneficiary, that person will also be the beneficiary for your survivor’s benefit. If your beneficiary dies before you do, you may select someone else as beneficiary for the survivor’s benefit. If you choose the Single Life Allowance option, you must name a beneficiary for your survivor’s benefit, and you may change this designation at any time.

What about after Retirement?

You may also be eligible for a post-retirement death benefit, which would be a percentage of the death benefit that was payable at retirement. (This benefit is generally not available to Tier 1 members or members in special retirement plans that allow for retirement after 20 or 25 years of service, regardless of age.) The beneficiary of your post-retirement death benefit does not have to be the same as your pension payment-option beneficiary. And you can change the beneficiary designation for your death benefit at any time.

The easiest way to check and update your beneficiary information for the post-retirement death benefit is with Retirement Online. You can also change your beneficiary by submitting a Designation of Beneficiary (RS5127) form.

Divorced? Some things to consider

Please note: If you are divorced, you may be required to choose a retirement option that provides continuing benefits to your ex-spouse after your death. Also, the beneficiary designation for certain benefits, including the survivor’s benefit, can be revoked when a divorce becomes final. For more information, please read the publication Divorce and Your Benefits on our website.

Top Five Pre-Retirement Goals for NYSLRS Members in 2018

January is a great time to set goals for the coming year. And setting pre-retirement goals is crucial in planning for a successful retirement. Here are five goals to consider for 2018:

Plan ahead for retirement

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. An important part of developing a savings plan is to start early. The sooner you start saving, the more time your money has to grow. Check out our Weekly Investment Plan chart to see how a weekly investment can grow by age 65.

2. Track your expenses and income. Tracking your current expenses for a month or two will give you a better idea of how much you’re likely to spend in retirement and how much you’ll need to supplement your pension. Use the expense and income worksheets on our website to create a retirement budget. Be sure to include periodic expenses, such as car insurance and property taxes.

3. Request a pension estimate. If you’re within 18 months of your anticipated retirement date, it’s a good idea to request an estimate of what your retirement benefit will be. You can do this by sending us an email using our secure contact form or by calling 1-866-805-0990 (518-474-7736 in the Albany, NY area). If you are not certain that you’ve received credit for all your public service in New York State, you can submit a Request for Estimate form (RS6030) and be sure to provide detailed information about your public employment in section eight of the form. If your planned retirement date is farther away, you may want to use our online Benefit Calculator. This estimates your pension based on information you provide, so have your Member Annual Statement handy before you start, or sign in to your Retirement Online account to check your current service credit.

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

5. Consider seeking the advice of a financial planner. Financial planners don’t manage your money, but can help you assess your present financial condition and develop a practical plan to meet your specific goals and needs. Also consider doing your own research by seeking Do-It-Yourself financial planning guides on the web.

If you ever have any retirement-related questions, please contact us.

How To Keep Your NYSLRS Records Up-to-date

Whether you joined NYSLRS  recently or are preparing to retire, accurate records are essential. To make sure that your records are ready when you are, it’s important to check and update your NYSLRS account details. Here’s how:

  • Sign in to Retirement Online. It’s a convenient and secure way to review your records for personal details, contact information, designated beneficiaries and more. In many cases, you can use Retirement Online to make changes instead of sending forms through the mail or calling NYSLRS.
  • Review your Member Annual Statement (MAS). Each summer, your MAS offers an overview of your retirement account. Check it over carefully to make sure your date of birth, date of membership, service credit, earnings and other details are correct.

Be sure to contact us if you find any information that’s missing or incorrect. Get in touch right away:

  • When your mailing address changes. This is especially important if you leave public service before you’re eligible for retirement. With your correct address on file, we’ll be able to keep you informed about your benefits. The fastest and easiest way to update your address is to sign in to Retirement Online and make the change, or you can send us a completed Change of Address form (RS5512), though this process will take longer.
  • When you find a date-of-birth error. If your date of birth is wrong on any paperwork that we send you, we need to know. Please send us a photocopy of documentation showing your correct date of birth (such as a copy of your birth certificate). You can attach it to an email using our secure contact form, or write to our Member and Employer Services Bureau Registration Unit at 110 State Street, 5th Floor, Albany NY 12244-0001.
  • When you change your name. You can change your name in our records by submitting a Name Change Notice form (RS5483). If a court order was necessary for your name change, you’ll need to include a copy of the order.
  • When you want to select or change your beneficiaries. Sign in to Retirement Online and click Update My Beneficiaries. Retirement Online is the fastest way to get the job done. But, you can also complete a Designation of Beneficiary form (RS5127) and send it to us.

 

Generational Attitudes about Retirement

Attitudes about retirement vary from one generation to the next.

That stands to reason. For Millennials (those born from 1979–2000), retirement is a long way off. For Generation X (born 1965–1978), retirement isn’t too far down the road, while millions of Baby Boomers (born 1946–1964) are already retired.

Generational Attitudes on RetirementA number of recent studies have tracked generational differences concerning retirement, but they also show a substantial amount of agreement among the generations. Surveys show that a majority of workers, regardless of generation, are saving for retirement. But Millennials appear to be outperforming members of the older generations on that count. They tend to start saving early and are on track to outpace Boomers and Gen Xers in building retirement nest eggs.

Concerns about Social Security are high across generations, with many fearing that it won’t be there for them when it comes time for them to retire. (That fear is reasonable, though perhaps exaggerated, based on Social Security Administration projections.)

Social Security’s troubles, plus the general decline of defined-benefit pensions, has left many feeling that they are on their own. According to one report, two-thirds of both Millennials and Gen-Xers expect their retirement savings accounts to be their primary source of income after they stop working.

The take away for NYSLRS members? The cross-generational anxiety about retirement underscore the important role that a defined-benefit retirement plan, such as your NYSLRS retirement plan, plays in securing your financial future. It also reinforces the importance of saving for retirement.

Retirement on the Horizon? Here Are a Few Things to Think About

Things to think aboutYou’re probably looking forward to the day when you file your application for a NYSLRS pension. But before you retire, there are a few questions you should ask yourself. After all, by filing for retirement, you’re making critical decisions about your financial future. And once you’ve retired, some of those decisions will be irrevocable. Whether your planned retirement date is just around the corner or a few years off, this checklist could help you avoid costly mistakes.

Do I have all the service credit I think I have?
Under some retirement plans, service milestones (20 years, 30 years, full retirement age) can have a big impact on the amount of your benefit. If you’re aiming for one of these milestones, but retire just short of reaching it, your pension will take a big hit. To make sure you have enough service credit on your planned retirement date, sign in to Retirement Online to see how much service credit you currently have. You can also file a Request for Estimate form or talk with an information representative at our Contact Center (1-866-805-0990 or 518-474-7736 in the Albany, New York area).

Do I have previous service credit I want to purchase?
You may be able to buy credit for previous public employment or military service, which in most cases would increase your pension. But you can’t purchase service credit after you retire. You can use the “Information about Your Public Employment” section of the Request for Estimate form to request credit for previous public and military service. Read our booklet, Service Credit for Tiers 2 through 6, for more information.

Do you have a balance on a NYSLRS loan?
You cannot pay off your NYSLRS loan after you retire. If you retire with an outstanding balance, your pension will be permanently reduced. You can check your loan balance with Retirement Online or through our automated phone system. Call the toll-free number (above), then press 3 for members, 1 or 2 for the Employees’ Retirement System or the Police and Fire Retirement System, and 1 for loan services. If your retirement is still a few years away, you can increase your payroll deductions or send in extra payments to pay off your loan.

Am I ready to retire?
Are you really ready? The fact that you can retire doesn’t necessarily mean you should. Am I financially prepared? Am I psychologically ready for retirement? These are questions you’ll have to answer for yourself, but there are resources available:

Where in New York are NYSLRS Retirees?

NYSLRS retirees tend to stay in New York, where their pensions are exempt from State and local income taxes. In fact, 78 percent of NYSLRS 452,455 retirees and beneficiaries lived in the State as of March 31, 2017. And half of them lived in just ten of New York’s 62 counties.

So where in New York do these retirees call home? Well, there are a lot of NYSLRS retirees and beneficiaries on Long Island. Suffolk and Nassau counties are home to more than 57,000 recipients of NYSLRS retirement benefits, with annual pension payments exceeding $1.8 billion. But that shouldn’t be surprising. Suffolk and Nassau counties are, respectively, the largest and third largest counties in the State outside of New York City.Erie County, which includes Buffalo, ranks No. 2 in the number of NYSLRS retirees, with nearly 30,000. Albany County, home to the State Capital, ranks fourth with more than 18,000. Monroe, Westchester, Onondaga, Saratoga, Dutchess and Orange counties round out the Top Ten.

This distribution is easy to understand. The Top Ten counties for retirees include nine of the ten most populous New York counties outside of New York City. (The City, which has its own retirement system for municipal employees, police and firefighters, has about 22,000 NYSLRS retirees and beneficiaries living in its five counties.)

All told, NYSLRS retirees received $5 billion in retirement benefits in the Top Ten counties, and $9.1 billion statewide.

Hamilton County had the fewest NYSLRS benefit recipients. But in this sparsely populated county in the heart of the Adirondacks, those 435 retirees represent nearly 10 percent of the county population. $8.6 million in retirement benefits were paid to NYSLRS retirees in Hamilton County during fiscal year 2016-2017.

Outside of New York, Florida remained the top choice for NYSLRS retirees, with more than 36,000 benefit recipients. North Carolina (8,693), New Jersey (7,466) and South Carolina (5,620) were also popular. There were 690 NYSLRS recipients living outside the United States as of March 31, 2017.

Age Milestones for Retirement Planning

Age Milestones for Retirement PlanningWhether you’re 22 or 52, you should be planning for retirement.

NYSLRS retirement benefits are based on tier status, years of service, and average salary. Age is also an important number, and not just the age when you plan to retire. Here are some age milestones to keep in mind while planning for your retirement.

Under 50: It’s never too early to start saving for retirement. Even modest savings can add up over time as investment returns grow and interest compounds.

50: The Age 50 and Over Catch-Up provision allows you to save more pre-tax dollars in a retirement account starting in the calendar year in which you turn 50.

55: The earliest age most NYSLRS members can retire. (Does not apply to members in special retirement plans.) Your pension may be permanently reduced if you retire at 55.

59½: The age you can draw down money from a tax-deferred retirement savings plan, such as an IRA, without facing a potential federal tax penalty. (The penalty does not apply to New York State Deferred Compensation savings if you are retired or have left public service.)

62: Full service retirement age for Tiers 2, 3, 4 and 5 and PFRS Tier 6. Earliest age you can begin collecting a Social Security pension, but the benefit would be reduced. For more information, read When to Start Receiving Retirement Benefits.

63: Full retirement age for ERS Tier 6 members.

65: Age most people are eligible for Medicare benefits.

66: Full Social Security retirement age if you were born from 1943 through 1954. Add two months for each year from 1955 through 1959.

67: Full Social Security age if you were born in 1960 or later.

70: If you do not take your Social Security benefit at full retirement age, your benefit will increase each year until you reach age 70. Delaying Social Security after 70 will not increase your benefit.

70½: If you have tax-deferred retirement savings and are no longer working, you must begin withdrawing some of this money after you turn 70½.

One Last Number: Having a rough idea of your life expectancy is essential to retirement planning.

For more information about retirement planning, read our publication Straight Talk About Financial Planning For Your Retirement.

Know Your Benefits: Disability Retirements

Many of us dream about retirement, but not one of us pictures leaving the workplace because we can’t perform our duties anymore. Yet the truth is debilitating medical conditions do happen. Though we hope you never have to use them, NYSLRS members have certain benefits available should you become permanently disabled from performing the duties of your job.

This post is an overview of common disability benefits and how to file for them. It is important to review your retirement plan booklet for specific benefit and eligibility information, and contact us with any questions you have, before you file an application.

Disability Retirements

Benefits

Most members are eligible for what’s called an ordinary disability retirement benefit. Usually, it provides whichever is greater:

  1. 1.66 percent of your final average salary (FAS) for each year of credited service; or
  2. 1.66 percent of your FAS for each year of credited service, plus 1.66 percent of your FAS for each year of service you might have earned before age 60, up to one-third of your FAS.

To qualify for an Article 15 disability retirement benefit, you must have at least ten years of credited service, unless your disability results from an accident you sustain on the job. If your disability results from an on-the-job accident, not due to your own willful negligence, there is no minimum service requirement.

Some members have plans that may provide an accidental disability retirement benefit. The benefit amount varies depending on your system (Employees Retirement System or Police and Fire Retirement System), tier and plan. It’s a lifetime benefit, but may be reduced by amounts received from workers’ compensation or Social Security. There is no minimum service requirement for an accidental disability retirement.

“Accident” has a special meaning when used in connection with Retirement System disability benefits. Whether an incident is an “accident” is determined on a case by case basis, using court decisions for guidance.

Members of the Police and Fire Retirement System as well as some members of the Employees Retirement System, such as sheriffs and correctional officers, may be entitled to a performance-of-duty disability benefit. The benefit amount and eligibility requirements vary depending on your system, tier and plan.

Filing

You, your employer, or someone you authorize may file a disability application on your behalf. If you think you might be eligible for a disability retirement, you may want to file your application sooner, rather than later, because there are strict filing deadlines that must be met. If you meet the requirements for a service retirement too, you can apply for both at the same time. If your disability application is approved, you will be able to choose which benefit you accept.

World Trade Center Presumption

If you participated in World Trade Center rescue, recovery or clean-up operations, you may be eligible to apply for a benefit under the World Trade Center Presumption Law. The deadline for members to file a notice with NYSLRS has been extended to September 11, 2018.

Resources/More Information

For specific benefit and eligibility information, be sure to read your retirement plan booklet on our Publications page. Also, check out our Disability Retirements page and our VO1802 Life Changes: Applying for Disability Retirement booklet. You can reach our Call Center by email using our secure contact form or toll-free at 1-866-805-0990 (518-474-7736 in the Albany, New York area).

Know Your Benefits: Leaving Public Employment

It may never come up, but, you should know what would happen with your NYSLRS membership and benefits if you ever leave public employment. Even if you no longer work for a New York public employer, you’d still be a NYSLRS member. Depending on your circumstances, that membership may come with certain benefits and responsibilities.

What Happens to My Contributions If I Leave Public Employment?

If you have less than ten years of service credit, you can end your membership and request a refund of your contributions by filing a Withdrawal Application (RS5014).

If you have not earned enough service credit to be vested (eligible for a retirement benefit) and don’t withdraw your contributions, they will continue to earn 5 percent interest for seven years. At that point, if you are still off the public payroll, by law, your membership ends automatically, and your contributions will be deposited into a non-interest-bearing account. (Your contributions are not automatically refunded.)

If you are vested, your contributions will remain on deposit with NYSLRS, and when you reach retirement age, you’ll be eligible to apply for a retirement benefit.

Leaving Public Employment

How Will Leaving Public Employment Affect My Death Benefits?

If you have at least ten years of service credit before you leave, 50 percent of your death benefit may still be payable when you die. With less than ten years of service credit, the 50 percent death benefit is only payable if you die within one year of leaving public service.

How Can I Pay Back My Outstanding Loans?

If you have an outstanding NYSLRS loan, you must still make payments directly to NYSLRS at least once every three months. You must repay your loan within five years of the date it was issued, or you will default on the loan. Defaulting on a loan may carry considerable tax consequences: You’ll need to pay ordinary income tax and possibly an additional 10 percent penalty on the taxable portion of the loan. Once you’ve left public employment, you aren’t eligible to take a NYSLRS loan.

How Can I Stay Informed About My Membership If I Leave Public Employment?

If you leave public employment, but haven’t ended your NYSLRS membership, you’ll still:

Beyond staying informed, you’ll need to keep your membership information up to date:

  • Keep your beneficiary information current, and
  • Let us know about any name or address changes (for either you or your beneficiaries).

Finally, it’s your responsibility to file an Application for Service Retirement (RS6037) when you are eligible to retire — we will not pay out a retirement benefit unless you apply for it.

For more information, read our Life Changes: What if I Leave Public Employment? (VO1800) publication.