Out of State Income Tax and Your MOSERS Benefit

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If I move out of state is my Missouri pension considered income in Missouri and subject to Missouri state taxes since it's not earned income.
No, your MOSERS pension is not subject to Missouri taxes if you do not live in state. MOSERS will withhold state taxes only for Missouri residents. We recommend you contact the appropriate state and local tax authorities in your new location to determine the taxability of your MOSERS benefit.

You may specify your federal tax withholding preferences by completing a Substitute W4-P (Tax Withholding for MOSERS Benefit Payments) form, which you can do by logging into your secure Member Homepage on MOSERS’ website. If you do not choose one of the federal tax withholding options on the form, MOSERS is required by law to withhold federal taxes as if you elected married with three allowances.

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Travel Assistance

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I ran across an article regarding Travel Assistance. It says I am covered in the event I either pass away or get injured while traveling at least 100 miles from my home as long as I have Life Ins. with MOSERS. I need to know IF I pass first will my husband still be covered once he collects my life Insurance? We have Travel Insurance with our cremation plans so if we are covered here I want to possibly drop that part & save some money. We do a lot of cruising out of the US & it is good to know we are covered. Please advise.
As a participant in MOSERS life insurance, you are automatically covered under travel assistance, and that includes spouse or domestic partner and children under age 25. However, as the surviving spouse, your husband would not be covered by our life insurance or travel assistance, unless he is also a retiree, or working in a position covered by MOSERS life insurance.

Please see the United Healthcare Global Travel Assistance brochure on our website for more information.

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Friday Top Five: Retirement Related News for 6/26/15

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Knowing how much your significant other earns can make a big difference in how much money gets saved for retirement as a family. "When you are clear on how much each spouse earns, it creates a cap on spending and a reality around what you can afford," said John Sweeney, executive vice president of retirement & investing strategies with Fidelity Investments.

Some 72% of couples say they communicate exceptionally or very well about money matters, but 43% could not correctly identify their partner's salary, and 10% were off by $25,000 or more, according to Fidelity Investments' 2015 Couples Retirement Study. "It appears that couples have gaps in communication, and because incomes are shifting from year to year due to the freelance economy, it creates further challenges for couples to predict their own income," Sweeney said.

It’s no longer gay marriage. It’s just marriage.

With the Supreme Court ruling, spouses in same-sex couples will be eligible for social security benefits, and they will be covered under the survivor benefits rule for both defined contribution and defined benefits plans, Demmissie says. If both spouses are American citizens, they are also able to use the unlimited estate tax marital deduction at death to pass assets to a surviving spouse without incurring federal estate taxes. They are eligible to pass unused estate tax exemptions, as well as any gift tax exemptions, to a surviving spouse.

Related: Legally Married Same Sex Spouses Are Eligible for Lifetime Survivor Benefits

Housing is most Americans' most important source of retirement security. So a sharp reduction in the rate of ownership, coupled with rising rents, is taking a toll.

The housing bust of 2008 touched every homeowner. The subsequent recovery has been selective, mainly benefiting those with the resources and credit to invest. This has had a more damaging effect on individuals’ retirement security than many might expect.

From Wealth Management: When Retirement Comes Early

Scott Bishop is a financial planner in Houston, a city that has seen thousands of job layoffs this year in the wake of the collapse in oil prices. Many of the job cuts have hit executives at the big Houston-based oilfield services companies, so Bishop has seen his share of clients facing the prospect of an early—and unplanned—retirement.

“I’m talking with a lot of nervous, scared clients,” says Bishop, director of financial planning at STA Wealth Management.

Financial plans typically assume a normal retirement age in the mid-60s or beyond, but life events have a way of intervening. Half of all retirees say they left the workforce earlier than planned, according to the 2015 Retirement Confidence Survey conducted by the Employee Benefit Research Institute. The key culprits include health problems or disability and workforce downsizings.

Inequality has been increasing in multiple ways. But one little-appreciated form is the inequality of retirement time. That’s the number of years between retirement and death. It’s not surprising that divergent retirement time should reflect other forms of growing inequality. The poor have lower earnings and often work longer out of necessity, not choice. They are less likely to have decent pensions or private savings. On average, they suffer poorer health and tend to die younger. On all counts, the affluent get to enjoy more years of retirement in relative comfort.
Related: MOSERS Economic Impact on Missouri

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BackDROP and Sick Leave

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Can your accumulated sick time be used to get you to your next year of backdrop? Example: If you retired in January, could you use your accumulated sick time to get you to your retirement in March of that same year?
No. You will get one month of credited service for each 168 hours of unused sick leave you have at retirement. While this will increase the amount of your benefit, unused sick leave cannot count toward eligibility for retirement or as part of the BackDROP period. Print Friendly and PDF

Friday Top Five: Retirement Related News for 6/19/15

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From Business Advice Source: 9 Great Part Time Jobs For Retirees

Many people spend years planning and waiting for retirement. Days on the golf course and leisure travel opportunities seem like the finish line to a long career. But, many people get bored after the first few weeks of retirement. Many retirees find themselves looking for part-time work to fill their days and supplement their incomes. Here is a list of the top 9 part time jobs for retirees.

From United States Department of Labor: OSEC Congressional Testimony of Thomas E. Perez, Secretary

Thank you for the invitation to appear before the Subcommittee to speak about the Department's proposal to protect workers from conflicts of interest in retirement investment advice. As this Subcommittee explores the issues facing America's workers, I'm pleased to have the chance to discuss this rulemaking, and hope that we can continue to engage in a productive dialogue throughout the remainder of the comment period and the public hearing process. We believe that we have proposed a reasonable, middle-ground approach that is responsive to our extensive outreach and feedback. It is grounded in a basic principle — that investment advisers should act in their clients' best interest, not their own. The proposal remains open for comment in the Federal Register and I want to assure all stakeholders, including Congress, that the Department is very open to input to further refine, clarify, and improve this rule.

Retirement security is a fundamental pillar of the middle class. We must ensure that Americans who work hard and save responsibly for retirement are getting a fair share of the returns on those savings. This Subcommittee knows too well that there is a retirement crisis in America and that not enough Americans are saving for retirement. I'm deeply concerned that even if you've done the right thing, worked hard, and saved what you could, you could end up in a situation where you do not have what you need for retirement simply because your adviser isn't required to put your interests first. The majority of advisers already do the right thing and serve their clients' interests first, but most Americans do not have room for error and cannot afford to invest in products with unnecessarily high fees or low returns that benefit their advisers but do not meet their own needs.

From Forbes: When Should You Take Social Security Retirement Benefits?

For a lot of folks, the title question is a no-brainer: take the money and run. Why, you’ve been paying into this system all your life, so you should begin taking it back out as soon as you can, right?

Well, maybe.

From PlanSponsor: Oregon Legislature Approves State-Run Retirement Plan

The Oregon Senate has given final approval to a bill that would allow private-sector employees without an employer-sponsored retirement plan to join a state-sponsored plan.

The Portland Tribune reports that the bill will now go to Governor Kate Brown. It would create a board within the Oregon State Treasury to develop a plan similar to an individual retirement account, to which participating workers would contribute via payroll deduction. The plan would be modeled after the 529 Oregon College Savings Plan that is run under contract.

From Huffington Post: How Do I Save for Retirement with Student Loans?

When it comes to saving and investing for retirement, many recent grads opt to put it off in favor of repaying their loans first. Between living expenses, student loans, and recreation, it’s tough for young adults to find any money left over to invest in their future.

At Credible, we see student loan borrowers everyday at all stages of their lives seek options to better their finances and get financially ahead. Here’s what we think borrowers should know and some tools to help you start saving for retirement today.

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Friday Top Five: Retirement Related News for 6/12/15

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If there’s one subject that has the ability to impact kids throughout their entire lives, it’s personal finance. Unfortunately, it’s a subject that no one wants to teach them.

“The practicality of teaching [finance to kids] is so important…it’s the one topic that they’ll actually use for the rest of their lives, everyday. But it’s the one topic that isn’t really taught,” says Gregg Murset, chief executive of My Job Chart, an online tool that  teaches kids about responsibility, managing money and helping charities.

Seniors looking for a place to retire often look for ways to get the best value for the dollar, lest their fixed income soon become nonexistent. Here are five places in Missouri for the retirement-minded that combine amenities and necessities for retirees with an affordable cost of living.

For many of us, retirement is a great unknown. In your 20s, it seems so far away that it’s easy to figure you’ll start saving when you have more money. Of course, if you wait until you have “extra money,” you might never start at all.

But 20-somethings aren’t the only ones who do things that sabotage their retirement. Their parents may be putting their own retirement at risk by, for example, borrowing money to pay for a wedding, just when they should be turbocharging their own savings, especially if they started late.

Some of the most important preparations you need to make have nothing to do with your pocketbook.
Everybody knows about the need to set aside more in savings, 401(k)s, and IRAs. But for a second, forget about the financials. Some of the best retirement coaches in the country agree that some of the most important preparations you need to make have nothing to do with your pocketbook.

From The Street: Retirement Investing Is Moving to a Do-It-For-Me Model

NEW YORK (MainStreet) -- Employer-sponsored retirement accounts began as do-it-yourself savings plans. You decide if you want to save, and if so, how much (and how exactly) to invest. Unfortunately, many retirement plan participants were lost in the process. Rather than figuring it out, they just sat it out.
Faced with a workforce financially unprepared for retirement, employers are beginning to offer do-it-for-me options for their employees. Plan sponsors seem to be saying, “If you won’t do it, we’ll sign you up, invest your money and boost your savings rate along the way.”

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Friday Top Five: Retirement Related News for 6/5/15

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From PLANSPONSOR: Study: Many Older Households Lacking Savings

The GAO reports that maybe half of near-retirees have no money put aside.

The Government Accountability Office (GAO) has released a report indicating that many retirees and workers approaching retirement have limited financial resources. About half of households ages 55 and older are without  a 401(k) plan, an individual retirement account (IRA) or any other form of retirement savings.

From PLANSPONSOR: PSNC 2015: Top Trends in Retirement Planning

Anyone who has cut their teeth in the retirement benefits space knows perennial change simply comes with the territory.

[...] From the oft-cited decline of the corporate pension system to the boom in financial wellness programs in the defined contribution (DC) context, plan sponsors and their service providers are in the midst of great change, noted Sean McLaughlin, senior vice president for client relations and business development at Prudential Retirement. Greg Wilson, managing director and head of platform solution group for North America at Goldman Sachs Asset Management, echoed that sentiment and suggested plan sponsors today must confront a remarkably dynamic set of opportunities and challenges.

From EurekAlert!: Inexperienced investors should take advantage of 'auto-pilot investing'

COLUMBIA, Mo. -- For inexperienced investors with little knowledge about the investment process, it may be important to invest in funds that do not require much maintenance. Now, a researcher at the University of Missouri has found that investors with less investment knowledge are more likely to invest in target-date funds (TDFs). Michael Guillemette, an assistant professor of personal financial planning in the MU College of Human Environmental Sciences, says this is a positive trend which will help inexperienced investors invest safely without risking significant losses based on their lack of knowledge.

'If a potential investor without experience or knowledge is looking to invest in the stock market in order to build retirement wealth, it is not advisable for them to jump in and start investing in individual stocks, since they will be more likely to make investment mistakes,' Guillemette said. 'Target-date funds allow these unsophisticated investors to enter the investment world in a way that minimizes the opportunities for them to make mistakes.'

From BenefitsPro: Are retirement needs overstated?

The model used by many financial planners for retirement planning doesn’t accurately reflect how retirees spend during their early and middle retirement years, which means advisors might be overestimating how much their clients will need to save for retirement.

That’s according to the research of David M. Blanchett, head of retirement research for the Morningstar Investment Management Group. And although the headlines have been screaming for years that people aren’t saving enough for retirement, much less being told that their targets are too high, he’s receiving an award for his work.

From Forbes: The Immorality Of Pushing Pension Debt Onto Millennials

A recent study pegged the debt of state and local government pension plans at $4.7 trillion. If politicians and voters fail to adopt reforms, younger people will be stuck paying off a massive and growing debt they did not create or approve.

State and local government workers receive generous defined-benefit pensions that guarantee specific monthly payments to retirees for life. In theory, these pensions are paid for by investing contributions from government agencies and their employees, and using the proceeds to pay the promised benefits after employees retire.
Related: Key Facts Regarding Funding of MOSERS

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