Prince William County Public Schools Office of Benefits &
Retirement Services PREPARING FOR RETIREMENT
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Introduction PWCS Deborah Sparks, Director of Benefits &
Retirement Services Susan Golladay, Benefits Specialist Virginia
Retirement System (VRS) Audrey Macklin, Member Outreach Counselor
Lincoln Financial Steve Singer, Certified Financial Planner
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Outcomes Required Planning Steps Toward Retirement Knowledge
of: Virginia Retirement System Supplemental Retirement Retirement
Opportunity Program Retiree Health
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What Does It Mean to Be a Member of VRS? Retirement Plans
Retirement Plans Retirement Eligibility Retirement Eligibility
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VRS Plan 1: your membership date is before July 1, 2010 and you
were vested as of January 1, 2013 VRS Plan 2: your membership date
is before July 1, 2010 and you werent vested as of January 1, 2013
or your membership date is on or after July 1, 2010 but before
January 1, 2014 Hybrid Retirement Plan: your membership date is on
or after January 1, 2014 or you opted into the hybrid plan during
the opt in period
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Defined Benefit Plan Defined Contribution Plan provides a
monthly benefit funded by you and your employer primarily funded by
you balance based on contributions, investment results and
associated fees
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Age Service Credit AFC Plan 1 36 Plan 2 & Hybrid 60
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Reduced 55 with at least five years of service 50 with at least
10 years of service Unreduced VRS Plan 1 Members 65 with at least
five years of service 50 with at least 30 years of service
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Reduced Unreduced 60 with at least five years of service Age +
Service Credit = 90 Social Security Normal Retirement Age with five
years of service VRS Plan 2 & Hybrid Members
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Meet vesting requirement Increase benefit amount Meet
eligibility for an unreduced retirement benefit Purchase of Prior
Service
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What Are My Retirement Options? Basic Benefit Basic Benefit
Survivor Option Survivor Option Advance Pension Option Advance
Pension Option Partial Lump-sum Option Partial Lump-sum Option
Payment Payment Distribution Options Distribution Options
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Highest maximum consistent benefit
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Monthly benefit for the retiree Monthly benefit for the
survivor upon retirees death
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Receive an additional lump sum payment up to three times your
yearly benefit Coordinates with Basic Benefit or Survivor
Option
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Working beyond unreduced retirement 1 year 1 x Basic Benefit 2
x Basic Benefit 3 x Basic Benefit 2 years 3 years
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Balanced income during retirement when coordinated with Social
Security
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Social Security estimate requirements: Based on age for reduced
VRS benefit Assumes no future income Dated within 12 months
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Not available under 50/10 Stand alone option
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Defined Contribution Distribution Options: Total or partial
lump-sum Annuity payments Periodic payments Partial lump-sum with
remainder as periodic payment or annuity Rollover to other
qualified plan HYBRID RETIREMENT PLAN
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Age Service Credit AFC $56,000 24 years 57 years
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Advance Pension Option Basic Benefit Monthly benefit: $
1,241.41 Benefit before age 62: $ 1,977.61 Benefit after age 62:
$777.61 Social Security at age 62: $ 1,200.00
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Partial Lump-sum Option Payment Basic Benefit without the PLOP
Monthly benefit: $ 2,459.33 Monthly benefit: $2,256.50 One year
PLOP: $29,511.96
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Run an estimate 12-18 months before retirement Use myVRS to
compare options myVRS myVRS
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Complete any purchase of prior service Run a retirement
estimate in myVRS Consult a financial advisor Action Plan
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What Else Do I Need to Health Insurance Health Insurance Life
Insurance Life Insurance Health Insurance Credit Health Insurance
Credit
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Health Insurance Check with your employer concerning cost and
eligibility
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Must pay a monthly health insurance premium Health Insurance
Credit Must have 15 years of service Your employer must participate
in this program
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Begins to reduce at retirement Basic Life Insurance Continues
at no cost
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Continue coverage at active member group rates Optional Life
Insurance
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Research health insurance costs Evaluate your life insurance
needs Action Plan
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What Happens if Things Disability/VSDP/VLDP
Disability/VSDP/VLDP Death in Service Death in Service Return to
Work Return to Work
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Disability Retirement Basic Benefit or Survivor Option
only
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VLDP, VSDP Or Employer Comparable Plan Short-term disability
Long-term disability
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Death in Service Non-Work Related (non-vested): Refund Work
Related: Monthly benefit and refund Non-Work Related (vested):
Monthly benefit or refund
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Order of Precedence Spouse Children Parents Executor Next of
Kin
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Return to Work Full-time VRS-covered position benefit stops
Part-time position with the same employer break in service required
Part-time position with a different employer no break in service
required
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Make sure your beneficiary designation is up to date Consider
ramifications of working after retirement Action Plan
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Take charge of your retirement You can do it! Steven M. Singer
CERTIFIED FINANCIAL PLANNER November 10, 2014
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Take charge of your retirement
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Agenda
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Step 1: Calculate your retirement living expenses
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Step 2: Whats the 4% rule?
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Step 3: Identify other sources of income
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Step 4: Identify opportunities to reduce expenses
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Step 5: Reevaluate your current investment strategy
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Step 6: Understand your distribution options and establish a
withdrawal strategy
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Reevaluate your current investment strategy
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Understand your distribution options
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Establish a withdrawal strategy
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Understanding Social Security and Medicare
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Understanding Social Security
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Understanding Medicare
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Step 7: Start your retirement-planning checklist
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In summary
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Challenge Yourself
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Whats next?
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In summary
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Lincoln Financial can help
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Important disclosures Mutual funds and variable annuities are
sold by prospectus. Investors are advised to carefully consider the
investment objectives, risks, and charges and expenses of a mutual
fund, and in the case of a variable annuity, the variable contract
and its underlying investment options. To obtain a mutual fund or
variable annuity prospectus that contains this and other
information call: 800-4LINCOLN. Read the prospectus carefully
before investing or sending money.
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Important disclosures Variable annuities are long-term
investment products designed particularly for retirement purposes
and are subject to market fluctuation, investment risk and possible
loss of principal. Variable annuities contain both investment and
insurance components, and have fees and charges, including
mortality and expense, administrative and advisory fees. Optional
features are available for an additional charge. The annuitys value
fluctuates with the market value of the underlying investment
options, and all assets accumulate tax-deferred. Withdrawals of
earnings are taxable as ordinary income and, if taken prior to age
59, may be subject to a 10% federal tax penalty. Withdrawals will
reduce the death benefit and cash surrender value. There is no
additional tax-deferral benefit for an annuity contract purchased
in an IRA or other tax-qualified plan. Variable annuities sold in
New York are issued by Lincoln Life & Annuity Company of New
York, Syracuse, NY, and distributed by Lincoln Financial
Distributors, Inc., a broker/dealer. For all other states, variable
annuities are issued by The Lincoln National Life Insurance
Company, Fort Wayne, IN, and distributed by Lincoln Financial
Distributors, Inc., a broker/dealer. The Lincoln National Life
Insurance Company does not solicit business in the state of New
York, nor is it authorized to do so. Contractual obligations are
backed by the claims-paying ability of the appropriate issuing
company. The mutual fund-based programs include certain services
provided by Lincoln Financial Advisors Corp. (LFA), a broker/
dealer (member FINRA) and an affiliate of Lincoln Financial Group,
1300 S. Clinton St., Fort Wayne, IN 46802. Unaffiliated
broker/dealers also may provide services to customers. Lincoln
Financial Group affiliates, their distributors, and their
respective employees, representatives, and/or insurance agents do
not provide tax, accounting, or legal advice. Any tax statements
contained herein were not intended or written to be used, and
cannot be used for the purpose of avoiding U.S. federal, state, or
local tax penalties. 2012 Lincoln National Corporation
LincolnFinancial.com Login: Employer Retirement Plans Lincoln
Financial Group is the marketing name for Lincoln National
Corporation and its affiliates. Affiliates are separately
responsible for their own financial and contractual obligations.
8/12 Z01 Order code: DC-DOIT-PPT001
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Items to Consider: Have you Written a Will? Have you Updated
your Beneficiaries? Have a Set Your Retirement Date? Have a
Positive Attitude about Retirement!
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Current Resources for Retirement Calculate What you Expect to
Receive each Month. Social Security; Retirement; 403(b) Annuity;
Retirement Opportunity Plan (ROP). Take 10% Away as a Cushion. Take
90% and Make it Your Monthly Budget. See if you Can Live Within
this Budget for 12 Months.
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Retirement Opportunity Program (ROP Employee is Full-time at
Time of Retirement Employee Must Have 17 Years of Full-time VRS
Service or Service with a Accredited Education Institution 10 Years
of Service with PWCS, with the Last 7 Being Consecutive Employee
Must be in Good Standing Prior to Retirement Age 55 or older
Employee not Eligible for Disability Retirement
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ROP Contd Retirement other than July 1 will result in the loss
of one year of ROP (i.e., retirement on September 1 would make ROP
effective the following July 1) Employee is Encouraged to Provide 6
Months Notice Work Assignments are Compatible to Position Prior to
Retirement Number of Days Work are Equivalent to 20 days or 10% of
your contract
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ROP Contd ROP Participants are Required to Work the Same Number
of Hours as Required for the Position to Which most Recently
Assigned Example: 223 Employee = 22 days x 7.5 hours = 165 hours
Paid 19% of Their Contract Prior to Retirement paid out over 24 Pay
Periods Maximum Amount of ROP Time is Seven Years or Until
Participant Reaches Social Security Age, Whichever Comes First
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ROP Contd Cease to Be Eligible Fails to Perform Work Assignment
No Longer Physically or Mentally Capable Reaches Age to Receive
Full Social Security Benefits Completes Seven Years of Service
Supervising Director/Principal/Supervisor Recommends Participant be
Deemed Ineligible due to Poor Performance Participant Engages in
Conduct in Violation of School Board Policies
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Retiree Health Insurance Same Health Plans as Offered to
Current Employees Employee Must be ROP Eligible to Use Sick Leave
To Offset Cost of Retiree Medical Employee is Between the Ages of
50 and 65 Retiree Health Continues Until Retiree Becomes Medicare
Eligible or Cancels Health Coverage
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Retiree Health Insurance Contd Employee Must be Enrolled in
PWCS Group Health Plan for a Minimum of Two (2)Years prior to
retirement Employee Must Be Employed With PWCS For a Minimum of Ten
(10) Years View Regulation 545-1 for changes
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Retiree Health Insurance Sick Leave Exchanged To Defray Health
Cost Sick Leave Days ExchangedEmployer Contribution* 125 Days25
Percent 175 Days50 Percent 225 Days75 Percent 275 Days100 Percent *
Percent of Employer Contribution for Active Employees
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Sick Leave & Annual Leave Sick Leave is Paid out at
Retirement at 10% of Employees Daily Per Diem Sick Leave Paid out
is Taxable Sick Leave Exchanged for Retiree Health Premiums is
Taxable at the 10% of the Employees Daily Per Diem Annual Leave is
Paid out at 100% of Value Annual Leave Payout is Taxable at
100%
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SICK LEAVE & ANNUAL LEAVE PAYOUT Payout Options (Regulation
545-1) Lump Sum Payment Supplemental Retirement Rollover Direct
leave payout into the PWCS Supplemental Retirement Plan (Lincoln
Financial) Combination Lump Sum and Rollover Direct portion as lump
sum payout and roll a portion into your PWCS Supplement Retirement
Plan
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Retirement Other Financial Vehicles You have Available: Savings
Accounts Individual Retirement Accounts (IRAs) Other Employer
403(b) or 401(k) Plans Investments Stocks and Bonds Mutual
Funds
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Enjoy Our Hope is That You have Found This Information Helpful
and Useful as You Maneuver your Way to Retirement. Enjoy!
