Tag Archives: benefits

Planning for an Unplanned Retirement

Know Your Benefits

As a NYSLRS member, you’re entitled to benefits that may help. Most vested members can begin collecting a lifetime pension as early as age 55, though your benefit may be permanently reduced if you retire before full retirement age. (Full retirement age for NYSLRS members is either 62 or 63, depending on your tier. Full retirement age for Social Security benefits depends on your year of birth.)

If you can no longer do your job because of a physical and mental condition, you may be eligible for a Social Security Disability, or a NYSLRS disability benefit if your disability is permanent.

You may also want to look into Workers’ Compensation if you are injured on the job or Unemployment Insurance if you have been laid off from a position.

Other Ways to Plan for the Unexpected

Doing your homework is important. The more you understand the potential benefits available to you, the better you can estimate your income if you are forced to retire early. Unfortunately, the numbers you come up with may not be enough when dealing with an unplanned retirement.

But one potential source of income can make a big difference: retirement savings. Your savings could help you get by until you are eligible to collect your NYSLRS pension or another retirement benefit. If you are not saving for retirement, consider starting now. And if you are saving, consider increasing your savings. It could become a lifeline if the unexpected happens.

New York State employees and some municipal employees can also save for retirement through the New York State Deferred Compensation Plan. Ask your employer if you are eligible.

For more information about the benefits offered by your NYSLRS retirement plan, visit our website to read your plan publication.

Firefighters Deserve A Salute Every Day

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Recognizing Firefighters

It’s National Fire Prevention Week this week and, while attention is properly focused on promoting fire prevention, we also think it’s a great time to recognize all the firefighters who are members of the New York State and Local Retirement System (NYSLRS).

Of the 533,415 members in NYSLRS, 32,470 are in the Police and Fire Retirement System (PFRS). More than 6,000 of these brave men and women are firefighters.

NYSLRS Membership and Firefighters

All firefighters working for participating employers are PFRS members. With that membership comes a variety of benefits, including certain death and disability benefits as well as a pension. As firefighters and other PFRS members progress through their careers they become eligible for these benefits. For example, from day one, PFRS members are covered by job-related death and disability benefits. However, with ten years of service credit, most members are also eligible for a non-job-related disability benefit.

In addition, most PFRS employers offer their employees special retirement plans. A special plan lets members retire after completing 20 or 25 years of credited service in specific job titles rather than reaching a certain age. Most firefighters — and, in fact, nearly 80 percent of all PFRS members (25,784) — are enrolled in a set of special 20- and 25-year plans. Whether members need 20 or 25 years depends on their retirement plan.

Firefighters are Heroes

To the members of the New York State Professional Fire Fighters Association, the Firemen’s Association of the State of New York and the New York State Association of Fire Chiefs; to the county fire marshals, supervising fire marshals, fire marshals, assistant fire marshals, assistant chief fire marshals and chief fire marshals: Thank you for your service to New York and its citizens. We are grateful for the valuable service you provide all of us.

Spending Changes in Retirement

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Just like starting your first job, getting married or having kids, retirement will change your life. Some changes are small, like sleeping in or shopping during regular business hours. Others, however, are significant and worth examining ahead of time… like how much you’ll be spending in retirement each month or each year.

An Employee Benefit Research Institute (EBRI) study offers some good news for prospective retirees. Household spending generally drops at the beginning of retirement — by 5.5 percent in the first two years, and by 12.5 percent in the third and fourth years. (Although, nearly 46 percent of households actually spend more in the first two years of retirement.)

Analysis from the Bureau of Labor Statistics in the U.S. Department of Labor seems to support the research from EBRI. In “A closer look at spending patterns of older Americans,” the author analyzed data from the 2014 Consumer Expenditure Survey, and she also found a progressive drop in spending as age increases. (Income declines with age as well.)

While data supporting EBRI’s study is helpful, it turns out that the highlight of the Consumer Expenditure Survey results is a detailed look at how the things we spend our money on change as we grow older.

As interesting as that is, it’s just a general look at how older Americans are managing their money. What really matters is: How will you spend your money once you retire?

Prepare a Post-Retirement Budget

Like a fiduciary choir, financial advisors all sing the same refrain: Start young; save and invest regularly to meet your financial goals. If you do, the switch from saving to spending in retirement can be easy.

But, in order to make that transition, you need a budget.

The first step toward a post-retirement budget is a review of what you spend now. For a few months, track how you spend your money. Don’t forget to include periodic costs, like car insurance payments or property taxes. By looking at your current spending patterns, you can get an idea of how you’ll spend money come retirement.

Then, consider your current monthly income, and estimate your post-retirement income. If your post-retirement income is less than your current income, you might want to plan to adjust your expenses or even consider changing your retirement date.

We have monthly expense and income worksheets to help with this exercise. You can print them out and start planning ahead for post-retirement spending.

Monthly Worksheets (PDF)

For those of you who carry smart phones, Forbes put together a list of popular apps for tracking your daily spending. All of them are free, though some do sell extra features. Many of them can automatically pull in information from your bank and credit card accounts, but if you’d rather avoid that exposure or if you use cash regularly, you may prefer an app that lets users enter transactions manually.

Creditable Service for Police & Fire Members

What Credit Counts Towards Retirement?

The public service that can be used toward your 20 or 25 years is determined by the specific retirement plan under which you’re covered. Check your retirement plan booklet for details.

There are booklets for state police , forest rangers , regional state park police , state university police , EnCon police and members covered under Sections 384, 384-d and 384-e of Retirement and Social Security Law (RSSL). More plan booklets are available on our Publications page.

The most common PFRS plan, which covers nearly 50 percent of PFRS members, was established by Section 384-e of RSSL. With this plan, you earn creditable service:

As a firefighter or police officer under the 384-e plan;
As a member or officer of the New York State Police; or
In the military, as specified by law.

In the 384-e retirement plan, civilian service, as well as service as a sheriff, corrections officer or volunteer firefighter, is not creditable.

creditable service for police and fire retirement system members

Transferring Membership or Purchasing Service Credit — Contact Us First

If you have worked for multiple New York State public employers and are unsure if all of your service is creditable towards your 20 or 25 year plan, contact us before transferring membership or purchasing service credit . Please note: the public service that can be used toward your 20 or 25 years is determined by legislation and differs among plans offered to PFRS members. You should also be sure to request an estimate from us well before your planned date of retirement if there is any question about your creditable service.

Get an Estimate

PFRS members should request an estimate from us as early as 18 months before you plan to retire. It’s the best way to make sure you have all the credit you’re entitled to. Simply fill out and return a Request for Estimate (RS6030) form.

Getting Credit for Your Military Service

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If you served in the U.S. Armed Forces, you may be eligible to buy back up to three years of active service credit. Because service credit is a factor in calculating a NYSLRS pension, in most cases buying military service credit will increase your pension.

Military Service Credit

To be eligible, veterans must:

Have been honorably discharged;
Have at least five years of credited service in the Retirement System;
Have not received credit for this service in any other public retirement system in New York State; and
Apply for and purchase military service credit before they retire.

How to Apply for Military Service Credit

To apply and request a cost for military service credit:

1. Fax your name, contact information and a copy of your DD-214 to 518-486-6405 or 518-402-7799;

2. Mail a letter with your name and contact information, and a photocopy of your DD-214, to:
Military Service Unit
110 State Street
Albany, NY 12244-0001

If after reviewing your application we determine you are eligible, we will send you a letter that will tell you how much credit you are eligible to purchase and the cost. Most members in Tier 1, 2, 3 or 4 can use our online benefit projection calculator to see how the credit would impact your pension. Tier 5 and 6 members can get that information by calling 1-866-805-0990, or using our secure email form (www.emailNYSLRS.com).

For more information, visit the Military Service Credit page on our website.

ERS Tiers 1 and 2: The New Career Plan

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Did you become a member of the Employees’ Retirement System (ERS) before July 1, 1973? If you’re still working in public service, you’re one of the 3,508 active members in Tier 1. If you joined after July 1, 1973 but before July 27, 1976, then you’re one of 4,127 active members in Tier 2.

Most ERS Tier 1 and Tier 2 members are in the New Career Plan (Section 75-h or 75-i). Currently, 96 percent of active Tier 1 members and almost 95 percent of active Tier 2 members are covered by this plan. Here’s a quick look at the benefits in the New Career Plan:

Benefit Eligibility

Tier 1

Members must be at least age 55 to be eligible to collect a retirement benefit.
There are no minimum service requirements — they may collect full benefits at age 55.

New Career Plan — ERS Tier 1

Tier 2

Members must have five years of service and be at least age 55 to be eligible to collect a retirement benefit.
The full benefit age is 62.
Almost 95 percent of active Tier 2 members are covered by the New Career Plan (Section 75-h or 75-i).

New Career Plan — ERS Tier 2

Final Average Salary

Final average salary (FAS) is the average of the wages earned in the three highest consecutive years of employment. For Tier 1 members who joined NYSLRS June 17, 1971 or later, each year used in the FAS calculation is limited to no more than 20 percent above the previous year’s earnings. For Tier 2 members, each year of earnings is limited to no more than 20 percent above the average of the previous two years’ earnings.

Benefit Calculations

For Tier 1 and 2 members, the benefit is 1.66 percent of the FAS for each year of service if the member retires with less than 20 years. If the member retires with 20 or more years of service, the benefit is 2 percent of the FAS for each year of service.
Tier 1 members and Tier 2 members with 30 or more years of service can retire as early as age 55 with no reduction in benefits.
Both Tier 1 and Tier 2 members who worked continuously from April 1, 1999 through October 1, 2000 receive an extra month of service credit for each year of credited service they have at retirement, up to a maximum of 24 additional months.

If you have questions about the New Career Plan, please read the Tier 1 plan publication or the Tier 2 plan publication. You can find other plan publications on our website.

NYSLRS – One Tier at a Time: ERS Tier 1

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When you joined the New York State and Local Retirement System (NYSLRS), you were assigned to a tier based on the date of your membership. There are six tiers in the Employees’ Retirement System (ERS) and five in the Police and Fire Retirement System (PFRS) — so there are many different ways to determine benefits for our members. Our series, NYSLRS – One Tier at a Time, walks through each tier and gives you a quick look at the benefits members are eligible for before and at retirement.

One of our smallest tiers is ERS Tier 1, which represents 0.7 percent of NYSLRS’ total membership. Overall, there are 4,520 ERS Tier 1 members. Today’s post looks at the major Tier 1 retirement plan in ERS – the New Career Plan (Section 75-h or 75-i).
ERS-Tier-1-Benefits_001
If you’re an ERS Tier 1 member in an alternate plan, you can find your retirement plan publication below for more detailed information about your benefits:

New Career Plan for ERS Tier 1 Members (VO1504)
Career Plan for ERS Tier 1 Members (VO1503)
State Correction Officers and Security Hospital Treatment Assistants Plan for ERS Tier 1 Members (VO1525)
Sheriffs, Undersheriffs and Deputy Sheriffs Special Plan for ERS Tier 1 Members (VO1840)
Legislative and Executive Retirement Plan for Tier 1 Members (VO1861)
Non-Contributory Plan With Guaranteed Benefits for ERS Tier 1 Members (ZO1502)
Non-Contributory Plan for ERS Tier 1 Members (ZO1501)
Basic Plan for ERS Tier 1 Members (ZO1500)

Be on the lookout for more NYSLRS – One Tier at a Time posts. Want to learn more about the different NYSLRS retirement tiers? Check out some earlier posts in the series:

New York Retirement News

News from the New York State and Local Retirement System