Missouri Public Pension Exemption

Posted on
I have heard a rumor that the exemption from state income taxes for the state pension and deferred comp is going away. Please comment.
We are not aware of any changes to the Missouri Public Pension Exemption. We included a reminder about the exemption in the Fall/Winter issue of RetireeNews that is now online and on its way to mailboxes soon. For specific questions, we would suggest you contact the Missouri Department of Revenue or your tax professional. Print Friendly and PDF

Department of Corrections Rumor

Posted on
I JUST HEARD A VICIOUS RUMOR THAT MISSOURI MIGHT PRIVATIZE THEIR PRISON SYSTEM. IF THAT HAPPENS, HOW WILL IT AFFECT MY BACKDROP AND PENSION?
We are not familiar with that rumor. Any hypothetical privatization of services provided by the Department of Corrections would likely require legislative approval and/or action by the Governor.

MOSERS would pay any accrued pension benefits (including BackDROP) to employees once they reach retirement eligibility age & service based on the pension formula for general state employees as outlined in state law as of the date the member leaves state employment.

Print Friendly and PDF

Moody's Ratings

Posted on
As a prospective state employee, I am curious on how any municipal ratings changes by Moody's will affect payout on MO Pensions.
Moody’s ratings do not affect the amount of MOSERS pensions payments. As a new state employee, you would receive a Statewide Employee Benefit Enrollment System (SEBES) brochure with an overview of benefits, including those offered by MOSERS. Along with other benefits, we administer a defined-benefit (DB) pension plan with payments based on a formula as shown below. (The multiplier is determined by your plan; 1.6% for MSEP; 1.7% for MSEP 2000/MSEP 2011). We encourage you to explore the section of our website called “What Plan Am I In?” to read more about the specific provisions in each plan.

Pension formula for general state employees: 

Final Average Pay (FAP) x Credited Service x Multiplier = Monthly Base Benefit

Print Friendly and PDF

COLA This Year?

Posted on
I was just curious if there will be a cola this year and if so how much will my check be?
We calculate the COLA for benefit recipients each year. We do not know yet what the 2018 COLA rate will be because the required data is not yet available but we will calculate and announce it in mid-January. The COLA rate calculation is based on 80% of the percentage increase in the average Consumer Price Index (CPI) from one year to the next with a maximum increase of 5% (minimum 0%). The 2018 rate will be based on the comparison of the CPI in 2016 to 2017. COLAs are payable on the anniversary of your retirement date (for most retirees*).

Watch our website in January for more information, and learn more on the COLA page.  We will send you a notice, either in the mail or in your MOSERS Document Express online mailbox, when the COLA is applied to your monthly benefit payment.

*Exceptions:

  • Retirees who converted from MSEP to MSEP 2000 during the conversion window in 2000 have COLAs payable each year in July.
  • Retirees who elected a BackDROP will have COLAs payable each year on the anniversary of their BackDROP date rather than on the anniversary of their retirement date.
  • MSEP 2011 members hired after January 1, 2018 who leave state employment prior to retirement eligibility, will receive their first COLA in retirement on the second anniversary of their retirement.
  • Print Friendly and PDF

    How is Final Average Pay Figured?

    Posted on
    I'm thinking about retiring when I am 62 years old. I'm confused on which salaries would be used to figure my retirement. Is it the last 3 yrs of work, the 3 highest salaries, or the 3 highest consecutive salaries?
    Pay is one part of the three-part formula for general state employees:

    Final Average Pay (FAP) x Credited Service x Multiplier = Monthly Base Benefit

    Specifically, FAP is the average of your highest 36 full consecutive months of gross pay no matter where in your work history that may fall. Practically speaking, for most, it is during their last three years, but not always. (Note: If you become eligible for and elect the BackDROP* upon retirement, your FAP will be calculated using your MOSERS-covered work history prior to your BackDROP date.) 

    *BackDROP is available only to general state employees who are members of MSEP & MSEP 2000 and who work at least two years beyond normal retirement eligibility. 

    Print Friendly and PDF

    Retirement Process Timeline

    Posted on
    What is the earliest I can sign up to retire, prior to my retirement date.
     You can submit your retirement application up to 4 months (120 days) prior to your retirement date. There are specific due dates required for submission of your Retirement Application and Retirement Election Form.

    While most people think of their retirement date as their last day at work (when they pack up their things, say goodbye, and maybe have cake), for us at MOSERS, that is your “termination date”. Your “retirement date,” when it comes to getting your benefits from MOSERS, is the date you put on your Retirement Application and it will be the first day of the month in which you start receiving retirement benefit payments. For example, if a member’s last day at work is January 31, their retirement date could be February 1 and they would get their first payment from MOSERS on February 28. The timeframe to apply for a February 1 retirement date is October 1 – December 31.

    We encourage you to go to our website, log in to your Member Homepage, and retire online as soon as you have gathered information and made your decisions. Before your benefit payments can begin, you must complete the 2-step retirement process. This process, which involves your submission of several important forms, allows MOSERS to provide you with relevant, individualized information needed to make informed decisions regarding your future benefit payment. Use the Retirement Guide to assist you. This summary of the retirement process includes a detailed explanation of each form as well as a Smart Start Checklist of information you should have readily available when you apply. The Retire Online video also has helpful tips to lead you through the process.

    Print Friendly and PDF

    Losing BackDROP?

    Posted on
    I've hear a rumor that MOSERS employees are telling people that we need to retire soon because we will probably be losing our backdrop money. 
    Any changes to BackDROP, or any retirement provision, must go through the legislative process and be signed into law by the Governor.

    It is possible that someone misunderstood information from a MOSERS employee. If you elect the BackDROP* at retirement, it will likely reduce your monthly pension benefit amount because you are electing to take part of your benefit as a lump-sum and part of your benefit as a lifetime monthly payment rather than all of it as a monthly benefit.

    Another possible scenario that someone may have misunderstood has to do with the timing of one’s BackDROP period relative to when they otherwise would have been eligible for the Temporary Benefit. The Temporary Benefit is available to members eligible to retire under the MSEP 2000 through the Rule of 80. It is payable, in addition to the base benefit, until age 62. The BackDROP lump sum is calculated based on 90% of what you would have received in retirement benefits had you been retired during the BackDROP period. The maximum BackDROP period is 5 years. If someone had been eligible for the Temporary Benefit but worked until age 67 or older, the amount of the lump-sum payment might decrease.

    The BackDROP is simply a benefit payment option that is available to eligible members. Details related to BackDROP can be confusing! Members who are or may become eligible for BackDROP are encouraged to attend a PreRetirement Planning Seminar and/or make an appointment with a MOSERS benefit counselor for further explanation.

    *BackDROP is available only to general state employees who are members of MSEP & MSEP 2000 and who work at least two years beyond normal retirement eligibility.  

    Print Friendly and PDF