A Look Back at 2014

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For the MOSERS News Archive:
  1. 2014 COLA Rate Determined
  2. MOSERS Board of Trustees Candidate Biographies
  3. Security Update
  4. Registration Update
  5. 2014 Annual Benefit Statements
  6. How to Create Your Benefit Estimate
  7. Confused about Backdrop?
  8. Who to Contact at Retirement
  9. The Cost of Retirement
  10. 2015 Annual Optional Term Life Insurance Review
For Rumor Central (minus Friday Top Five, a popular series):
  1. Financial Security, Peace of Mind
  2. Real Retirees: James Broadfoot
  3. Legislator vs. General Employee Pay Increases
  4. Real Retirees: Randy Woods
  5. Debunked: Changes to Your Benefit Calculation Early Payouts
  6. Disability and Early Retirement
  7. State Budget Vetoes
  8. When Should Retirees Expect their COLA?
  9. Unpaid Vacation Leave
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Friday Top Five: Retirement Related News for 12/31/14

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From Huffington Post: Why 401(k)s Shouldn't Replace Pensions

It's not just basic finance, it's common sense: A large pool of money invested by professionals will yield far greater returns than small, separate accounts managed by individuals with no professional training in finance.

So why do some think that ending Illinois' defined benefit pension system and moving workers into privatized, 401(k)-style accounts is a good idea?

From USA Today: Retirement: How women can generate income for life

Many women have a "quiet fear" that they won't have enough money for retirement, but they can take several steps to make sure that doesn't happen.

"The key is to continue earning throughout retirement and to find ways to create income for life," says Donna Phelan, 62, who has worked with thousands of women nationwide during her 18 years with several large Wall Street investment firms. She has an MBA in finance and is the author of a new book, Women, Money & Prosperity: A Sister's Perspective on How to Retire Well.

From The Motley Fool: 3 Smart Retirement Moves to Make in 2015

The start of 2015 is right around the corner, and with it comes an opportunity to make three smart moves that can help you secure a more comfortable retirement.
Related -  A Deferred Compensation Carol.

From MarketWatch: 4 retirement-planning rethinks for 2015

Retirement security, if not the greatest, is one of the principal financial concerns of long-term investors.

For this reason, the new year provides a good time to reflect on your retirement plan and to make sure that you have put in place the strategies and tactics that can increase the probability of reaching your retirement goals.

From Business Insider: Here's The Most Important Thing Any American 25-Year-Old Can Do In 2015

As 2014 comes to a close, many folks prepare to commit to their 2015 New Year's resolutions.

We have a resolution for every 20-something in America who isn't saving for retirement: start saving now.

Because, with each day you wait to start saving, the difficulty of hitting your retirement goals literally compounds. Literally.

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Final Average Pay

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I have seen several times on Rumor Central a reference to "final average pay" as part of the retirement benefit calculation. The word "final" makes me think the calculation is based on one's last years of employment prior to retirement, but I thought I saw elsewhere that the calculation is based on one's highest three years of salary, no matter when they occurred. Please clarify; thanks.
Final Average Pay, or FAP, consists of your highest 36 full consecutive months of pay, no matter where in your pay history that may happen to fall. (Practically speaking, for most, that is their last three years but not always.) The only exception to this would occur under the BackDROP. If you become eligible for and elect the BackDROP upon retirement, your highest 36 consecutive months would be determined from your work history preceding your BackDROP date. In other words, if you elect BackDROP, your pay during that period would not be used in calculating your monthly benefit.

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Friday Top Five: Retirement Related News for 12/26/14

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From CBS Money Watch: How to turn cheaper gas into retirement savings

The lowest gas prices in years isn't only an opportunity for motorists to cut fuel costs -- it's also a chance to fill up your retirement savings.

Indeed, although cheap gas can boost the U.S. economy as a whole, many people would benefit more by squirreling the savings away in an IRA or 401(k) account.

Fidelity Investments recently released a chart showing how much a budget windfall could build over time if it were saved for retirement.

From USA Today: Three ways to improve your retirement planning

Many people are behind when it comes to retirement planning.

But it doesn't have to be that way. There are some easy and, quite frankly, painless ways for you to get in front of proverbial eight ball. Here's what experts recommend.

From BenefitsPro: Terrified about health care in retirement

There’s nothing like worrying about healthcare, especially how you’ll pay for it in retirement.

That’s the concern of more than 62 percent of boomers who have not yet retired, and who say they are “terrified” about the costs of healthcare destroying their retirement or making it altogether impossible.
Related -  CLAIM is available for all state employees needing guidance through Medicare decisions.
MCHCP provides information on Retiree health care plans

From The Motley Fool: 3 Investing Resolutions Worth Keeping

The new year is right around the corner, so now is the perfect time to consider this past year's successes and failures and determine what profit-friendly actions should be taken in 2015. In that vein, here are three resolutions investors might consider keeping in the coming year.

From Huffington Post: 5 Retirement Planning Steps Most People Overlook

Your retirement date is rapidly approaching. You're in good financial health and you feel well-positioned for a secure retirement.

But you're still worried you might be overlooking something.

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Raising the Temporary Benefit Age

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Has there ever been any legislation to up the age for the temporary benefit if you retire before 62? Reason being, this is supposed to offset being eligible for Social Security, but everything I look at SS it says I will not be eligble until 67.
To the best of our knowledge there is no effort to change the age (from 62 to 67) at which the temporary benefit ends in the MSEP 2000. The federal law that gradually raised the age to receive full social security benefits went into effect with the 1983 social security amendments, but the age for early social security eligibility remained at age 62. The MOSERS temporary benefit became law on 7/1/2000 and was designed to serve as a bridge between your MOSERS retirement and your eligibility for early social security benefits. At age 62 the temporary benefit stops. It is a personal decision, with pros and cons on both sides, to take early/reduced social benefits at age 62 or wait until you are eligible for full social security benefits. We encourage you to talk with a financial advisor or staff at the Social Security Administration to help you decide which is best for you individually.

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Friday Top Five: Retirement Related News for 12/19/14

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Only a small percentage of retirees are directly affected by the new rule. But future legislation may lead to more pension cutbacks.

The last-minute deal to allow retiree pension benefit cuts as part of the federal spending bill for 2015 passed by Congress last week has set off shock waves in the U.S. retirement system.

Related -  Rumor Central’s Federal Pension Changes

The Missouri State Employees Retirement System (MOSERS) reported that someone gained "unauthorized access" to four members' accounts.

The hacker or hackers filled out online forms that required the use of the members' Social Security numbers, retirement identification numbers and passwords, according to news reports. Candy Smith, the retirement system’s communication and strategic planning coordinator, told the Jefferson City News Tribune attempts to get money were detected, and no money was released.

Almost 700 Missouri government retirees renewed their online access to account information Tuesday, the Missouri State Employees Retirement System (MOSERS) said.

“We did have 686 members who established a new password today and logged into their member homepage,” spokeswoman Candy Smith said Tuesday afternoon. “Staff were on the phones all day assisting members and are available Monday-Friday, from 7:30 a.m. to 4:30 p.m.”

Related -  Registration Process Update

The need for guaranteed income in retirement planning is crucial as the shift continues away from defined benefit to defined contribution plans, according to new research sponsored by Prudential Financial, Inc. (NYSE:PRU).

The findings of the latest National Retirement Risk Index (NRRI), published by The Center for Retirement Research (CRR) at Boston College, reveal households with access to a workplace retirement plan are less at risk of not being able to maintain their standard of living in retirement. In addition, the type of plan is also a key factor: 20 percent of households with a defined benefit plan through their current employer are at risk, while 53 percent with only a defined contribution plan are at risk. That compares to 68 percent with no plan at all.

Boone County will grant employment, retirement and survivor benefits to same-sex couples at the new year after a string of court cases chipped away at Missouri’s constitutional ban on homosexual unions.

“The county offers health insurance, dental and life insurance for married spouses regardless of the gender of the partners. As long as they have a valid marriage license, they are considered a spouse under our benefits plan,” Boone County Human Resources Director Jenna Redel-Reed said.

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Returning Withdraws to Deferred Compensation Plans

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A previous Rumor Central answer says that retirees can keep their savings in the Deferred Comp plan, but after age 70 aren't we required to make annual withdrawals which are then taxed? Can those withdrawals be put back into another Deferred Comp plan?
Per IRS rules, you are not allowed to rollover any part of a required minimum distribution (RMD). The following is a detailed description of required minimum distributions from the State of Missouri Deferred Compensation Plan.

Required Minimum Distributions (RMDs)
Tax laws require you to begin annual withdrawals, known as Required Minimum Distributions (RMDs), from your retirement accounts in the year you reach age 70½, or when you retire, whichever is later. The State of Missouri Deferred Compensation Plan reviews your account each year to ensure that you are withdrawing the minimum amount required by law. If you do not withdraw enough to satisfy your RMD, the difference will be paid to you by December 31st. If this is the first year you are required to receive a distribution, you will be sent your RMD in March of the following year.

If you are receiving periodic payments, your payment schedule will continue unchanged. However, if you have requested payments equal to your RMD, the State of Missouri Deferred Compensation Plan will adjust your payment amount(s) so that your RMD is satisfied. This adjustment will take place every January or at the time you establish an RMD-only schedule.

If you are not receiving periodic payments, you may establish one at any time, but you are not required to do so. Your account will be reviewed annually to ensure compliance with the regulations and any remaining RMD will be distributed automatically.

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How to Budget for the Holidays

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The holidays are upon us! Finances can add a lot of stress for families in the winter months, but you don’t have to turn into a Grinch! We’ve put together a list of 9 steps you can take to keep your gift-giving jolly this year.

1. Plan for Affordability, Not the Latest Craze

Too many holiday lists start by featuring the latest must-have items and gifts for all. Only after the holidays will some consider the important question: How will you pay for that? It’s a recipe to be broke.

Instead, make your holiday list by starting with the question – What can I afford? Choose gifts and make decisions based around that. After all, the holiday is only one day. You’ll thank yourself by starting your new year on a good note.

Start considering how much you’ll need for next year’s holidays and begin your new year with a savings pledge.

2. Have a List

A well thought-out gift will make more impact than a flash in the pan. Knowing what you want to give your loved ones may keep you on track and avoid impulse spending.

3. Do Online Research

A good way to check if your budget is realistic for what you intend to purchase is to do some online research before you hit the mall. Not only does it provide you a great way to gather ideas and market rates, you’ll also save time and energy by avoiding the mall simply for research purposes.

4. Go Simple on Unnecessary Items

There are a lot of items that aren’t needed during the holidays. Save your money and finite resources by not including them in your celebrations. Examples include:
  • Ribbons, bows, fancy tape, stickers, etc.
  • Holiday-specific tablecloths.
  • Massive money on outside lights – set your decorations on a timer or limit when you turn them on.

5. Make a Pact: No Unnecessary Gifts.

Don’t break your budget for unnecessary gifts! Consider skipping on gifts for coworkers and friends. You may find that they’ll be relieved not to have additional financial obligations.

6. Print Coupons/Vouchers and Hit Sales

Now the fun part! Doing your homework ahead of time will help you know the best price for items on your list! You can keep track of sales, coupons, and price patterns! Knowledge and a plan will also help curb impulse buying if you know you can get it cheaper in two weeks.

7. Kids Aren’t Retail Snobs

Hopefully, the young children in your life don’t value your love based on the price of your gifts, so don’t shell out big bucks unnecessarily! For example, if you know your toddler is more interested in the packaging than the gift, consider wrapping several boxes within themselves for the gift of an experience.

8. Set Price Limits and Spread the Cost Around

Setting price limits with friends and family is another helpful way to keep your budget. Some holiday traditions include gift games or Secret Santa, where each individual brings a single $5-10 gift. You can range from the thoughtful to the downright silly.

9. Delay the Holiday – Buy  During the January Sales

Many people know that retailers keep their prices high until after the main holiday and post-holiday gift card rushes are over. Consider getting large, costly purchases after the price drops in January.  It also allows you some time to spread the cost across both December and January paychecks so you won’t have to incur extra debt!

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Federal Pension Changes

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the Governor of Kansas is cutting the State's contribution to their State employees pension system; can Missouri general Assembly, or the governor, do likewise? With the above, as well as Federal legislation regarding cutting other types of pensions, how concerned should we retirees be?
Your MOSERS benefits are secure. The recent federal pension changes do not apply to governmental pension plans like MOSERS. There are a few states that have announced cuts to actuarially determined contributions to their state employees’ retirement plans.  Unlike those states, the state of Missouri has consistently fully funded the amount determined by an independent actuary to be the contributions required to properly and responsibly fund the pension plan.  In addition to other negative ramifications, a decision to reduce contributions to MOSERS could potentially have a negative impact on the state’s bond rating, and thus increase the state’s cost of borrowing.

MOSERS has two sources of revenue:  1) Contributions by the employer (and employees in MSEP 2011), and 2) investment earnings. For the current fiscal year, the state’s contribution to MOSERS represents only 1.2% of the total state budget. Over the past 20 years, investment earnings have accounted for more than two-thirds of MOSERS revenues. See Key Facts Regarding Funding of the Missouri State Employees' Retirement System  and Not Your Average Pension Fund for additional information on this topic. The fact that the state has consistently made contributions on time and in full, combined with MOSERS above-average investment returns, saves money for the state, keeps contributions at a reasonable level, and strengthens the security of your benefit.

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Sick Leave & the Rule of 80

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Why can't we use out time (sick and annual) toward our 80 and out. If members were allowed to use their time toward the 80 and out, what kind of impact would that have?
Annual leave is not used in calculating your retirement benefit. Any unused annual leave will be paid by the agency you work for. You may want to contact your payroll/personnel officer to determine their procedure for paying out unused annual leave.

You will receive one month of credited service for every 168 hours of unused sick leave reported to MOSERS by your employer at the time you leave your position. Your sick leave is used in calculating the amount of your retirement benefit, but cannot be used to determine eligibility. For example, if you have 336 hours of unused sick leave, you will receive credit for an additional 2 months of service (336/168=2) when your retirement benefit is calculated. This 2 months of sick leave will not get you 2 months closer to retirement however; as we cannot use it to calculate when you are eligible.

The plan design reflects the policy that retirement eligibility is based on age and actual service rendered. The statute states a member has to be eligible for retirement in order to receive the additional sick leave credit. There would be a cost to change that policy because we receive retirement contributions to fund the benefits based on actual salary only;  no retirement contributions are paid on sick leave and annual leave. 

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2015 Legislation Rumors

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Have you heard of any legislation that would allow the reduction of our retirement amounts? I have read rumors to that effect.
MOSERS isn’t aware of any proposed legislation to that effect. The regular legislative session resumes in January of 2015, so we will monitor any retirement-related bills and continue to keep our members informed. You can follow the status of all public retirement bills on the Joint Committee on Public Retirement’s website at www.jcper.org.

You might also be thinking of the proposed federal retiree pension changes in the news lately. This issue wouldn’t affect state employees in Missouri.

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Friday Top Five: Retirement Related News for 12/12/14

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From StL Today: Pension system for most county employees will recognize gay marriages

Another public retirement system in Missouri has expanded benefits to members' same-sex spouses.

The latest decision affects employees and retirees of the 111 county governments covered by the County Employees' Retirement Fund. The fund's board voted unanimously last week to recognize same-sex couples who were wed in states where such marriages are legal.

From News Tribune: State employees' online retirement system hacked

Missouri government retirees won’t be able to access their information online until Tuesday morning — thanks to someone who managed to gain “unauthorized access” to four MOSERS members’ home pages.

MOSERS — the Missouri State Employees Retirement System — sent about 81,000 emails, and another 20,000 letters, on Thursday to members, explaining the situation, which follows “four successful attempts beginning last month to fraudulently complete an online form for active members of MOSERS.”

From Inside Higher Ed: Academics Prepared for Retirement

The economic downturn appears to have pushed back the timeframe for many higher education employees to retire -- but when they ultimately do, they will be better prepared financially and otherwise than other Americans, a new survey suggests.

The survey, by the pension giant TIAA-CREF, asked a group of higher education professionals a set of questions about their retirement plans and preparation, and compared those findings with a similar survey of all Americans.

From NPR: That Nest Egg Needs To Last As Long As You Do. So How Do You Start?

Retirement for baby boomers will look different than it did for their parents — Americans are living longer, health care costs more, fewer people have pensions today, and many people facing retirement haven't saved much.

All of that makes managing the nest egg you do have even more vital. But many people need and want guidance on what they should do to make sure their retirement savings last.

From CNN: Ditch 'The Number' and find a realistic retirement savings goal

You'd never know it for all the attention "The Number" gets in retirement planning. But the fact is that the road to retirement has far too many twists and turns to pin down your savings effort to any single number -- magic or otherwise.

But that doesn't mean you shouldn't have some sort of target to help you get and stay on track toward a secure retirement. Research shows that people who have a goal are more than twice as likely to feel confident about accumulating the savings they'll need.

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Winter Financial To-Do

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Between the holidays, end-of-year planning, and travel, this time of the year can be the busiest months for some.  By keeping track of your finances and avoiding over-extending yourself, you can help avoid starting the new year on a sour financial note. Here are a few things to help you get started!

1. Budget for Charitable Donations

Now that the season for giving is upon us, you may find yourself giving too much (or not being able to give enough). Determine your annual charitable budget and start saving for next year! You can set up an automatic transfer from your checking to a savings account earmarked for donations.

2. Start Researching Financial Aid for College Costs

The government starts accepting applications for financial aid January 1, and the sooner you or your child can submit the application, the better your chance for maximizing aid. Learn more about FAFSA deadlines here.

3. Review your Credit Card Health

Responsible use of credit cards can be a great boost for your credit. Building a strong credit history and score can help you get a better interest rate on mortgages or other loans, but your credit cards can cause your scores to crash if you don’t watch your credit to debt ratio. Keep tabs on your credit spending during the holiday season to make sure you aren’t over-extending yourself and haven’t lost your information to holiday Grinches.

If you’re concerned about how much debt you should take on (or just want a helpful guide to start), check out our Money Matters workbooks for helpful guidelines and worksheets.

4. Update Your Passwords & Commit to Internet Security

The Internet is one of the most powerful tools available. But along with technology must be an ongoing commitment to ensuring protection of your financial identity. 
  • Change your computer and online passwords frequently (every 90 days is a nice rule of thumb)
  • Use complex login passwords
  • Install antivirus software
  • Don’t open attachments or click links on strange websites
As a reminder, MOSERS will never solicit your information through an email. When you contact us, we will ask you to provide information to confirm your identity.

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Friday Top Five: Retirement Related News for 12/5/14

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From TroyMedia: Public sector pensions fare better in defined benefit model

Within the pension industry, thoughtful discussion about ideal pension plan designs has moved beyond the defined benefit versus defined contribution debate to focus on a broader range of pension plan designs and reform options.

From The New York Times: Retirees Turn to Virtual Villages for Mutual Support

RICK CLOUD, 68, knew that he wanted to stay in his home in Austin, Tex., as he aged. But Mr. Cloud, who is divorced, was not sure how he could do that without relying on his two daughters.

Then he ran across the idea of virtual retirement villages, whose members pay a yearly fee to gain access to resources and social connections that help them age in place. Sold on the concept, Mr. Cloud joined with some friends to start Capital City Village four years ago.

“Our virtual village can connect me with people my own age so I can do more things,” said Mr. Cloud, a retired technology consultant. “I worry about being single and getting older.”

From Time Money: Flunking Retirement Readiness, and What to Do About It

Americans don't get the basics of retirement planning. Automating 401(k)s and expanding benefits for lower-income workers may be the best solution.

Imagine boarding a jet and heading for your seat, only to be told you’re needed in the cockpit to fly the plane.

Investing expert William Bernstein argued in a recent interview that what has happened in our workplace retirement system over the past 30 years is analogous. We’ve shifted from defined benefit pension plans managed by professional financial pilots to 401(k) plans controlled by passengers.

From Pensions & Investments: NIRS study: DB plans still more cost-effective

The structural cost advantages of defined benefit plans over defined contribution plans has not changed in recent years, despite DC enhancements, said a research report released Thursday by the National Institute on Retirement Security.

The report revisits 2008 NIRS research that found a typical large defined benefit plan provides the same level of retirement benefit at half the cost of a defined contribution plan. In the 2014 report, “Still a Better Bang for the Buck: An Update on the Economic Efficiencies of Defined Benefit Pensions,” a typical DB plan has a 48% cost advantage over DC for an identical level of benefit, despite DC enhancements like target-date funds and annuities.

From Connect MidMissouri: Are same-sex divorces legal in Missouri?

A man who married another man in Iowa is asking Missouri to grant the couple a divorce, even though the state does not recognize same-sex marriages.

An attorney for a man identified in court documents as M.S. argued before the state Supreme Court Wednesday that Missouri should allow divorces for same-sex couples legally married in other states.

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MSEP 2000 Qualifications

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i started working for doc on 3-13-2000 my ? is am i eligible for the mesep 2000 retirement plan?
Yes, if you first worked in a MOSERS benefit-eligible position prior to July 1, 2000 and are vested in the MSEP (The vesting requirement for general state employees in MSEP and MSEP 2000 is 5 years of creditable service.), then you are a member of the MSEP, and at retirement you may remain in the MSEP or elect the MSEP 2000. (Keep in mind, members may be eligible for retirement in both plans on the same date or different dates, depending on their individual combination of age and service.) For more information about plan eligibility, see Which Plan Am I In? on MOSERS’ website, then you can find the specific age and service requirements in the appropriate member handbook or on the summary of benefits comparison brochure. Print Friendly and PDF

Are Post-Retirement Contributions Possible?

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After I retire from State Service, may I continue to contribute to the Missouri Deferred Plan?
No. Once you retire from state service, you may no longer contribute money to the deferred compensation plan. However, you can keep your account balance within the Plan for the duration of your retirement. In fact, many state employees taking advantage of BackDROP roll their lump-sum payment into the deferred compensation plan at retirement. There are several advantages to keeping your money in the Plan after you leave state service, including:
  • Access to free training and consultation services from the Plan’s education specialists. These are trusted professionals who do NOT earn commissions on the amount of money you hold in your account or the investment options you choose within the account.
  • Access to custom, low-cost investment products not commercially available elsewhere.
  • Convenient online account access where you can perform a number of transactions, like setting up automatic installment payments during retirement.
  • Account consolidation features that allow you to roll other retirement savings accounts (from previous employers, for instance) into the deferred compensation plan. This approach combines your accounts in retirement, making it easier to manage your savings.
For more information, go to www.modeferredcomp.org.

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Public Pension Exemption

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I am retiring in the Spring of 2015, will my retirement be taxed by the state or does it meet an exemption? Will I have to pay taxes on my retirement benefits each year?
Yes, as long as you reside in Missouri, each year your retirement benefits are subject to Missouri state income tax and federal tax. All or part of your pension payments MAY be exempt depending on your situation. As mentioned in the winter issue of RetireeNews, there is a public pension exemption that can be deducted from your retirement benefit, if you are eligible. Depending on a variety of factors (including, but not limited to, income, filing status, and age) you may be able to deduct a portion of your public retirement benefit on your Missouri tax return, to the extent the amounts are included in your federal adjusted gross income. MOSERS recommends you contact the Department of Revenue or a qualified tax advisor for additional information or answers to your specific questions about the public pension exemption.

The only taxes MOSERS will withhold from your monthly pension benefit are federal and Missouri state taxes. You will elect how you would like us to withhold these taxes by completing our Substitute W-4P form (available online) when you apply for retirement. You may change your withholding amount at any time.
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Garnishment of Retirement Benefits

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Can MOSERS retirement benefits be garnished?
Your benefits from MOSERS are not subject to execution, garnishment, attachment, writ of sequestration, or any other process or claim, except with regard to the collection of child support or maintenance, payment made to a former spouse pursuant to a division of benefits order, or an IRS levy. Print Friendly and PDF

Friday Top Five: Retirement Related News for 11/14

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From National Mortgage Professional: New Survey Proclaims Missouri as a Retiree Paradise

Where is the best place for Americans to retire? According to a new report issued by Livability.com, the 65-plus crowd would do well to plant their roots in Springfield, Mo.

How did Missouri’s third largest city become a new potential Mecca for retirees? According to Livability.com editor Matt Carmichael, the traditional concept of spending twilight years in sun-drenched resort areas is no longer prevalent with aging Baby Boomers.

From The New York Times: Finding, and Battling, Hidden Costs of 401(k) Plans

Like millions of retirees who assumed their companies had taken care of them, Ronald Tussey never thought that his retirement plan might be flawed. He trusted his company so much he kept his money in his 401(k) long after he left.

Having worked as an engineer for 37 years, ultimately at ABB Inc., where he retired 11 years ago, Mr. Tussey said he never paid much attention to the fees in his retirement plan and “assumed the company was looking out for my best interests.”

From Time Money: The 3 Best Ways to Boost Your Spending Power In Retirement

Location, location, location
You’ve heard the old saw that the three most important things in real estate are location, location, location. Well, that truism can apply to retirement too. Depending on where you retire, you may be able to dramatically boost the spending power of your Social Security check and your retirement nest egg, not to mention improve the quality of your post-career life.

Relocating in retirement isn’t the right strategy for everyone. If you like and can afford your house, have a solid network of family and friends to socialize with, and you enjoy your neighborhood and all it has to offer, you may not want to consider a change.

From BenefitsPro: On retirement, sponsors and employees disagree, a lot

It isn’t because they don’t care, or aren’t trying, but plan sponsors could be doing more to help workers save for retirement and often don’t see eye-to-eye with their employees on just how best to do that. 

That’s according to “Assumptions, Assessments and Actions: Plan Sponsor Views of Participant Support and Advisor Partnership,” a national survey of plan sponsors conducted by American Century Investment Services of Kanas City, Missouri. 

From Motley Fool: 3 Ways to Overcome Retirement Worry

According to the Employee Benefit Research Institute, or EBRI, 24% of people are not at all confident about having enough money for retirement, and 37% describe themselves as only "somewhat confident."

That's a worrying majority of people who aren't feeling very confident about their golden years. Luckily, the EBRI dug into the data and found some of our biggest sore points about retiring. Here are three seemingly small but critical ways to gain more confidence about your retirement. 

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Which Plan Am I In - Reemployment

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My niece worked two years for the State at a benefits covered position prior to 2011. After a few years absence, she has recently been reemployed with the same agency. Will the new 2011 pension rules apply (with regard to vesting and personal contributions), or will she be eligible for the old MSEP 2000 plan?
If your niece worked for the state as described in a MOSERS (or MPERS) benefit-eligible position prior to January 1, 2011, she would most likely be in the MSEP 2000.  The date on which she was first hired in a benefit-eligible position determines her plan membership.  For more information about plan eligibility, see the  Which Plan am I in? section of our website. MOSERS members can check their plan membership by logging into their secure Member Hompage, clicking on Estimates, then Estimate Your Retirement Benefit or by looking at their Annual Benefit Statement available via Online Documents. Also, MOSERS benefit counselors are available by phone at (800) 827-1063, by online chat, and by walk-in visits to our Jefferson City office Monday-Friday 7:30—4:30 if she would like more information about her specific situation.

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How to Withold Out-of-state Taxes

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I am retiring March 1, 2015 and I will be moving to Indiana. I realize I do not have to pay State taxes in Missouri on my benefits. However, I have been told that Indiana's tax on my retirement benefits will be 4.44%, what, if anything do I need to do about that. And is there anything I need to do before my actual retirement date March 1 2015?
For your retirement benefit payment, MOSERS will not withhold taxes for any state other than Missouri. We recommend you contact the appropriate state and local tax authorities to determine the taxability of your MOSERS benefit.

We would suggest that you specify your tax withholding preferences by completing a Substitute W4-P (Tax Withholding for MOSERS Benefit Payments) form when you retire, which you can do by logging into your secure Member Homepage on MOSERS’ website.

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Retirement Date for Terminated Vested Employees

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I am a vested employee. If I leave state employment before my retirement date, at what age will I be able to start drawing my retirement?
Your retirement eligibility depends on which plan you belong to. Please see the Which Plan Am I In? section of our website if you aren’t sure which plan you are in, then you can find the specific age and service requirements in the appropriate member handbook or on the summary of benefits comparison brochure. As a terminated-vested member, your benefit payment options and eligibility for benefits will be based on the laws in effect on the date you leave state employment.

MOSERS sends letters to terminated-vested members letting them know when they will be eligible to receive benefits, but you don’t have to wait to hear from us. If you are not sure of your eligibility, a MOSERS benefit counselor can help - give us a call! Or, log in to your secure Member Homepage on our website. Be sure to keep your contact information up to date so MOSERS can continue to communicate with you. Once a year, we provide a newsletter for terminated-vested members called VestedInterest, which we can either mail or email to you. 

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Friday Top Five: Retirement Related News for 11/7/14

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From Time Money: Retirement Withdrawal Strategies That Can Pay Off Big

To figure out the right pace for your retirement withdrawals—and to avoid ending up in higher tax brackets—start planning before you stop working.

Having your own tax-deferred retirement account is a bit like having one of those self-titrating morphine buttons that hospitals use: Press it whenever you need quick relief.

From The Motley Fool: Retirement Planning: Half of You Answered "No" to This Critical Question

Bring up retirement planning and one of the first things a lot of people will think of is Social Security. And while this important social safety net plays a major role in retirement, a recent Pew study shows that the majority of people of all ages -- and more than 86% of young people -- believe that Social Security will pay either reduced or even no benefits when they retire.

In light of this, you'd think an increasing number of people would be saving for retirement, but it looks like that's not the case. A recent Bureau of Labor Statistics study reported that only 48% of people who worked in the private sector participated in an employee retirement plan. Let that sink in for a minute. Of the approximately 117 million private-sector workers in the U.S., potentially up to 61 million don't participate in a retirement plan through their work. 

From Next Avenue: Do Women and Men Differ As Retirement Savers?

Gender financial stereotypes abound. Women are risk adverse — to their detriment! Overconfident men trade more — to their detriment! Really?

We’ve tracked retirement savings behavior of more than 3 million Vanguard plan participants since 2000 and have seen a few consistent trends. (In our infographic, The Gendernomics of Retirement Saving, we highlight some of the gender differences observed in our data.)

From Deseret News: 5 ways to be retirement rich

It’s not all that surprising that, according to Gallup, Americans' No. 1 financial worry is whether or not they’ll be able to afford retirement.

But that doesn’t mean we should all just accept financial instability. Here’s a roundup of recent advice from experts to help you grow — or establish — your retirement reserves.

From BenefitsPro: Can better communication help employees save more?

When Diana Awed talks about retirement, she speaks of the “national challenge” ahead and its “implications for generations to come.”

She doesn’t dwell on the consequences, however, avoiding specifics around expectations that many middle-class and lower-income Americans will no doubt end up relying on family, friends and social services to survive after they either can no longer work or, in their old age, simply can’t find employment. 

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Do MSEP 2011 member contributions count towards limits?

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I am enrolled in the MSEP 2011 plan. I also contribute to a Roth IRA. Does the mandatory 4% of salary member contribution count towards my IRA annual contribution limits?
No, they are completely separate.  You can contribute the full amount into your Roth IRA and the 4% retirement contributions will not count against that.

If low Roth IRA contribution limits are impacting your ability to save more, remember that the State of Missouri Deferred Compensation Plan also offers a Roth (after-tax) savings option. The combined contribution limits for after-tax (Roth) and pre-tax savings in this plan are $17,500 in 2014 and $18,000 in the 2015 tax year. Savers over 50 or within three years of their normal retirement age can save even more by utilizing the Plan’s catch-up provisions

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Out of State Taxes

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After retiring, relocating to a state that doesn't have state tax. Will MO. still deduct state taxes from retirement checks/ money withdrawn from Deferred Comp.
For your retirement benefit payment, MOSERS will not withhold taxes for any state other than Missouri. We recommend you contact the appropriate state and local tax authorities to determine the taxability of your MOSERS benefit.

For the State of Missouri Deferred Compensation Plan, a mandatory 20% federal tax is withheld from all plan distributions. State taxes are not withheld, (unless you elect to do so), regardless of where you are living.

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Refund of Contributions for MSEP 2011

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A relative of mine has recently become a full-time state employee, but expects to work only two or three years. Since she won't become vested, will she be able to recoup her contributions to the retirement system?
Yes. An MSEP 2011 member who leaves state employment prior to becoming vested (10 years) may request a refund of their contributions. Interest will not continue to accrue on their contributions if they terminate employment prior to becoming vested. Members leaving a MOSERS-covered position have a number of options available for managing their pension assets. They may:
  • Option 1 - Leave their contributions with MOSERS (if they expect to return to a MOSERS-covered position.)
  • Option 2* - Rollover the total amount of their contributions plus interest into an IRA or qualified retirement plan.
  • Option 3* - Elect a combination rollover and cash payment (less applicable mandatory withholdings and IRS penalties).
  • Option 4* - Request a full refund (less applicable mandatory withholdings and IRS penalties).
Please see the Member Contributions (MSEP 2011) brochure on our website for more information.

* Please Note - By receiving a refund, terminated members forfeit all their credited service and any future rights to receive any retirement and long-term disability benefits, and rights to coverage through Missouri Consolidated Health Care Plan (MCHCP) other than as a dependent under provisions of COBRA. 

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Friday Top Five: Retirement Related News for 10/31

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From BenefitsPro: Retirement plan participation increased in 2013

Not since 2010 has the percentage of workers participating in an employment-based retirement plan risen, but in 2013 it finally did.

So says a report from the Employee Benefit Research Institute, which found that in 2013, the percentage of all workers rose from 2010’s level of 39.7 percent to 40.8 percent.

From Huffington Post: 10 Things to Do to Prepare for Retirement

If retirement is on your horizon, there are 10 things to do now.

From US News: Investing: 2 men save same, end up $234K apart

Out here in Exampleland, Pete and Frank always leave Philadelphia at noon and pass Helen and Irma in Altoona at 4:30, but no one will tell you how fast they're going. And when you're planning for retirement, you can always figure out what percentage of your income you can save, but no one here will tell you what you'll have when you leave the office for the last time.

Today we're going to show why, and what you can learn from that — because you can always learn something in Exampleland. We're going to start with Joe, who started saving for retirement at age 30 in 1975 and retired at age 65. Joe's younger brother, Ralph, also started saving at age 30, but does so four years later. You'll soon see why Joe hates Ralph, and it's not because Ralph briefly dated Abba's Agnetha Fältskog while visiting relatives in Sweden.

From The US News: 4 Ways to Find Meaning In Retirement

Most of us paint mental pictures of happy stress-free days to be enjoyed in retirement. However, once you have rested up a bit, retirement can become mundane and even boring. You need to create your own fun and excitement and find a way to fill the hours with something meaningful. Here are a few ways to set yourself up for a fulfilling retirement.

From The Kansas City Star: Missouri pension system will no longer exclude same-sex couples

Same-sex spouses of state employees in Missouri who legally married in other states will soon be eligible for retirement benefits through the state employee pension plan.
Similar stories also appeared in the St. Louis Post-Dispatch and the Riverfront Times on Oct 27th and again in the St. Louis Post Dispatch on Oct 30th.

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Legally Married Same-Sex Spouses Are Eligible for Lifetime Survivor Benefits

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How does the recent ruling in Jackson ordering the state to recognize same sex marriages legally performed in other states and the Missouri Attorney General's decision not to challenge that decision affect MOSERS?
 In response to the Jackson County Circuit Court ruling and the Attorney General’s decision not to challenge the decision, the Board of Trustees of the Missouri State Employees’ Retirement System (MOSERS) took action on October 27, 2014 to change its policy and will no longer enforce section 104.012 of the Revised Statutes of Missouri (RSMo) which states, “For the purposes of public retirement systems administered pursuant to this chapter, any reference to the term “spouse” only recognizes marriage between a man and a woman”. This means that MOSERS retirees may elect a lifetime survivor benefit at retirement for their same-sex spouse to whom they were legally married in another state. Same-sex spouses of members who die prior to retirement may also be eligible for survivor benefits. The same laws and requirements that apply to legally married opposite-sex spouses will apply to legally married same-sex spouses.

The decision by the MOSERS Board will be implemented after the time for appealing the Jackson County Court decision has expired (November 13, 2014).

MOSERS members who believe they may be affected should contact a MOSERS benefit counselor to discuss the details of their individual situation at (800) 827-1063, (573) 632-6100 or mosers@mosers.org.

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Friday Top Five: Retirement Related News for 10/24

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From BenefitsPro: 401(k) contribution limits raised to $18K

Will it help Americans save more for retirement?

Perhaps, though the more immediate impact of the news Thursday from the IRS was to once more focus attention on the savings rates of workers and their “retirement readiness.”

The news was certainly welcome by the industry – cost-of-living adjustments that will allow participants next year in 401(k), 403(b), 457 plans and those in the federal Thrift Savings Plan to boost their maximum annual elective deferral rate to $18,000, up from $17,500.

From The New York Times: Making Sure Retirement Savings Don’t Run Out

We are living longer, but the life expectancy of our money may have trouble keeping pace.

The combination of longer retirements and more exaggerated cycles in financial markets heightens what financial advisers call longevity risk, the possibility of running out of money before running out of time. But adjustments can be made to investment portfolios, financial plans and lifestyles — before and after retirement — to limit the risk, they say, without increasing other risks.

From Huffington Post: Baby Boomers and Student Loans are Pouring into Retirement

No, your eyes aren't playing tricks on you. I knowingly wrote the words "baby boomers" and "student loans" in the same sentence. And yes, they are related. Surprised? So was I.

We talk a lot about the 10,000 baby boomers reaching age 65 every day and the challenges they face as they pour into retirement. One challenge rarely associated with baby boomers is how student loan debt is jeopardizing their retirement nest egg. Really? Student loan debt? That's a Millennial issue, right? Not exactly.

From USA Today: Investing: Can you retire on $1 million?

If you read any financial advertising, you know that your savings are inadequate, and you're likely to freeze to death in the dark a few weeks after retirement. For this reason, most Americans' retirement planning involves keeling over at their desks, or, failing that, starting a bomb-disposal unit as a retirement business.

But how much is enough? How about $1 million?

If results from the past decade are any indication, the answer is a moderately qualified "yes." The qualification depends on how much you withdraw each month, and how you invest it.

From Bank Investment Consultant: For Older Middle-Class Americans, Retirement Reality Check Kicks In

Investor optimism over their retirement readiness quickly fades with age.

That's one of the notable takeaways from the fifth annual Wells Fargo Middle-Class Retirement study released on Wednesday.

Almost half of the 1,000 middle-income Americans surveyed (48%) said they lacked confidence that they had saved enough for retirement. Among the older crowd—those between ages 50 and 59—the lack of confidence was much more prevalent, with 71% saying they hadn't saved enough "to live the retirement lifestyle they want."

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Retirement & Social Security

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Can I draw my MOSERS retirement check plus draw social security too?
Yes. In fact, the combination of your MOSERS defined benefit retirement plan, social security earnings, and personal savings & investment income form the foundation for a financially secure retirement. Use the State of Missouri Deferred Compensation Plan’s RetiremenTrack program to help you see how these three sources of income add up for your retirement.

You may have heard about the temporary benefit that is available to members who retire under the MSEP 2000 or MSEP 2011. The temporary benefit is available in retirement until a person turns age 62 but the MOSERS base benefit continues for life.  Workers can apply for early social security benefits, with a reduction, at age 62. However, the two are technically unrelated. There are many Rumor Central questions that may provide you with more insight.

We recommend that you get a MOSERS benefit estimate and contact the Social Security Administration at (800)772-1213 or visit www.ssa.gov for more information and details regarding your particular situation including your personal Social Security Statement.

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Friday Top Five: Retirement Related News for 10/17/14

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From CBS MoneyWatch: How much longer might you live? Think Again

Consider this: A 65 year-old woman has a 50/50 chance of living another 20 years to age 85, according to an online calculator maintained by the Society of Actuaries (SOA). Similarly, a 65 year-old man has a 50/50 chance of living another 17 years to age 82.

This information might cause you some confusion if you've read that the average life expectancy in the U.S. is currently 81 for women and 76 for men. But these are life expectancies from birth -- they don't apply to someone who's already reached age 65.

From CNN Money: Seniors lose average of $30,000 to financial scammers

Senior victims of financial abuse report losing big money to scammers, caregivers and even their family members.

According to a recent survey of 2,000 seniors and other adults by Allianz Life Insurance Co., elderly victims reported losing an average of $30,000, while some suffered losses of more than $100,000.

From Forbes: Start Now: A Step By Step, Tough Love Guide To Saving For Retirement In Your 20s

As Stuart Ritter instructed new T. Rowe Price hires on the retirement savings options available to them, a woman in the back of the room at a recent orientation started pounding on the table in front of her. The 53 year-old told her mostly 20-something colleagues that after she graduated from college she figured saving for retirement would be easier once she paid off her student debt. Then she fell in love, so she saved for a wedding. Then for a house, some kids and college for those kids. Easier never came and 30-years after college graduation she doesn’t have any money saved for retirement. Her message: Don’t let this happen to you.

“There will always be competing demands for you money,” says Ritter, vice president of T. Rowe Price Investment Services. “There will always be more things you want to buy than money to buy them with. So the sooner you get past ‘O, but, I don’t have much money’ the better off you’ll be.”

From USA Today: How to find your passion after you retire

Many people want to continue working well beyond the traditional retirement age, and to do that they're finding new creative ways to stay employed in not just one new career, but two, three or more careers.

Take Fred Weinberg of New York City who retired at age 55 after working for almost three decades as a New York State parole officer who tracked down missing parolees.

From The Motley Fool: What the Retirement Calculators Won't Tell You

Saving enough for retirement has become a huge topic for today's baby boomers. There's no shortage of retirement calculators out there to help you determine whether you have what you need to enjoy your golden years.

Given the great divide between what the average boomer has saved for retirement and what he or she needs, it's understandable that many believe tomorrow's retirees are headed for absolute disaster.

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October Financial To-Dos

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It’s T-17 days until Halloween, but your mind might be set on something scarier than cackling witches and skeletons – falling behind on your financial plans! Don’t worry, we’re here to help.
For state employees, October is all about looking ahead and making decisions that will affect your 2015 budget. Here’s a list of things that you might want to plan for or review this month:

1. Book your holiday plans

You probably haven’t decorated your house with Christmas trees or lights yet, but October is a great month to start planning for the festivities, especially if you’re planning on taking a plane, train, or bus. Generally, tickets are cheaper on Tuesdays. Here’s 6 more money-saving tips for travel.

2. Revisit your budget

Making decisions for your MO Cafeteria plan or health care plan might impact your budget. Take some time to revisit your monthly budget and find out how close you are to meeting your monthly goals, finding out whether you should cut back, or looking to see where you need to reallocate resources.

3. Revisit your worst-case scenario

Most MOSERS benefit-eligible employees have basic life insurance*, but have you taken some time to look at your Optional Life Insurance? Our fall PensionsPlus article covers the basics.
Additionally, you may want to go over your estate planning documents! These plans can cover anything from your social media accounts to who will handle the benefits for any minor survivors you’ve listed as beneficiaries. You may feel a sense of relief once these tasks are out of the way!

4. Re-evaluate your retirement plan

Although you may not be prepping for your golden years yet, you may want to take a peek at your savings strategy. Are you taking full advantage of your deferred compensation plan? Have you considered consolidating your retirement savings into one account?
Maybe you just want to dream about the future and get a benefit estimate. Log in to the secure Member Homepage, click Estimates and then Estimate Your Retirement Benefit.

*MOSERS’ life insurance is not available to employees of the Department of Conservation or state regional colleges/universities (except State Technical College of Missouri & Lincoln University), because those employers provide their own life insurance benefits.

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The post from April 27, 2005 describes an increase in the monthly benefit for years worked after age 65. Do these increases “count against” the 65% ‘Cap’ on the minimum 4% increases for those workers hired prior to August 28, 1997?
Note: the post referenced is here.

Yes, all COLAs accrued count towards the 65% cap for eligible members of the MSEP.

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Lifetime Retirement Benefit

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Is the retirement benefit for a lifetime? Had heard that you would only receive the benefit for 20 years.
Yes--once you meet retirement eligibility, your MOSERS retirement is a lifetime benefit based on your final average pay and credited service. MOSERS is a defined benefit plan, which provides a set benefit for life once you meet the age and service requirements for retirement. If you aren’t sure what retirement eligibility is for your plan, see the Which Plan Am I In? section of our website. More information can be found in our retirement handbooks. Print Friendly and PDF

Friday Top Five: Retirement Related News for 10/10

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From The Modesto Bee: Missouri benefits expanded to same-sex spouses

Missouri's main health care and retirement plans are expanding benefits to same-sex spouses following a court ruling requiring the state to recognize gay marriages performed elsewhere.

The decisions about state benefits come as Republican legislative leaders on Thursday continued to criticize Democratic Attorney General Chris Koster for not aggressively defending the state's constitutional prohibition of gay marriage.

Jackson County Circuit Court Judge J. Dale Youngs ruled last Friday that Missouri must recognize same-sex marriages legally performed in other states or countries — the first ruling to put a dent in the state's constitutional ban. Koster announced Monday that he won't appeal, stating that "Missouri's future will be one of inclusion, not exclusion."

From Plansponsor: Report Warns Against Moving N.J. Public Workers to DC Plan

A new report claims closing New Jersey’s defined benefit retirement plan for public employees and offering a defined contribution plan instead would be costly and would not solve the underfunding problem.

In “How to Dig an Even Deeper Pension Hole,” published by the New Jersey Policy Perspective, Stephen Herzenberg, executive director of the Keystone Research Center, says phasing out the state’s traditional pension plans and replacing them with 401(k)-type accounts would burden taxpayers with transition costs currently estimated at $42 billion and fail to reduce the state’s unfunded pension liability. In addition, moving employees from defined benefit (DB) to defined contribution (DC) plans has failed in three states that have tried it and was rejected by 13 other states after research concluded that the change would hurt taxpayers and pension recipients, the report observes.

From MarketWatch: What a strong dollar means for retirees

The U.S. dollar has been getting stronger relative to other currencies recently. The dollar has risen steadily for over 11 weeks and that’s the longest winning streak for the dollar since our currency became free-floating in 1973.

From Time Money: Why I Want a Real Retirement, And You Should Too

Looking forward to retirement seems irrational these days. Rising life expectancies and the increasing funding problems for Social Security and private pension plans have led to the recommendation that we defer retirement past the traditional age of 65—perhaps into our 70s and beyond. It’s getting to the point where many in my generation have started to assume that they might never retire at all.

It’s true that delaying retirement into your 70s will likely improve your financial situation. Yet in an age when work has come to permeate most of our waking hours, it seems even more important to delineate at least a decade when you’re still healthy enough to both reap the benefits of that hard work and devote your time to other pursuits. And yet the concept of a real retirement has come to symbolize financial irresponsibility or laziness or both.

From CBS Money Watch: Why so many workers retire earlier than planned

Half or more of all U.S. workers retire earlier than they had planned. The Retirement Confidence Survey from the Employee Benefit Research Institute (EBRI) reports that nearly one out of two -- 49 percent -- of retirees left the workforce earlier than they had planned. That finding is consistent with a recent report from Merrill Lynch/Age Wave that reports more than half -- three out of five -- retirees say they retired earlier than they had expected.

The reasons for these earlier retirements reflect the range of events and circumstances that people experience in their later years. The EBRI survey reports both positive and negative reasons for people retiring earlier than planned. On the positive side, 26 percent said they were able to afford an earlier retirement, and 19 percent just wanted to do something else.

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Buy-Out Option

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Is there a buy out option on my Missouri State Pension?
We answered a similar Rumor Central question back in August, which you can view here: http://mosersrc.blogspot.com/2014/08/early-payouts.html

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Debunked: Changes to Your Benefit Calculation

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Rumor has it that our benfit calculation will be changed to eliminate the number of years of services into the formula. Can you tell me if this is truth?
That rumor is false. The formula that MOSERS uses to calculate retirement benefits (which for general state employees is: final average pay x credited service x multiplier = monthly benefit) is defined by law. There was no legislation passed during the most recent legislative session  regarding a change to the formula. We reported in our 2014 Legislative Update the changes that were made. We are not aware of any proposals to change the formula in 2015.

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Missouri Auditor's Report on Public Pensions

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How did MOSERS fare in the recent Missouri Auditor's report on public pensions?
MOSERS is financially sound and our members can count on the benefits we administer now and in the future.

An important point to note about the auditor’s report is that it discusses the funding and performance of 89 Missouri public employee defined benefit plans as a whole. It does not rank the individual plans, but it does identify plans that are on a “watch list” that will be monitored closely in the future. MOSERS is not on the watch list.

One reason that MOSERS is financially sound is that the state of Missouri makes its annual required contribution (ARC) to MOSERS consistently and on time, as recommended by our actuaries.  See our key facts regarding funding of MOSERS. Because of this, MOSERS is not among the 34 plans referenced in the report that did not receive 100% of their ARC in 2012.

Another reason MOSERS is doing better than many pension plans is the majority of our funding comes from investment returns, rather than taxpayers. See why we are Not Your Average Pension Fund.

The data from the report was current as of 2012, when many public pension plans were still recovering from the effects of the recession. MOSERS’s investment performance currently and consistently outperforms its benchmark. This outperformance is the product of a prudent investment strategy that produces returns which add substantial value to the fund over time, as outlined in the final row of the table below. For instance, over a 20 year time frame, MOSERS' investment program has added $2.1 billion in value to the fund compared to a similar portfolio invested passively in the broad markets.

Missouri State Employees’ Retirement System
Investment Performance Summary (net of all fees and expenses)
As of June 30, 2014

 1 Year 3 Year  5 Year  10 Year  15 Year  20 Year 
  MOSERS   19.2% 10.4% 13.2%  8.6%  7.2%  9.4% 
  Policy Benchmark  17.7% 8.8%  12.2%  7.3%  5.5%  8.2% 
  Value Added  1.5%  1.6%  1.0% 1.3%  1.7%  1.2% 
  Value Added in Dollars   $117 M  $417 M  $432 M  $1.2 B  $2.6 B  $2.1 B 

Through a history of reasonable benefit levels, mandatory participation, consistent employer contributions, and professionally managed investments, MOSERS continues to be very viable in all respects.

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What does MOSERS' funding level mean for you?

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An article in the Springfield News Leader on Sunday discussed state public employee pension funds and their "funded percentage." It stated that it was desirable for pension funds to be funded at an 80% or higher level. It stated that the MOSERS fund was currently funded at 73%. Could you explain this shortfall and how it might affect my future pension income? Thanks!
The keys to successful retirement system financing are independent actuarial valuations, the employer’s commitment to contributing at rates recommend by the actuary, and a sound investment program. MOSERS has all three of those characteristics and is thus positioned to weather storms like the credit crisis that impacted all investors in the fiscal year ended June 30, 2009.  Over time, we have been smoothing in the losses sustained that year and that has resulted in the appearance of a declining funded ratio. Now that we are through with phasing in those losses, the system is experiencing increasing funded status.  For example, as of June 30, 2014, the funded ratio was 75% based on smoothed asset values and almost 80% funded based on the market value of assets. While there are impressions about the importance of being at least 80% funded, it is not nearly as important as the board’s and the state’s commitment to assuming that the system remains adequately funded as mentioned at the outset.  The state has always fully funded the required contribution as calculated by the system's actuary. The shortfall you referenced will not have any impact on your future pension income.

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MOSERS & Marriage

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I am fortunate to be single and I wonder what happens to my pension if I do get married after retirement. If I marry before retirement, will my spouse have a bigger pension if I die or does it make any difference at all? Many future retirees would like to know this answer.
The benefit payment options available to you at retirement depend on which plan you belong to and if you are married or single at retirement. If you aren’t sure which plan you belong to, check the Which Plan Am I In? section of MOSERS’ website. If married at retirement, you will have five benefit payment options to choose from; if single, you will have three (except for members of the Judicial Plan prior to 1/1/2011*). The joint & survivor options are available only if married.  See page 13 of the Retirement Guide or the Benefit Payment Options Summary on p. 17 of the PreRetirement Planning Reference Book for more information about benefit payment options. Regardless of the option you elect, you will receive a benefit payment each month for as long as you live.**

In general, once the first retirement benefit payment has been issued by MOSERS, you can’t change the benefit payment option you elected at retirement. One exception is if you are single at retirement and choose the life income annuity payment option but later marry. If this happens, you may change your payment option to one of the joint and survivor options if you make this election within one year from marriage. The new spouse must be designated as your beneficiary by submitting a Designation of New Spouse as Beneficiary for Retirement Benefits form to MOSERS.

If you marry and die before retirement, your surviving spouse would be eligible for a survivor benefit. The monthly benefit for your spouse will be based on the benefit you have accrued as of your date of death and calculated according to the Joint & 100% Survivor Option. The survivor benefit will be payable for the remainder of your spouse’s life. If there is no survivor spouse, 80% of your monthly base benefit will be paid to your natural or legally adopted child(ren) who are younger than age 21. If there are no dependent children, no survivor benefit will be paid.

If you marry and die after retirement, your surviving spouse would be eligible for a survivor benefit based on the election you made upon retirement, e.g., 50% Joint &Survivor or 100% Joint & Survivor.   

*Different provisions apply to judges who were members of the Judicial Plan prior to January 1, 2011.  Please see your Judge’s Retirement Handbook for more information.
**Unless you return to work in a MOSERS benefit-eligible position or forfeit your pension benefits due to felony conduct in connection with your duties as a state employee. 

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