Here are some of our most popular blog posts from the past year. Not surprisingly, during 2020 members and retirees were interested in information about doing business with NYSLRS online. Fortunately, new Retirement Online features made that a lot easier during a challenging time.
What to Know About ERS Tier 6 Employees’ Retirement System (ERS) Tier 6 includes members who have joined NYSLRS since April 1, 2012. It now accounts for 45 percent of all ERS membership. This is a basic overview of retirement benefits for ERS Tier 6 members.
Do We Have Your Correct Contact Information? Keeping your mailing address and other contact information up to date ensures that you receive important information from NYSLRS about your benefits. Once again, Retirement Online makes the task easy to accomplish.
Doing Business With NYSLRS Retirement Online is a secure, easy way to check your benefit information and conduct transactions in real time. Here’s a rundown of the many features it offers.
Estimate Your Pension in Retirement Online How much will your pension be? Most NYSLRS members can use the pension calculator in Retirement Online to get a benefit estimate based on information we have on file for them. You can enter different retirement dates to compare potential benefits.
As a NYSLRS member, you have a defined benefit retirement plan that provides a lifetime pension when you retire. The formula used to calculate these benefits is based on two main factors: service credit and final average earnings. You’re probably familiar with service credit — it’s generally the years you’ve spent working for a participating employer. But what are final average earnings (FAE)?
When we calculate your pension, we find the set of consecutive years (one, three or five, depending on your tier and retirement plan) when your earnings were highest. The average of these earnings is your FAE. Usually your FAE is based on the years right before retirement, but they can come anytime in your career. The years used in determining your FAE do not necessarily correspond to a calendar year. For FAE purposes, a “year” is any period when you earned one full-time year of service credit.
Types of Final Average Earnings
Your tier and plan determine how your final average earnings is calculated:
Three-year FAE: Members in Tier 1, 2, 3, 4 and 5.
Five-year FAE: Members in Tier 6.
One-year FAE: Members in the Police and Fire Retirement System (PFRS). Your employer must choose to offer this benefit. It’s not available to PFRS members covered by Article 14 and generally not available to PFRS Tier 6 members.
If you are not sure what retirement plan you are in, you may want to read our recent blog post.
Exclusions and Limits
The law limits the final average earnings of all members who joined on or after June 17, 1971. For example, for most members, if your earnings increase significantly through the years used in your FAE, some of those earnings may not be used toward your pension. The specific limits vary by tier; check your retirement plan booklet on our Publications page for details.
Since 2010, with the creation of Tiers 5 and 6, the Legislature and the Governor have introduced additional limits to the earnings that can be used toward the FAE:
Overtime pay is capped — For Employees’ Retirement System (ERS), $20,763.51 in 2021. For PFRS, the cap is 15 percent of earnings.
Your final average earnings is based on money earned during the period used to calculate your pension. This may include payments you receive after you retire, such as retroactive pay from a contract negotiation or pay for unused vacation days.
Calculating your FAE at retirement can take time because we must collect salary information from your employer(s) and factor in items such as retroactive payments and earnings you receive after your date of retirement. This is necessary to ensure that your pension calculation is accurate and that you receive all the benefits you are entitled to.
Retirement Online will be unavailable for a few days while we complete routine year-end maintenance. Retirement Online will be offline from 3:00 pm on Tuesday, December 29 until 7:00 am on Friday, January 1.
Using the NYSLRS Automated Phone System During the Maintenance Period
Another way you can get information about your NYSLRS benefits is through our automated phone system, which allows you to get personal account information, order forms and conduct other retirement transactions without having to speak with a customer service representative. The automated phone system is generally available 24 hours a day, seven days a week, so you can conduct business with NYSLRS on your schedule.
Retirees can use the automated phone system to:
Request that NYSLRS forms be mailed to them,
Report a lost, stolen or late pension check,
Get tax information,
Get information about cost-of-living adjustments (COLAs), and
Request a direct deposit form.
Members can use the automated phone system to:
Request that NYSLRS forms be mailed to them,
Find out if they are eligible for a loan or get their current loan balance,
Request that a benefit projection be mailed to them, and
Get personalized information about purchasing credit for previous service.
Here are the retiree menu options for the phone system:
Here are the member menu options for the phone system:
Other Ways to Get Information
If you are looking for general information about NYSLRS benefits, you can:
Email our customer service representatives using our secure email form for questions on account-specific information. Filling out the secure form allows them to safely contact you about your personal account information.
Information is the key to being fully prepared for your retirement years. The single most important thing you can do to achieve this goal is to know what NYSLRS retirement plan you’re in. Once you know that, the next thing you must do is understand the benefits your plan provides.
Your retirement plan booklet covers things like how long you’ll need to work in order to receive a pension, how your pension amount is determined, and what kind of death and disability benefits may be available to you. You can find a copy of your plan booklet on our website’s Publications page.
But here’s the challenge: NYSLRS manages 335 retirement plan combinations, which are described in 51 plan booklets. How do you figure out which is yours? The information below should help.
Two Key Questions
To get started, you need to answer two questions.
Question One: Which retirement system are you in? NYSLRS is made up of two different systems:
The Employees’ Retirement System (ERS), which is for public employees in non-teaching positions. It also includes some law enforcement personnel, such as correction officers, sheriffs and sheriffs’ deputies.
The Police and Fire Retirement System (PFRS), which is for paid firefighters and police officers, including SUNY police, State Park police, Encon officers and State Forest Rangers.
Question Two: Which tier are you in? There are six tiers in ERS and five tiers in PFRS. Your tier, based on when you joined NYSLRS, determines such things as when you become eligible for benefits and how much you contribute. You can find your tier by checking your Account Information in Retirement Online or by checking the NYSLRS website.
For many members, knowing your retirement system and tier are enough. But for other members, especially those in law enforcement, it may help to have your retirement plan number as well. The plan number indicates the section of Retirement and Social Security Law the plan is based on. For example, Plan A15 indicates that you are covered by Article 15. You can find your plan number in the Account Information section of Retirement Online.
Roughly three-quarters of all ERS members are covered by Article 15; they just need to know their tier to find the correct booklet.
If you are still unsure which retirement plan booklet covers your benefits, you can send us an email using our secure contact form, or you can ask your employer.
Take the Time to Understand Your Retirement Plan
It cannot be stated enough how important it is to read your plan publication to learn all you can about your benefits. It is the key to solid retirement planning. Remember, no one has a more vested stake in your retirement than you do.
After you file for retirement, we will send you and your employer an acknowledgement letter, which will list your retirement date. We may reach out to you for additional information to complete the retirement process — what option you selected, what federal tax to withhold, and your banking information for electronic payments.
Fortunately, if you used Retirement Online, you were able to select your payment option, provide tax withholding information, and enroll in our Direct Deposit Program when you completed the online application.
If you mailed a paper application and did not include this information, we’ll send you the necessary forms to fill out and send back to us. The forms are also available on our website if you want to print your own:
W-4P form: If you don’t submit a W-4P, we’ll withhold federal taxes based on the status “married with three dependents.” You can change your withholding at any time.
Option Election form: If you haven’t received a pension estimate from our office in the past 18 months, you don’t need to include your pension payment option election when you file a paper application — you can wait until after you review an estimate to choose an option. We’ll send you an estimate, along with an option election form, after we receive your retirement application.
Receive Your First Payment
Once NYSLRS receives your retirement application, we will determine your initial pension benefit amount based on the earnings and service information we have on file at the time of your retirement.
Most NYSLRS retirees get their first pension payment at the end of the month following the month they retire. Please note: we cannot send your first payment until we have proof of your date of birth. A copy of your New York driver’s license, birth certificate, passport or naturalization papers are acceptable proofs. If you didn’t have proof of date of birth available when you submitted your retirement application, you can email us a copy by attaching it to our secure contact form or upload it using Retirement Online.
Possible Adjustments to Your Pension
If we receive additional payroll information from your employer, such as eligible lump sum payments, a retroactive pay increase or lagged regular earnings, we may need to adjust your pension payment.
Because of the many variables that are often involved in verifying service and salary details with your former employer, finalizing your retirement benefit amount can take some time. The time this takes depends on the complexity of your circumstances. For example, if you worked for multiple public employers, it may take longer to pull together all your earnings information. Also, if you are transferring service from another retirement system, filing a Domestic Relations Order or are seeking to purchase past service credit, you should expect a delay in receiving a finalized pension amount.
Once we have all the information we need, we’ll recalculate your pension amount. In most cases, your initial payments will be very close to the final benefit amount, but if your payment increases, you will receive a retroactive payment for the amount you are owed back to your date of retirement (the difference between your initial payments and your final retirement benefit amount).
You can now file for a service retirement benefit using Retirement Online. This new feature makes applying for retirement faster and easier than ever before. If you don’t already have an account, sign up today.
And, if you become ill with COVID-19, you may want to file for retirement to protect your loved ones.
File for a Service Retirement Online
After signing in to your Retirement Online account, scroll down to the ‘My Account Summary.’ On the right, under the heading ‘I want to…,’ click the green “Apply for Retirement” button.
From there, you’ll go through a series of screens where you’ll be able to:
Get an estimate of your pension and the payment options available to you;
Select a payment option (many provide a continuing benefit for a beneficiary after you die);
Sign up for direct deposit; and
Attach required documents, such as proof of date of birth.
A big advantage of filing for Retirement Online is that you do not have to get anything notarized.
After you click the “Submit” button, it is important that you do not close your browser until you receive a confirmation message that states your retirement application has been successfully submitted.
If you decide to file your application by mail, you will have to have your signature notarized on the application and on the payment option election form.
You can have forms notarized using audio-video technology, which allows a notary to witness a signature remotely. You can find more information about the virtual notary process on the New York Secretary of State website.
If you are in quarantine and perhaps unable to use a virtual notary, you can submit a signed form that is not notarized. You’ll need to include a letter to NYSLRS to explain that you were under quarantine when the form was signed, and submit notarized forms once the quarantine is lifted.
If you use regular mail, the filing date is the date we receive it. However, if you were to die after your application is mailed, but before we receive it, a legible postmark will serve as a filing date. (If you mail it from a post office, you can ask for a hand cancellation, which may help ensure the postmark is legible.)
If you become seriously ill, you may wish to file for a disability retirement benefit. That way, if you were to die before your retirement date, your beneficiary may still be eligible for a continuing pension, rather than a one-time, in-service death benefit. You may apply for a disability retirement at the same time you apply for a service retirement — there is no 15-day waiting period when filing for disability retirement.
For More Details, Read Your Retirement Plan Booklet
Your service and disability retirement benefits and death benefits are based on your tier, plan, service credit, and other factors. For details about your available benefits, please read your retirement plan booklet, available on our Publications page, or you can call our Contact Center at 866-805-0990 if you have questions.
Most members can get a NYSLRS loan using Retirement Online. Loan eligibility requirements are based on your tier, but generally, you’ll need to be on the payroll of a participating employer, have at least one year of service and have a certain amount of contributions in your account. Retirement Online will provide the eligibility information you need as you step through the application process.
Retirement Online is the fastest way to get a NYSLRS loan. It’s also an easy way to find out your current loan balance, the amount you are eligible to borrow and more. If you don’t already have an account, go to the Sign In page and click “Sign Up” under the Customer Sign In button. (Need help with Retirement Online? See this post for handy tips.)
The Application Process
Once you’ve signed in, scroll down to ‘My Account Summary.’ Under ‘I want to…’ click the green “Apply for a Loan” button and follow the prompts.
As you work your way through the online application, you’ll see how much you can borrow, the minimum repayment amount, the expected payoff date and how much you can borrow without tax implications.
NYSLRS loans are exempt from New York State and local income taxes. However, the Internal Revenue Service may consider all or part of a NYSLRS loan taxable in some cases – for instance, if you borrow above certain limits. The Retirement Online loan application will show you the maximum amount you can borrow without tax implications.
If you already have a loan and you want to take another loan, you can take multiple loans or refinance an existing loan. Taking a new loan (the multiple loan option) minimizes your potential tax consequences. Your minimum payment will be higher, but you will pay off your loans faster than you would by refinancing. Refinancing adds the new loan amount to your existing balance and spreads the entire balance over a new five-year term. Your payment will be lower but your tax consequences may be significantly higher.
Repaying Your NYSLRS Loan
Loan payments will be deducted from your paycheck. You can choose the minimum payroll deduction, which would pay off your loan in five years, or you can choose to pay more than the minimum to pay off your loan sooner. The payment calculator in Retirement Online will provide your expected payoff date if you enter an amount higher than the minimum.
If you already have loan from NYSLRS, during this time of economic uncertainty you may be considering whether you can defer your NYSLRS loan payment.
If you are furloughed or on an authorized leave of absence with your employer, the IRS allows for the suspension of loan payments for up to one year from the date your leave began or until you return to the payroll (whichever occurs first). To receive this deferment, have your employer send us a fax (518-486-9877) on their letterhead that indicates the date your leave began and when they expect it will end.
It’s important to note that if you defer your loan payments during an authorized leave of absence, your payments will need to be recalculated and increased upon your return. This will ensure your loan will be paid off within the five-year period.
For more information, including how retiring with an outstanding loan would affect your pension, visit our Loans page. If you need help with the self-service loan application, click “Help” at the top of your account page. Then click next to ‘Requesting a Loan’ and select the step-by-step guide that best fits your situation. Retirement Online is generally available from 7:00 am to 9:30 pm on Monday, Wednesday, Thursday and Friday; from 7:00 am to 6:00 pm on Tuesday; and from 6:00 am to 11:00 pm on Saturday and Sunday.
Most NYSLRS members contribute a percentage of their earnings to the Retirement System. Over time, those contributions, with interest, can add up to a tidy sum. But what happens to that money? Will you get your contributions back when you retire? The answer to that question is “no.” Let’s look at what happens to your NYSLRS contributions.
How NYSLRS Retirement Plans Work
NYSLRS plans are defined benefit pension plans. Once you’re vested, you’re entitled to a lifetime benefit that will be based on your years of service and final average earnings. The amount of your contributions does not determine the amount of your pension. (Use Retirement Online to estimate your pension.)
Your NYSLRS plan differs from defined contribution plans, such as a 401-k plan, which are essentially retirement savings plans. In those plans, a worker, their employer, or both contribute to an individual retirement account. The money is invested and hopefully accumulates investment returns over time. This type of plan does not provide a guaranteed lifetime benefit and there is the risk that the money will run out during the worker’s retirement years. Experts recommend that workers who have defined contribution plans contribute anywhere from 10 to 20 percent of their income to their plan. NYSLRS members, in contrast, contribute between 3 and 6 percent of their income, depending on their tier and retirement plan.
Where Your Contributions Go
When you retire, your contributions go into the New York State Common Retirement Fund. The Fund is the pool of money that is invested and used to pay retirement benefits for you and other NYSLRS members.
Your Contribution Balance
You can find your current contribution balance in Retirement Online. But if your contributions don’t determine your pension, what difference does it make what the balance is? For one thing, your contribution balance helps determine the amount you can borrow if you decide to take a loan from NYSLRS. Also, you may be able to withdraw your contributions, with interest, if you leave the public workforce before retirement age.
Withdrawing Your Contributions
You cannot withdraw your contributions while you are still working for a public employer in New York State. If you leave public employment with less than ten years of service, you can withdraw your contributions, plus interest. If you withdraw, you will not be eligible for a NYSLRS retirement benefit.
If you have more than ten years of service, you cannot withdraw, but you will be entitled to a pension when you reach retirement age. But remember, you will not receive this pension automatically; you must file a retirement application before you can receive any benefit.
Is it possible you left money in an old bank account? Maybe you lost track of a security deposit, insurance payout, stock dividend or mutual fund? Could there be a distant relative who left bonds in your name? State law requires banks, insurance companies, corporations and the courts to notify the owner of any dormant accounts. Despite these efforts, some funds remain unclaimed and are turned over to the Office of the State Comptroller (OSC). State Comptroller Thomas P. DiNapoli serves as the custodian of unclaimed funds until they’re claimed by the rightful owners.
Every day, our Office of Unclaimed Funds (OUF) returns more than $1.5 million to their rightful owners. In the largest payout to date, one New York State resident received $5.2 million from a stock claim. During State fiscal year 2019-2020, $415 million was paid out.
Yet New York State still holds 42 million unclaimed accounts, including $8 million for an estate. Most unclaimed account amounts are much more modest, with 70 percent of claims being less than $100.
How to Search for Unclaimed Funds
OUF has made it easy to search for money that may belong to you. It takes just a few minutes to search the online Unclaimed Funds database, and it’s free. And if you find some lost money, it would make a great addition to your retirement savings.
Visit OSC’s Unclaimed Funds website, click the “Search Now” button, enter your name and click “search.” If you find your name in the database, you can file your claim online. To protect you from fraud, OUF can’t tell you the amount of your claim until they receive and confirm your proof of ownership.
OUF has been working to improve online services for those seeking to claim funds. Here are some recent improvements:
Claimants can submit requested documents, such as a signed form or legal documents, online.
Claims for deceased owners can be submitted online, cutting processing time in half.
Automatic text messages can be sent to alert customers about the status of their claim.
There is no charge for searching for unclaimed funds or filing a claim. Location service providers have no special access to our database and will not get you your money any faster. These companies may charge a finder’s fee of up to 15 percent for locating unclaimed funds.
NYSLRS, which comprises the Employees’ Retirement System (ERS) and the Police and Fire Retirement System (PFRS), had 673,336 members as of March 31, 2020. Our members are State government, local government and school district employees from across New York, including 637,746 in ERS and 35,590 in PFRS. Seventy-nine percent of our members were active, which means they were on a public payroll as of March 31.
NYSLRS Membership Over Time
A decade ago, nearly 90 percent of NYSLRS members were in Tiers 3 and 4. Now, those tiers represent less than half of our membership, while Tier 6 members are on the verge of surpassing them. Tier 6, which includes members who joined NYSLRS since April 1, 2012, has 298,633 members, or 44.4 percent of total membership.
Here’s a look at our NYSLRS membership by tier, as of March 31:
Tier 1: NYSLRS’ oldest tier, whose members first joined the system before July 1, 1973 (July 31, 1973 for PFRS members), is dwindling. Tier 1 represented only 0.2 percent of our membership. There were only 1,552 Tier 1 ERS members and 24 Tier 1 PFRS members.
Tier 2: With 22,262 members, Tier 2 represented 3.3 percent of membership. Ninety-two percent of Tier 2 members were in PFRS.
Tiers 3 & 4: Tiers 3 and 4, which have similar retirement plans, had 311,213 members, 46.2 percent of the total membership. Tiers 3 and 4 are primarily ERS tiers. There is no Tier 4 in PFRS, and only 228 PFRS members were in Tier 3.
Tier 5: Tier 5 covers members who joined from January 1, 2010 through March 31, 2012. With 39,652 members, Tier 5 represented 5.9 percent of membership.
Tier 6: This tier covers members who joined since April 1, 2012. Its ranks grew by 15 percent during the last fiscal year.