PUBLIC EMPLOYEE RETIRMENT SYSTEM (PERS) Pension and Health Benefits at Retirement
TABLE OF CONTENTS Considering Retirement Before You Apply Retirement Timeline Tiers Types of Retirement Early Retirement Pension Options Payment Options Canceling/ Changing Retirement Group Life Insurance Health Benefits Medicare Costs Employment After Retirement Contact Info
CONSIDERING RETIREMENT To Work OR Not To Work
BEFORE YOU APPLY www.state.nj.us/treasury/pensions Utilize MBOS Utilize MBOS Personalized Member Account Info Online Application for the Purchase of Service Credit Access to Current Health Benefit Information Application for Withdrawal Access to other Pension links and forms MBOS for Retirement Retirement Estimate/ Calculators Estimates can be calculated up to 1 year in advance Apply for Retirement View Retirement Application Status Beneficiary Information Make change *You can also call 609-292- 7524 option 3
RETIREMENT TIMELINE 4-8 months before Retirement Estimate Apply for Retirement Provide Proof of Age Proof of DOB for beneficiary 1-3 months before SHBP enrollment application is online Loans arrears must be paid before 1 st check Board Approval After Retirement Statement of Retirement Allowance Direct Deposit and Tax forms sent 1 st check issued in 30 days.
TIERS TIER DESCRIPTION Tier 1 Hired before July 1, 2007 Tier 2 Enrollment between July 1, 2007 November 1, 2008 Tier 3 Enrollment between November 2, 2008 May 20, 2010 Tier 4 Enrollment between May 20, 2010 June 28, 2011 Tier 5 Enrollment after June 28, 2011
TYPES OF RETIREMENT Service No minimum years required. Based solely on Age Tier 1 & 2 Age 60 Tier 3 & 4 Age 62 Tier 5 Age 65
EARLY RETIREMENT If you have 25 years or more of service and are under 55 Tier 1 retire before 55, Benefit reduced by 3% (1/4 of 1% per month for each year under age 55). ** If you are 55 and over there is NO Penalty Tier 2 retire before 60 there is a penalty Between 55-60, benefit reduced by 1% per year (1/2 of percent per month for each year under 60 but over 55) Under age 55, benefit reduced by 3% per year (1/4 of 1 percent per month for each year under 55). ** If you are 60 there is NO Penalty Tier 3 & 4 retire before 62 Between ages 55 62, benefit reduced by 1% (1/12 of 1 percent per month for each year under 55). Under age 55, benefit reduced by 3% (1/4 of 1 percent per month for each year under age 55). Tier 5 At least 30 years of service retire before age 65 with 30 years service Reduced 3% per year (1/4 of 1 percent per month) for each year under age 65
MORE TYPES OF RETIREMENT Deferred Veteran Less than 25 but at least 10 Provide veteran paperwork to years of service AND not yet Division of Pension (copy of Age 60 Tier 1&2 DD214 or Discharge paperwork) for veteran status Age 62 Tier 3 &4 Age requirements are the same Age 65 Tier 5 Veterans meeting the age Once you reach the required requirement with 20 34 years age you will begin to receive of service credit, benefit = 54.5% payments of salary for last 12 months or Your group life insurance is highest year not in effect between the time Formula for 35 or more years of you terminate employment service at age 55: years of and retirement is effective. service / 55 X highest 12 consecutive months of salary
Example You are a Full Time GCC employee hired and enrolled in PERS on July 3, 2009. You are currently 60 years old and considering retirement. Are you eligible for retirement? And if so, what type(s) of retirement?
PENSION OPTIONS Payment Options Maximum Option (no pension to a beneficiary) Provides the benefit for the remainder of your life Other options will provide a smaller monthly benefit than the Maximum option so that your beneficiary will receive a lifetime monthly benefit upon your death Option A Option B Option C Option D
PAYMENT OPTIONS For all of these options, if your beneficiary dies before you your retirement allowance will increase to the max option. Option A 100% Lifetime monthly benefit to you, upon death beneficiary receives 100% of your benefit. Option B 75% Lifetime monthly payment, beneficiary receives 75% of allowance upon death. Option C 50% Lifetime monthly payment, beneficiary receives 50% for life. Option D 25% Lifetime monthly payment, beneficiary receives 25% of payment upon your death
OPTION 1 Reducing Retirement Reserve to a beneficiary At retirement, expected lifetime benefit is calculated (reserve). If you die before you reach your max reserve, your beneficiary is entitled to the balance. It can be paid in a lump sum or equal payments over 5, 10, 15, 20 years, or lifetime annuity. You may have more than one beneficiary and can change beneficiaries at any time. Beneficiary can also be a person, charity, institution, or your estate.
Remaining Three (3) Options Life expectancy of you and your beneficiary will be calculated at the time of your retirement; therefore, the younger your beneficiary the greater the percentage of reduction in your monthly benefit. Option 2 100% joint and survivor benefit. Lifetime monthly payment to you and at death your beneficiary will receive your monthly payment for life. If your beneficiary dies before your you will continue to receive the reduced retirement allowance. Can name only one (1) beneficiary and can not be changed after retirement
OPTIONS continued Option 3 50% joint and survivor benefit. 100% to you and 50% to your beneficiary at the time of death. Can name only one (1) beneficiary and can not be changed after retirement. Similar to Option C but if beneficiary dies before you, your monthly benefits remains reduced. Option 4 Choice of amount to beneficiary. Lifetime monthly payment to you and you decide the monthly allowance to be paid out at the time of death. Can name more than one (1) beneficiary but can not be changed after retirement If beneficiary dies before you, you will continue to received a reduced monthly benefit.
IF You Have Additional Retirement Options Contact: Supplemental Annuity Collective Trust (SACT) 1-609-633-2031 Defined Retirement Contribution Program (DCRP) 1-866-653-2771
Proof of Age Remember to submit your proof of Age for both you and your beneficiary Submit photocopies with your application Fax to (609) 292-6656
CANCELLING OR CHANGING YOUR RETIREMENT DATE You may change or cancel up to 30 days after your approval to the Board of Trustees or your retirement date (whichever is later) Canceling or changing your retirement date does not guarantee continued employment with your employer.
GROUP LIFE INSURANCE Active Employees 3 x salary Retired Employees Type of Death Before 60 Death After 60 Retirement Service & Veteran N/A 3/16 x salary Early 3/16 x salary 3/16 x salary Deferred N/A 3/16 x salary **You have the option to convert your insurance to the original amount through Prudential at 1-800-262-1112. Reference group policy G-14800
HEALTH BENEFITS IN RETIREMENT SHBP ENROLLMENT When you apply for retirement three (3) months in advance, Division of Pensions will send you a Retirement Letter. Which will advise you to go online to print out medical enrollment form You also want apply for Medicare Part B three (3) months prior to turning 65 WAIVING COVERAGE If you are waiving coverage, you still need to return the Health Benefits Enrollment Form within 60 days in case you ever lose your current coverage. If the form is not returned within 60 days you cannot pickup coverage at a later time.
MEDICARE Age 65 Part A & B You must enroll in Part A three (3) months prior to your 65 th birthday. If you are continuing to work at age 65, there is a special enrollment period for Part B. You must enroll for Part B coverage 3 months before retirement. Submit proof of enrollment to State Health Benefits Program Copy of your ID cards OR Letter from Social Security stating the effective dates of future Medicare Part B enrollment.
MEDICARE If your birthday is on the 1 st of the month, your Part B coverage will start the 1 st day of the previous month. **Make sure you apply 4 months in advance.. Otherwise, Part B starts the 1 st day of your birthday month. Social Security 1-800-772-1213 Month Enrolls Month Coverage Starts July August 1 August October 1 September December 1 October January 1
HEALTH BENEFITS COVERAGE COSTS THE STATE OF NEW JERSEY CHAPTER 48 If you have: 20 years or more of service as of June 28, 2011 and complete 25 years of service upon retirement The state pays for your health benefits. The state will reimburse your Medicare costs. If you have: 15 years of service and are at least age 62 upon retirement You will pay 1.5% of last years salary for benefits. You will be billed quarterly If hired after 5/1/2002, you will have single level coverage at retirement At age 65, Medicare becomes primary and college benefits secondary. The College does not reimburse Medicare costs.
Health Benefits Coverage Cost If you attain 25 years of service credit on or after June 28, 2011, or retire on an approved disability retirement you will become eligible for employer-paid post-retirement benefits; however, you will pay a contribution toward post-retirement medical coverage based on the applicable percentage of premium as determined by the annual retirement allowance. A minimum contribution of 1.5 percent of the monthly retirement allowance is required
ELIGIBLE DEPENDANTS FOR RETIREES If you were to pass away before your dependents, they are eligible for continuation of coverage under COBRA. For employees hired before 5/1/2002 Chapter 375 Spouse Civil Union Partner Domestic Partner Children Up to age 26 (coverage ends 12/31 of the year they turn 26) Coverage can be extended due to a child s mental or physical incapacity (request for continuance must be submitted within 31 days of term date). Responsible for the entire cost of coverage Ages 26-31 Unmarried Has no dependents Resident of NJ or FT Student No eligibility for dental or vision
CHANGES TO YOUR COVERAGE Change must be made within 60 days of the event Changes will be effective 60 days from the date the state receives the application. Qualifying Event Marriage Civil Union Domestic Partnership Birth Adoption of a child Death of dependent Change in partner/spouse s employment that affects the benefits offered by partner/spouse s employment Divorce/ Dissolution of Civil Union or Partnership Coverage ends the end of the month of the event.
EMPLOYMENT AFTER RETIREMENT Please contact Human Resources if you are considering re-employment after retirement. You can not make arrangements to return to the same/similar job prior to retirement There is a minimum 30 days leave requirement before returning to work If 10 month and retire 7/1 and not return until 10/1 (summer does not count). Fact Sheet 21
CONTACT INFO GCC Human Resources (856) 415-2112 Division of Pensions 609-292-7524 option 3 Pensions.nj@treas.state.nj.us AETNA HMO 1-877-STATENJ (1-877-782-8365) AETNA MEDICARE HMO 1-866-234-3129 NJ DIRECT 1-800-414-SHBP (7427) MEDCO is now Express Scripts 1-866-220-6512
Caren Sheppard (856) 415-2114 csheppa2@gccnj.edu