THE EMERITI PROGRAM during your working years

Transcription

1 2014 Benefits THE EMERITI PROGRAM during your working years Saving for Health Care Expenses in Retirement This presentation is copyrighted exclusively by Emeriti 1

2 Your Institution s Commitment Your Institution is: Giving you a tax-free way to pay your health care expenses in retirement Providing access to group health insurance when you retire Keeping you informed about retiree health care issues along the way 2

3 Emeriti s Core Benefit Features Emeriti Health Accounts Tax-advantaged savings and investment vehicle for payment of future medical expenses in retirement Emeriti Health Insurance Portable group retiree health insurance options building on the foundation of Medicare Emeriti Reimbursement Benefits Tax-free reimbursement of qualified medical expenses not covered by Medicare or Emeriti insurance options Participant Education & Decision Support Services Online In print On the phone In person 3

4 4 Emeriti s Service Providers Emeriti TIAA- CREF Savitz Aetna HealthPartners Accumulation Recordkeeping Trust Services Investment Management Disbursement Recordkeeping Retiree Health Plans Retiree Health Plans Proprietary Mutual Funds Non Proprietary Mutual Funds Insurance Premiums Qualifying Medical Expenses Debit Card Manual Claims

5 Tax Advantages of Saving in Emeriti Health Accounts CONTRIBUTIONS DURING WORKING YEARS INVESTMENTS DISBURSEMENTS DURING RETIREMENT You Make After-tax Voluntary Contributions Your Institution Makes Tax-free Employer Contributions* Your Assets Accumulate Tax-Free You Receive Tax-Free Emeriti Reimbursement Benefits You Pay Tax-Free for Emeriti Health Insurance Premiums *Begins at a pre-designated age. See your Summary Plan Description or talk to your benefits administrator. Your institution may make additional pre-tax contributions in lieu of salary or other benefits. 5 8

6 Investment Options in 2014 CORE FUNDS TIAA-CREF Lifecycle Funds (Retirement Class) TIAA-CREF Money Market Fund (Retirement Class) Lifecycle funds Asset diversification among asset classes Automatic rebalancing A money market mutual fund Seeks to assure the value of your investment at $1 per share CORE PLUS FUNDS Additional Mutual Funds based on institution s election Some TIAA-CREF proprietary funds Some non-proprietary funds from other mutual fund families Core Plus Funds subject to Plan Sponsor election. 6

7 Why You Need to Save Now 7

8 Health Expenses in Retirement Can Add Up Medicare Supplemental Insurance Dental Parts A, B & D deductibles Parts B & D* premiums Part D Coverage Gap cost share Part D (True Outof-Pocket) TrOOP Premiums for all insurance Out-of-pocket medical costs Co-pays and co-insurance Out-of-Pocket Expenses Vision Hearing Medical equipment Long-term care Nursing Home *Part D premium is indexed to income. 8

9 Medicare Is Not Enough Other 14%* Medicare 59% Out-of- Pocket 13% Private Insurance 14% Source: EBRI estimates from the 2009 Medical Expenditure Panel Survey. *VA, Tricare, other private, Medicaid, other. 11 9

10 SAVINGS Save Early and Consistently The power of compounding Just by saving $100 monthly $300,000 $250,000 Potential account earnings Contributions Total: $264,012 $216,012 $200,000 $150,000 $100,000 $50,000 Total: $17,409 Total: $52,397 $28,397 Total: $122,709 $86,709 $0 YEARS OF SAVING $5,409 $12,000 $24,000 $36,000 $48, years 20 years 30 years 40 years These examples are intended for illustrative purposes and are not a prediction of investment results. Your own Plan account may earn more or less than this example. Actual account balances will be determined by the contributions made and any investment gains or losses. Investing in this manner does not ensure a profit or guarantee against loss in declining markets. These examples do not take fees into account and actual balances will generally be reduced by fees. Contributions and earnings accrue tax-free and are paid out tax-free for reimbursement of qualified health expenses. These examples are based on $100 contributions made at the beginning of each month and a 7% annual rate of return compounded monthly. Chart balances shown are end-of-year balances. 10

11 Keep This In Mind Building up tax-free assets for retiree healthcare protects your pension retirement income. Medicare cost shares are increasingly indexed to income. Investment and tax diversity are key. 11

12 Tax-Free Disbursements in Retirement $1,000 medical bill! Pay with 403(b) Retirement Plan Pay with Emeriti Health Account Tax-free withdrawal of $1, cents on the dollar Taxable withdrawal of approximately $1, cents on the dollar in 28% federal income tax bracket 12

13 13 Participant Education and Decision Support Tools Online In Print On the Phone In Person Coming Soon

14 Your Next Steps Contact your benefits administrator to begin payroll deferred voluntary contributions Watch for Emeriti s life stage communications Visit EmeritiHealth.org Register on the Emeriti Benefits Dashboard at MyEmeritiBenefits.org 14

15 Emeriti Program Fees Your employer may cover all or some portion of the service fees. Check with your institution s benefit administrator if you are uncertain. Monthly Participant Fees Fees Active Service Terminated/Retiree Emeriti $5.00 $5.00 TIAA-CREF $.67 $.67 Savitz $1.00 $6.00 Investment management fees are variable by selected mutual funds (see prospectuses) 15

16 Emeriti Retirement Health Solutions provided this information and is responsible for its content. Emeriti, TIAA-CREF, Savitz, Aetna Life Insurance Company, and HealthPartners are independent corporations and are not legally affiliated. The retirement healthcare program is offered by the employer. Teachers Insurance and Annuity Association (TIAA) will provide services to the plan and make available investment options. TIAA-CREF Trust Company, FSB provides investment management and trust services. Emeriti Retirement Health Solutions is not an insurance company, insurance broker or insurance provider. Summary Plan Description (SPD) This presentation is intended to provide you with a brief summary of some of the details of your Employer s Emeriti Plan and the Emeriti Program. For a full summary of the terms of your Employer s Emeriti Plan you must consult the SPD, which will be provided to you upon enrollment or upon request. 16

17 Investment Adviser Status Emeriti Retirement Health Solutions is a registered investment adviser for purposes of selecting the range of investment options available under the Emeriti Program. Emeriti may provide non-personalized educational materials to plan participants relating to their and their employer s contribution to their Emeriti Plan and the allocation of their Emeriti Health Account balances among available investment options. Emeriti does not provide personalized investment advice to participants. The participation interests in the voluntary employee contribution VEBA trusts associated with the Emeriti plans (the Interests ) may be treated as securities under federal or various state securities laws. The offering of these Interests is subject to compliance with any applicable federal or state law. For residents of Georgia, the Interests are being offered in reliance on paragraph 13 of Code Section of the Georgia Securities Act of 1973, as amended (the Georgia Act ). The Interests may not be sold or transferred except in a transaction which is exempt under the Georgia Act or pursuant to an effective registration under the Georgia Act. 17

18 Addendum 18

19 Emeriti Retiree Teleconferences Want information about Emeriti s Insurance Plan Options for 2014? Attend a teleconference Wednesday, November 20 at 3pm (ET) Wednesday, December 4, at 3pm (ET). For both calls, please call , and enter Conference ID:

20 Access 2014 Annual Enrollment Materials Click on ALREADY A PARTICIPANT tab EmeritiHealth.org 20