The 3-Legged Stool Approach to Retirement Confidence

Leave a reply

As a NYSLRS member, your defined benefit pension plan is a good reason to be optimistic about your finances in retirement. Once you retire, your pension will provide monthly payments for the rest of your life. But there is more to a financially secure retirement than having a pension. Understanding all your potential sources of income will help you plan for your future and boost your retirement confidence.

Think of retirement security as a three-legged stool. Each leg is a source of income to help support you when your working days are done.

3-Legged Stool Approach to Retirement Confidence

Leg 1: Your NYSLRS Pension

At retirement, vested NYSLRS members are eligible for a pension based on their final average earnings and the number of years they’ve worked in public service. Your NYSLRS pension payments will continue for the rest of your life, no matter how long you live. Unlike workers who rely on 401(k)-style retirement plans, you won’t have to worry about this income running out.

Most members can estimate their pension in Retirement Online. But, if you’re a long way from retirement, it may be better to think in terms of earnings replacement. Financial advisers estimate you’ll need to replace 70 to 80 percent of your income to retire with confidence. Your pension can help get you there. For example, if you retire with 30 years of service, your NYSLRS pension could replace more than half of your earnings. (Pension benefits depend on your tier and retirement plan. Find your retirement plan publication to learn how your retirement benefit will be calculated.)

Leg 2: Social Security

Your Social Security benefit is another source of income to help support you in retirement. At Social Security’s full retirement age, your benefit can replace from about 75 percent for lower income earners to about 27 percent for higher income earners. Learn more about Social Security benefits  and visit the Social Security’s Plan for Retirement page to estimate your income.

Leg 3: Retirement Savings Can Boost Your Confidence

A lifetime pension and Social Security income will be substantial financial assets, but it’s still important to save for retirement. Healthy retirement savings will give you more flexibility to do the things you want to do in retirement. It can also help in case of an emergency and act as a hedge against inflation.

Your savings is the retirement factor you have the most control over. You decide when to start, how much to save and how to invest your money. The key is to start saving early so your money has time to grow, even if you can only afford to save a small amount in the beginning.

Eligible employees might consider saving with the New York State Deferred Compensation Plan (NYSDCP). Money gets deducted from your paycheck, so you won’t even have to think about it. NYSDCP is not affiliated with NYSLRS, but New York State employees and some municipal employees can participate. If you’re a municipal employee, ask your employer whether you’re eligible for NYSDCP or another retirement savings plan.

National Retirement Security Month

Leave a reply

October is National Retirement Security Month. It’s a time to consider the importance of saving and to think about potential sources of income in retirement. Even if retirement seems far off, it’s never too early to start planning.

Retirement Security

NYSLRS and Retirement Security

Check out these blog posts to learn more about how your NYSLRS pension and other sources of retirement income can provide retirement security.

  • What is a Defined Benefit Plan?
    Your NYSLRS pension is a defined benefit retirement plan. When you retire, you’ll receive a guaranteed, lifetime benefit based on your earnings and years of service. A preset formula determines your benefit; it’s not limited to your accumulated contributions and investment returns, like with a 401(k)-style plan.  
  • The 3-Legged Stool Approach to Retirement Confidence
    Think of your retirement security as a three-legged stool. Each leg represents a different income source that supports you in retirement. The first leg of the stool is your NYSLRS pension, and the second is your Social Security benefit. The third leg is your own personal savings, which can help provide security in retirement and give you more freedom to do the things you want to do.
  • Compounding: A Great Way for Your Money to Grow
    The sooner you start saving, the better—especially if you invest in a retirement savings plan that reinvests the returns you earn. Such compounded savings increase in value by earning interest on both the principal and accumulated returns. But for your money to make more money in this way, it needs time to grow.
  • Deferred Compensation: Another Source of Retirement Income
    Deferred compensation plans are voluntary retirement savings plans like 401(k) or 403(b) plans designed and managed with public employees in mind. You can contribute as little as 1 percent of your earnings—automatically deducted from your paycheck. Deferring income from your take-home pay may mean less money to spend in the short-term, but it’s an easy way to start saving extra for retirement.
  • Give Your Retirement Savings a Boost
    Once you’ve started saving for retirement, you may want to look for ways to increase how much you save. Even small increases can make a big difference over time—and may have a minimal impact on your take-home pay.

Remember, retirement security doesn’t just happen—it takes planning.

Visit our Retirement Planning page for more information about your NYSLRS pension, including a calculator to estimate your monthly payments and a tool to help you find your retirement plan publication for a complete description of your benefits.

Your Death Benefit Beneficiaries

Leave a reply

NYSLRS retirement plans provide death benefits for beneficiaries of eligible members who die before retiring.

It’s important to name beneficiaries and review them periodically. Life circumstances change—for instance, you may have a new partner, or you may have children now. The beneficiary you may have named before might not be the one you would choose today. And NYSLRS can only pay a death benefit to the beneficiaries you’ve named.

If you are retired or planning to retire soon, read our blog post, Can You Change Your Beneficiary After You Retire?

2 Types of Beneficiaries

  • Your primary beneficiary will receive your death benefit. You can list more than one primary beneficiary. If you do, they will share the benefit equally. Or, you can choose different percentages for each beneficiary, which must total 100 percent. (Example: John Doe, 50 percent; Jane Doe, 25 percent; and Mary Doe, 25 percent.)
  • A contingent beneficiary will only receive a benefit if all your primary beneficiaries die before you do. If you list multiple contingent beneficiaries, they will share the benefit equally unless you choose different percentages.

Special Beneficiary Designations

Your beneficiary doesn’t have to be a person. You can name your estate, a trust or a charity as your beneficiary.

Special Designations for Your NYSLRS Death Benefit Beneficiaries
  • Estate. When you die, your estate is the money and property you owned. Your death benefit will be given to the executor of your estate to be distributed according to the terms of your will. You can name your estate as the primary or contingent beneficiary of your death benefit. If you name your estate as the primary beneficiary, do not name a contingent beneficiary.
  • Trust. You can name a trust as a primary or contingent beneficiary if you have a trust agreement or provided for a trust in your will. The trust itself would be your beneficiary, not the individuals for whom you established the trust. (Speak with your attorney if you’re thinking about making your trust a beneficiary.)
  • Entity. You can also name any charitable, civic, religious, educational or health-related organization as a beneficiary.
  • Minor children. If your beneficiary is under the age of 18 at the time of your death, your benefit will be paid to the child’s court-appointed guardian. You may instead choose a custodian to receive the benefit on the child’s behalf under the Uniform Transfers to Minors Act (UTMA). Custodians can be designated in Retirement Online, or you can contact us for more information and the appropriate form before making this type of designation.

For more information, read our publication, Life Changes: Why Should I Designate a Beneficiary?

Keep Your Beneficiaries Up to Date with Retirement Online

You can change your beneficiaries at any time. In addition to adding or removing them to reflect your current wishes, you should review the contact information for your named beneficiaries so we can find them when needed.

The fastest way to view or update your beneficiaries is in Retirement Online.

Can You Change Your Beneficiary After You Retire?

Leave a reply

That depends. If you choose a pension payment option that provides a lifetime benefit for a beneficiary, you cannot change your beneficiary even if they die before you do. However, if you choose a pension payment option that provides a benefit for a certain period after retirement, you can change your beneficiary after you retire. Learn more about the different pension payment options and whether they allow you to change your beneficiary below.

If your retirement plan provides a one-time lump sum death benefit after you retire, you can also change your beneficiary (or beneficiaries) for that benefit.

Can You Change Your Beneficiary After You Retire?

Available Pension Payment Options

At retirement, you will choose a pension payment option:

  • Single Life Allowance option: Provides the maximum monthly benefit payment to you for the rest of your life. This option does not provide a continuing benefit so you will not select a beneficiary, and all payments stop when you die.
  • Joint Allowance options: Provide a lifetime benefit to a loved one in exchange for a reduction to your monthly benefit payment. After your death, your beneficiary will continue to receive your pension (or part of it, depending on the option you choose) for the rest of their life. If your beneficiary dies before you, your monthly benefit payment remains the same and all payments stop when you die. However, if you choose one of the Popup-Up/Joint Allowance options and your beneficiary predeceases you, your monthly benefit payments will increase to the amount payable under the Single Life Allowance option. For these options, you can only choose one beneficiary, and you cannot change your beneficiary after you retire.
  • Five Year Certain or Ten Year Certain options: Provide a benefit for a certain period after retirement in exchange for a reduction to your monthly benefit payment. If you die within the five- or ten-year period after your retirement (depending on the option you choose), your beneficiary will continue to receive your monthly pension payment for the remainder of the five- or ten-year period. For these options, you can choose more than one beneficiary, and you can change your beneficiary after you retire.

Post-Retirement Death Benefit

Your pension is not your only NYSLRS retirement benefit. Most NYSLRS retirees are eligible to leave a death benefit if they retired directly from payroll or within one year of leaving employment. The post-retirement death benefit is a one-time lump sum payment. For information on how it’s calculated, visit our Death Benefits for Retirees page.

You can change your beneficiary for this benefit at any time, and your beneficiaries for this benefit do not have to be the same as your pension payment option beneficiary.

Manage Your Beneficiaries in Retirement Online

The fastest way to view or update your beneficiaries for your post-retirement death benefit is in Retirement Online.

You should also review the contact information for your beneficiaries so we can find them when needed.

How School Employees Earn NYSLRS Service Credit

4 Replies

school employees While most New York teachers and administrators are in the New York State Teachers’ Retirement System, other school employees are members of the New York State and Local Retirement System (NYSLRS). In fact, 1 out of 5 NYSLRS members works for a school district. Usually, their employment is tied to the school year, which is often 10 or 11 months long.

So how do we determine service credit for school employees?

Service Credit for School Employees

As a member, you receive service credit for paid public employment beginning with your date of membership. That credit is based on the number of days you work, which your employer reports to us.

If you’re working full-time, you receive one year of service per school year, even if you only work 10 months of the year.

For part-time work, your employer calculates days worked by dividing the number of hours worked by the hours in a full-time day. The number of hours in a full-time day is set by your employer (between six and eight hours). So, for example, if a 40-hour work week is considered full-time for your employer, and you work 20 hours a week for a given school year, you will receive half a year of service credit.

Calculating Service Credit

Usually, a full-time, 10-month school year is at least 180 days. However, depending on your employer, a full academic year can range from 170 days to 200 days. Whether you work full- or part-time, your service is based on the length of your school year:

For all BOCES and school district employees, as well as
teachers working at New York State schools for the deaf and blind:
Number of days worked ÷ 180 days

For college employees:
Number of days worked ÷ 170 days

For institutional teachers:
Number of days worked ÷ 200 days

Calculating Part-Time Service Credit for School Employees

Note: NYSLRS members can only earn one year of service credit per calendar year. For example, if you work full-time during the school year, you will not earn additional service credit if you also work during the summer.

Check Your Service Credit

You can sign in to Retirement Online to find your current estimated service credit. Look for Total Estimated Service under My Account Summary.

If you’re not sure whether you’re earning full-time or part-time service, you can check your most recent Member Annual Statement to see how much service you earned over the past fiscal year. In your Retirement Online account, click the View My Member Annual Statement button.

If you are receiving full-time service, it will say “1.00 Years” for “Service Credited from 4/1/2023 – 3/31/2024.” Remember, the total credited service you will see listed on your Statement was as of March 31, 2024. For more information about service credit, read our publication Service Credit for Tiers 2 through 6 (VO1854) or find your retirement plan publication.

Visit NYSLRS at the New York State Fair

Leave a reply

If you’re visiting the Great New York State Fair, stop by and see us.

The celebration of everything New York begins Wednesday, August 21, and runs through Monday, September 2 (Labor Day). Our information representatives will be at the fairgrounds in Syracuse daily, from 10:00 am to 9:00 pm.

You’ll be able to:

  • Ask questions about your NYSLRS benefits.
  • Pick up retirement plan booklets or brochures.
  • Get help registering for a Retirement Online account.

NYSLRS will be in the Center of Progress Building, Building 3 on the State Fair map, near the Main Gate. Look for us at booth 227.

Visit NYSLRS at the New York State Fair

Find Unclaimed Funds at the State Fair

OSC’s Office of Unclaimed Funds booth will also be in the Center of Progress Building. An unclaimed fund is lost or forgotten money. If an organization such as a bank, insurance company, corporation or state agency owes you money but hasn’t been able to contact you, they turn that money over to the Comptroller’s Office.

You can Search for Lost Money and see if any unclaimed funds are yours. So far this year, State Comptroller Thomas P. DiNapoli and the Office of Unclaimed Funds have returned more than $332 million.

Special Fair Days

Wednesday, August 21

  • Opening Day

Thursday, August 22

  • Student Youth Day—Youth and students under 18 years of age are admitted free on this day. ID showing date of birth may be requested.
  • Agriculture Career Day

Friday, August 23

  • Pride Day—The first state fair in America to host an official Pride Day to celebrate the LGBTQIA+ community.
  • New Americans Day
  • Family Fishing Day

Monday, August 26

  • Law Enforcement Day—Free admission to any active or retired law enforcement or corrections personnel who present a badge or picture ID from the department where they are or were employed.
  • Maple Day

Tuesday, August 27

  • Fire, Rescue and EMS Day—Free admission to any active or retired member of a fire department, emergency services or EMS organization who presents a picture ID from that department or organization.
  • Beef Day

Wednesday, August 28

  • Women’s Day

Thursday, August 29

  • Comptroller DiNapoli Visits the Fair—He is the trustee of the New York State Common Retirement Fund, the administrative head of NYSLRS and custodian of unclaimed funds. He will present area residents and organizations with unclaimed funds, and he’ll be stopping by the NYSLRS booth.
  • Armed Forces Day—Free admission to any active-duty service member or veteran with military identification (military ID card, form DD-214 or NYS driver license, learner permit or nondriver ID card with a veteran designation).
  • Dairy Day

Friday, August 30

  • Native American Day—Free admission to all members of Native American tribes, no ID required.

Monday, September 2

  • Labor Day

Your NYSLRS Pension—A Defined Benefit Plan

3 Replies

As a NYSLRS member, you are enrolled in a defined benefit plan, also known as a traditional pension plan.

If you are vested and retire from NYSLRS, you will receive a monthly pension payment for the rest of your life. Your pension will be calculated using a preset formula based on your earnings and years of service.

Your individual contributions to NYSLRS will not affect the pension you receive when you retire. Member contributions support the benefits earned by current and future retirees and are an important asset of the Common Retirement Fund.

Defined benefit plans are supported by contributions from both members and employers. With defined benefit plans, retirement assets are pooled and the investment risk is shared. These plans are usually administered by professional managers, whose long-term investment strategies help to reduce the impact of market turmoil. NYSLRS employs an experienced group of investment managers.

The New York State Common Retirement Fund, which holds and invests the assets of NYSLRS, is one of the largest public pension plans in the United States, providing retirement security for over 1.2 million NYSLRS members, retirees and beneficiaries. The Fund has consistently been ranked as one of the best managed and best funded plans in the nation.

understand your defined benefit plan

Defined Contribution Plans—And Their Risks

Defined benefit plans are often confused with 401(k)-style retirement savings plans, which are known as defined contribution plans.

With a defined contribution plan, the employee, the employer or both contribute to an individual retirement account for the employee, and the money in the account is invested. In most cases, the employee decides how and where the money is invested (or the plan may offer pre-packaged investment options). At retirement, the employee will be able to draw from the accumulated value of contributions and investment returns, minus any fees.

The amount of money the employee has at retirement often relies on the investment returns of the individual account. So, market downturns, especially near retirement, can negatively affect the value of the benefit. Employees depending on defined contribution plans run the risk of outliving their savings.

NYSLRS’ Defined Benefit Plans

We administer nearly 300 retirement plan combinations. NYSLRS retirement plans:

  • Provide a guaranteed benefit for life.
  • Offer a pension based on final average earnings and years of service.
  • Provide a right to pension benefits (vesting) with five years of service credit.
  • Build a cost-of-living adjustment (COLA) into pensions to help offset the effect of inflation.
  • Include disability retirement and death benefits.

We strongly encourage you to review your retirement plan publication for a complete description of your benefits. Visit our Find Your NYSLRS Retirement Plan Publication page and follow the steps listed.

Common Retirement Myths—Part 2

20 Replies

Sometimes a small misunderstanding can have a big impact on your retirement benefits. We debunked some common retirement myths in an earlier blog post. Here are five more myths you should be aware of.

Retirement Myths vs Facts

retirement myths

I updated my contact information with my employer, so I don’t need to update it with NYSLRS.

retirement fact

You need to update your contact information with both your employer and NYSLRS. Your employer does not provide updated member contact information to us. Make sure we have your current mailing address, phone number and email address on file so you receive the news, correspondence and statements we send you. Retirement Online is the fastest way to view and update your contact information with NYSLRS.

retirement myths

I can’t estimate my pension benefit until I’m close to retirement.

retirement fact

Even if you are years away from retiring, you can estimate your pension benefit in minutes using Retirement Online. Enter different retirement dates and beneficiaries to see how your choices affect your potential benefit and customize your estimate by adjusting your earnings if you anticipate a pay increase before you retire. (Note: Some members may not be able to use the Retirement Online pension calculator because of their circumstances—the system will notify you if your estimate cannot be completed, and you can send us a message using our secure contact form to request one.)

retirement myths

If I retire with an outstanding loan, my pension payment will be reduced temporarily until the loan is paid off.

retirement fact

If you retire with an outstanding loan, your pension will be permanently reduced.* We do not withhold loan deductions after retirement and apply it toward the outstanding balance until it’s paid in full.

Also, all or part of your outstanding loan balance may be subject to federal income taxes. If you retire before age 59½, the IRS may charge an additional 10 percent penalty.

*Employees’ Retirement System (ERS) members can repay their NYSLRS loan after they retire. However, you would need to pay the full balance of the loan in a one-time lump sum payment. Your pension would then be recalculated to remove the reduction and your monthly payment would increase going forward, but it would not be retroactive to your date of retirement.

retirement myths

The only way to file for retirement and begin receiving my pension is by completing a bunch of paper forms.

retirement fact

You can apply for retirement in Retirement Online, which is faster and more convenient than printing and mailing forms, and there’s nothing to have notarized. And when you apply online, you can also make changes online before your date of retirement—for example, if you need to change your banking or tax information. Watch our video for more information.

retirement myths

I can change my pension beneficiary after I retire.

retirement fact

Most retirees have 30 days from the start of the month following their retirement date to change their option election. After those 30 days, only certain pension payment options let you change your beneficiary.

  • The Single Life Allowance option provides the maximum monthly benefit payment to you for the rest of your life, but all payments stop upon your death, so nothing will be paid to a beneficiary.
  • The Joint Allowance or Pop Up Joint Allowance options provide a lifetime benefit for a beneficiary. After the initial 30-day window, you cannot change your beneficiary for any reason.
  • The Five Year Certain or Ten Year Certain options provide benefit payments to a beneficiary for a finite period if you die within five or ten years of your retirement—if you choose one of these options, you can change your beneficiary at any time. If you live beyond the five- or ten-year period, your beneficiary will not receive a pension benefit upon your death.    

Note, most retirement plans also provide a post-retirement death benefit, which is a one-time lump sum payment to your beneficiaries—you can change your beneficiaries for this at any time.

You can find more facts about your NYSLRS benefits in your retirement plan publication. If you have account-specific questions, please message our customer service representatives using our secure contact form.

Common Retirement Myths—Part 1

5 Replies

The laws governing your NYSLRS retirement benefit can be confusing. Sometimes a small misunderstanding can have a big impact on your finances. So base your financial decisions on retirement facts, not common myths.

Retirement Myths vs Facts

myth

My NYSLRS pension is like a 401(k)-style retirement savings account and I will get my contributions back when I retire.

fact

Your NYSLRS pension is a defined benefit plan. Your pension will be a lifetime benefit based on your earnings and years of service—it will not be based on your contributions. Member contributions support the benefits earned by current and future retirees and are an important asset of the Common Retirement Fund.

myth

If I work for more than one NYSLRS participating employer, the service credit from both will count toward my pension benefit.

fact

It depends. You can only earn one year of service credit in a 12-month period. If you work part-time for two participating employers, you would receive credit toward retirement from both, up to the maximum of one year. However, if you already work full-time for one NYSLRS employer, plus you work part-time for another employer, your part-time job won’t increase your retirement service credit. Also, if you are a full-time employee of a school district, you won’t earn extra service credit if you work during the summer.

myth

NYSLRS administers health insurance coverage for its retirees.

fact

NYSLRS does not administer health insurance programs. We may deduct premiums from a retiree’s monthly pension benefit to pay for health insurance coverage if their former employer instructs us to do so, but we can’t answer questions about coverage or changes in premium amounts.

The New York State Department of Civil Service administers the New York State Health Insurance Program (NYSHIP) for New York State retirees and some municipal retirees. If you are still working, your employer’s Human Resources (Personnel) office should be able to answer your questions about post-retirement coverage.

myth

I can take out a NYSLRS loan after I retire.

fact

You need to actively work for New York State or a participating employer to take a NYSLRS loan. They are not available to retirees.

myth

If I’m vested and no longer working for a public employer, NYSLRS will automatically start paying my pension as soon as I’m eligible.

fact

Your pension is not automatic. You must apply for retirement 15 to 90 days before your retirement date. Your retirement date is up to you. In order to retire, a NYSLRS member must terminate employment and be removed from the payroll of their employer(s) before the effective date of retirement.

Most NYSLRS members can begin collecting their pension as early as age 55. If you retire between age 55 and your full retirement age (62 or 63, depending on your tier and plan), you may face a permanent benefit reduction. If you have left public employment though, your benefit won’t increase after you reach full retirement age so don’t delay filing for retirement beyond that point.

You can find more answers about your NYSLRS benefits in your retirement plan publication. If you have account-specific questions, please message our customer service representatives using our secure contact form.

Check out Common Retirement Myths—Part 2 where we debunk five other retirement myths.

Divorce and Your Other NYSLRS Benefits — Part 2

Leave a reply

divorce and your other nyslrs benefitsWe’ve written about how divorce may affect your pension. However, as a NYSLRS member, you have other benefits divorce may affect.

If your ex-spouse will receive a share of your retirement benefits, domestic relations order (DRO) must be filed with NYSLRS. A DRO is a court order specifying how your pension should be divided as well as the distribution of other benefits discussed below.

Death Benefits and Your Beneficiaries

As of July 7, 2008, beneficiary designations for certain death benefits are automatically revoked when a divorce, annulment or judicial separation becomes final. If you are divorced, it is especially important to review your beneficiary designations to ensure your benefits will be distributed according to your wishes and your divorce agreement.  

If your ex-spouse is awarded a portion of your death benefits, a DRO will specify how much your ex-spouse will receive and direct you to name your ex-spouse as a beneficiary. You should file the DRO with NYSLRS as soon as it’s officially accepted by the court and choose additional beneficiaries for the remainder of any benefits. However, if your designations conflict with the terms of the DRO, the DRO will take precedence over any other beneficiary designations.

The best way to view and update your death benefit beneficiaries is by using Retirement Online. If you are already retired, visit our Death Benefit page for retirees for information about available death benefits and how to update your beneficiaries and their contact information.

Ordinary Death Benefit

Your ordinary death benefit would be payable to your beneficiaries if you die in active service (before retiring).

Post-Retirement Death Benefit

Most members of the Employees’ Retirement System (ERS) are covered by a post-retirement death benefit, which provides a one-time, lump sum payment to your beneficiaries if you die after retiring.

Accidental Death Benefit

Your accidental death benefit may be payable to certain beneficiaries if you die as a result of an on-the-job accident. The beneficiaries of this benefit are designated by law, and only those beneficiaries may receive this benefit — even if there is a DRO.

Loans

NYSLRS members who meet eligibility requirements can take out a NYLSRS loan by borrowing a percentage of their contribution balance. Even if you are eligible, a DRO may be written to prohibit you from taking future loans.

If you retire with an outstanding loan balance, your pension will be reduced. The ex-spouse’s share of the pension will also be reduced unless the DRO specifically states the ex-spouse’s share should be calculated without reference to outstanding loans.

Contribution Refunds

Occasionally, NYSLRS may refund a member’s contributions because of a tier reinstatement, membership withdrawal or membership transfer. Some members are eligible to make voluntary contributions and withdraw them as excess contributions. Generally, if a DRO doesn’t mention a contribution refund, the member will receive the full amount.

For More Divorce Information

Visit our Divorce and Your Benefits page for more information, including how divorce can affect service credit, disability benefits or cost-of-living adjustments.