Allegheny Intermediate Unit
Education Association Retirement
Workshop
March 3, 2014
McGuffey Room, AIU
Keynote Speaker:
Denise Croyle
Past Chief Negotiator of AIUEA
Guest Speaker:
Dan Carey
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Terminology
1. PSERS Monthly Benefit: This is the
lifetime monthly payment you will receive.
2. Premium Assistance: This is the nontaxable, lifetime $100 monthly payment
you will receive for health care, if you
qualify.
3. Premium Share: This is the out-of-pocket
expense you must submit monthly in
addition to the Premium Assistance for
your health care until Medicare.
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© AIUEA, DG
Defined Benefit
PSERS
The retirement benefit is paid in two components.
1)Employee contributions and interest are paid in a
lump sum. In a defined benefit plan, a retiree can
take none, part or all of their contribution. You may
move it to a rollover: i.e. IRA, 403B, etc.
2)State and IU contributions are paid out monthly as
per your option choice. The monthly benefit is
based on the option chosen.
The PSERS retirement process requires you to
complete three forms: (a.) the application to retire,
(b.) your contribution decision form, and (c.) a direct
deposit form.
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When will I be able to retire?
Regular Retirement
• 35 years of service, retire at any age
• 30 years of service, retire at age 60
• Age 62, retire with 1 year or more of service
Early Retirement
• After 25 years of service, and a minimum age 55, with a
penalty of 3% per year below normal retirement with a
15% maximum penalty.
• After 5 years of credited service (vested) at any age with
a penalty of 7% per year below normal retirement with no
maximum cap.
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Retirement Timeline
- To be eligible for the retirement benefits,
employees shall notify the Allegheny
Intermediate Unit no later than March 30th
of each year of their intent to retire at the
end of that school year.
- Retirement at any other time requires 60
calendar days notice to be eligible for
retirement benefits.
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Recommended Procedure
1)Contact PSERS to obtain a retirement
estimate form. The form is available on the
PSERS website. www.psers.state.pa.us
2)Schedule an exit interview with PSERS.
**The option you choose is a lifetime choice
and cannot be changed after 45 days.**
3)Complete a retirement application with the
assistance of the PSERS staff.
4)Schedule an appointment with Janet
Breiding for the AIU benefit exit interview.
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PSERS Beneficiary
• You need to be certain to check your
beneficiary or beneficiaries on your
PSERS account. Look at the last
statement sent to you.
• You may change your beneficiary or
beneficiaries at any time.
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DART Employees
For DART Employees who retire after June
30th due to the stretch calendar, retirement
benefits will be granted per the school year
for which the DART stretch calendar is being
completed.
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Social Security
How to Apply:
1.) You must be 62 years of age and retired to receive the early reduced benefit
or wait until you are 66 years of age, or older for the full benefit.
2.) You can apply 3 months before your 62nd or 66th birthday.
3.) If you take the early benefit at age 62 your lifetime benefit will be 75% of the
full retirement age benefit at age 66. In 2014, if you are 62 to 66 years of
age, you are only allowed to earn $15,480.00 without losing benefits. The
year you turn 66 years of age, you can earn up to $43,410 before your 66th
birthday without losing benefits. After age 66 years of age, you can earn any
amount and not lose benefits.
4.) You can apply online and complete with a telephone interview or you can go
in person to a Social Security Office.
5.) For more information go to: http://www.ssa.gov/.
Advantage:
You will earn about $78,000.00 in benefits between ages 62 and 66. You will
have more money while you are young and can enjoy it. If you wait until age
66, or your normal retirement age with a higher benefit, you must live until
you are about 78 years of age to recoup this same amount of benefit.
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403B Tax Sheltered Annuity
• It is a long term savings account.
• You must be 59.5 years of age before you can withdrawal
without penalty under normal circumstances and work in
public education, the medical field, or in the U.S. Postal
Service.
• You can invest up to 16% of your annual salary into this
account.
• You can start a 403B with a bank, an insurance company,
or an investment firm that has been approved by the AIU
Board.
• You must begin to take withdrawals by age 70.5.
• This is tax deductible. When you file your federal taxes the
amount you pay is based on the amount taxed AFTER
this money has been placed into your account.
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© AIUEA, DG
403B Example:
You make $100.00 per pay and you contribute $15.00 per
pay to a 403B. Your net taxable take home pay is $85.00
per week.
$100.00
-$ 15.00 403B contribution
$ 85.00 net taxable pay
*Your contributions ($15.00 per pay) are not taxed until you
withdraw them after age 59.5 years of age.
**The advantage is a long term savings account with
compounding of interest
***With a Roth IRA the taxes are paid before going into your
account and never again.
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© AIUEA, DG
Section 82 - Retirement
Benefits
The AIU values the experience of
its veteran teachers and in no way
wishes to hasten their retirement.
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An employee at age 55 with ten (10) years of
AIU service, who elects to retire after June 30,
2011, under this provision, shall be eligible for
the continuation of the following benefits in
effect at the time of retirement:
- Choice of Allegheny County Schools Health Insurance
Consortium standard health
insurance plans,
consistent with
Section 71 – Fringe Benefits for the
individual
employees and dependents, if any.
- Dental
- Vision
- Life Insurance, if carrier permits
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Early Retirement Incentive
In the event that an early retirement
incentive is offered by the Commonwealth
of Pennsylvania after March 30th deadline,
employees will be afforded the opportunity
to retire regardless of age and receive the
benefits of Section 82 – Retirement
Benefits without penalty.
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Health Insurance Benefits Paid by
the AIU
Eight (8) years of benefits for retirement in
the 2013-2014 school year or Medicare
eligibility.
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Premium Share
• The employee shall contribute 7.25% of the
health care premium in the 2013-14 school year
with caps of $70 for individual coverage and
$145 for family coverage plus the amount the
retiree is eligible to receive from the PSERS
Health Care Supplement.
• For individuals who retire, the contribution and
caps for health insurance will stay at the fixed
rate of the year of retirement.
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Rate Increases
- All rate increases that occur in the foregoing
benefits shall be shared by the Allegheny
Intermediate Unit and the employee in the first
eight (8) years in the 2013-2014 school year of
the employee’s retirement or Medicare eligibility
(employee pays 7.25% of the premium).
- The employee’s share of the premium will not be
greater than the cap as established at retirement.
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Employee Insurance Purchase
The employee may purchase health insurance for
- Three (3) years at the end of the eight (8) year
benefit period provided for retirement in the
2013-2014 school year.
- At the Allegheny Intermediate Unit group rate.
The monthly stipend from PSERS will go to the
employee, not to the AIU.
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Continued Benefits
- Should the employee pass away prior to
exhausting the benefit, the insurance for
spouse/dependents shall continue for the
remainder of the benefit time period of the
employee.
- Thereafter, the employee’s spouse/
dependents may purchase insurance for a
period of up to three years at the Allegheny
Intermediate Unit group rate.
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Spousal Buyout
- An employee may elect to withdraw from
the Health Insurance benefit program
provided by the Collective Bargaining
Agreement.
- In lieu thereof, the employee will receive a
payment of $3,000.00 spousal buyout for
each school year that the employee does
not participate in the aforesaid insurance
program.
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HOP
• This is the Health Options Program offered
by PSERS once an individual reaches
Medicare eligibility.
• It is a health program, such as Highmark
Freedom Blue.
• Find more information and options at
www.hopbenefits.com or 1.800.773.7725.
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PSERS Premium Assistance
• You are eligible for Premium Assistance if
you are a retiree who meets one of the
following requirements:
– You have at least 24½ years of credited
PSERS service regardless of age, or
– You terminate school employment and
retire at or after reaching age 62 with at
least 15 years of credited service, or
– You are receiving a disability retirement
benefit from PSERS.
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PSERS Premium Assistance
- For an employee who qualifies, he/she
receives $100 monthly insurance benefit
from PSERS.
- Each month, the employee remits $100 +
the premium share to AMCA Systems.
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PSERS Premium Assistance
- For those who qualify, during the eight (8) years
of insurance benefits, the monthly stipend of
$100 from PSERS will be mailed to the
employee, who will in turn render it to AMCA
Systems.
- You must write a check for the monthly bill, you
cannot use a draft or credit card.
- During the three (3) year period of employee
insurance purchase, the monthly stipend of
$100 from PSERS will be kept by the employee
and not sent to AMCA Systems.
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PSERS Premium Assistance
• Even if you meet the eligibility
requirements, you cannot receive Premium
Assistance if you do not choose a medical
plan offered through HOP or if you do not
continue to participate in your former
school employer’s plan.
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PSERS Calculator
PSERS calculator
www.psers.state.pa.us/calc.htm
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FAQs
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What should be included in my retirement letter?
See the website http://aiuea.psealocals.org and click on the Tenure to Retire tab.
Dr. Michael Brinkos
Assistant Executive Director of
Operations and Educational Services
Allegheny Intermediate Unit
475 East Waterfront Dr.
Homestead, PA 15120
Dear Dr. Brinkos:
Please be advised that this notification is my official letter of intent to retire at the end of
the 2013-2014 school year. My last day of work with the Allegheny Intermediate Unit will
be June 22, 2014 (note your date). My retirement will be effective June 23, 2014 (note your
date). This letter of intent to retire is contingent upon receiving the benefits listed under
Section 82 – Retirement Benefits of the current Collective Bargaining Agreement. Thank
you for your cooperation in this matter.
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Respectfully yours,
© AIUEA, DG
How do I guarantee that my
retirement letter has been received?
We recommend using certified mail with a
signature required.
You may choose to use general mail
delivery followed by an email to
michael.brinkos@aiu3.net asking for
confirmation of receipt of the
correspondence.
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© AIUEA, DG
Upon what date shall I make my
retirement effective?
• Date your retirement as the day after your
last day of school.
• If not sure of your last day of school, state
in your letter ‘…….effective the day after
the last day of school’.
• Your retirement date determines the
calculation of your PSERS payment.
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May I rescind a letter of
retirement?
– No
– Extenuating circumstances will be
addressed on an individual basis.
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What if I teach until August as in
the DART Program?
Retirement still occurs during the
current school year.
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What if I am working in ESY?
- Still notify the IU that you intend to retire.
- Notify PSERS that you have extenuating
circumstances.
- It is possible to retire from AIU and
PSERS on different dates.
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What if I miss teaching?
Act 63:
– You can substitute
– You can coach
– Note that if you are receiving Social Security
benefits, you are allowed to earn: Ages 62-66,
$15,480; the year you turn 66 up to your 66th
birthday, $43,410. If you earn more, you will
lose a portion of your Social Security benefit.
After age 66, you may earn any amount and
not lose benefits.
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Is my spouse covered by my
health benefits?
- Benefits are tied to the employee.
- If your spouse is older…….
S/he is covered as long as you are.
- If your spouse is younger……..
S/he is eligible for COBRA or a HOP
Program.
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Is my dependent child covered by
my health benefits?
- Benefits will continue for all children until the 1st
day of the month after the child turns 26 years of
age as long as the employee is covered.
- This is certified every 6 months by AMCA
Systems. You will receive a correspondence from
AMCA Systems.
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May I continue my Association
Membership?
PSEA/NEA – Retired
- Membership continues your Member Benefits
- Advocates for retirees
- The Lifetime membership fee is $692.00.
Several payment options are available.
-The Yearly membership fee is $64 for 2014.
Pennsylvania Association of School Retirees
(PASR) is not affiliated with PSEA/NEA.
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Contact Information
PSERS
900 Sarah Street Suite 208 Southside
412.488.2031
www.psers.state.pa.us
Janet Breiding – AIU Human Resources
janet.breiding@aiu3.net
412.394.5848
Ralph Butera – AIUEA Retirement Consultant
rbciao@verizon.net
412.720.3858
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