Spring Retirement Meeting APRIL, 2015

AHHHH ~ Retirement

Normal Retirement – Pension Plan For employee’s hired prior to July 1, 2011, Normal Retirement is:  Vested (at least 6 years of creditable service in the FRS)  Age 62 OR 30 years of creditable service, whichever comes first

Normal Retirement – Pension Plan For employee’s hired after July 1, 2011, Normal Retirement is:  Vested (at least 8 years of creditable service in the FRS)  Age 65 OR 33 years of creditable service, whichever comes first

Planning Ahead: I plan on retiring …how do I prepare?

What do I need to do?  Schedule an appointment with the Retirement Coordinator  Complete Application for Service Retirement  Sign forms in front of a notary  Submit forms to the Division of Retirement

When should I begin?  FRS prefers to receive Application for Service Retirement 3 months prior to termination date. This allows the division time to:  Complete all the necessary calculations  Add your name to the retired payroll  FRS will not accept applications more than 6 months in advance of your effective retirement date.

What will I need?  When you apply for retirement, you must furnish proof of your age.  The division must receive the required proof of age before you can begin receiving benefits.  If you choose benefit Option 3 or 4, you must also furnish proof of age for your joint annuitant.

What proof of age will be accepted? The division will accept a readable copy of one of the following documents:  Birth certificate  Delayed birth certificate  Census report more than 30 years old  Life insurance policy more than 30 years old  Documentation from Social Security Administration stating the date of birth has been established for payment of benefits to you or your joint annuitant  Certificate of naturalization

Pension Benefit Options What are the four Pension benefit options?

 The maximum monthly benefit payable to you for your lifetime.  Upon your death, the monthly benefit will stop and your beneficiary will receive only a refund of any contributions you paid which are in excess of the amount you received in benefits.  This option does not provide a continuing benefit to your beneficiary.  If you are married and select Option 1, your spouse must acknowledge your selection.

 Monthly benefit that is less than the Option 1 benefit, and the benefit is payable to you for your lifetime.  In the event you die within ten years after your retirement date, including any period of DROP participation, the same monthly benefit will be paid to your designed beneficiary for the balance of the 10-year period. No further benefits are then payable.  If you are married and select Option 2, your spouse must acknowledge your selection.

 A reduced monthly benefit payable for your lifetime.  Upon your death, your joint annuitant, if living, will receive a lifetime monthly benefit payment in the same amount as you were receiving.  No further benefits are payable after both you and your joint annuitant are deceased.

 An adjusted monthly benefit payable to you while both you and your joint annuitant are living.  Upon the death of either you or your joint annuitant, the monthly benefit payable to the survivor is reduced to two-thirds of the monthly benefit received when both are living.  No further benefits are payable after both you and your joint annuitant are deceased.

DROP Deferred Retirement Option Program

What is the Deferred Retirement Option Program (DROP)?  The DROP is a Pension Plan program under which you may retire and have your monthly retirement benefits remain in the Florida Retirement System (FRS) Trust Fund instead of being paid directly to you or deposited in your bank.  Your benefits will earn interest for you, tax deferred, for as long as you participate in the DROP.  In the meantime you continue to work for your FRS employer for a specified and limited period up to the date you pre-selected to stop participation in DROP.

What is the Deferred Retirement Option Program (DROP)?  When the DROP period ends, you must terminate employment.  At that time, you will receive payment of the accumulated DROP benefits, and begin receiving your FRS monthly retirement benefit (in the same amount as determined at retirement, plus annual cost-of- living increases).

When can I begin DROP?  You can begin the DROP when you are vested and have reached your normal retirement date (if you have FRS service prior to July 1, 2011), as follows:  Your normal retirement date is either when you are vested (6 years) and reach age 62, or when you complete 30 years of service, whichever comes first.  If you become vested after age 62, your normal retirement date is the month following the month you reach 6 years of service.

DROP Eligibility You must elect DROP participation within 12 months after you first reach your normal retirement date unless you are eligible to defer as follows:  If you have FRS service prior to July 1, 2011 you may…  …defer DROP enrollment if you complete 30 years of service before age 57, you may defer DROP and elect to begin participation at any time between completing 30 years and reaching age 57.

Can I defer starting DROP? You are eligible to defer DROP enrollment if you are:  Members in Instructional positions defined by s (2)(a)-(d), F.S., may begin DROP at any time after reaching normal retirement.

What if I want to switch plans? 2 nd Election

One-Time Opportunity to Switch FRS Retirement Plans  After making your initial Florida Retirement System (FRS) retirement plan selection, you can change plans one time during your FRS working career. This plan change – called your “2 nd Election” – IS NOT FOR EVERYONE, but it could be right for you.  If you are considering changing from the Pension Plan to the Investment Plan, you should review the Fund Profiles, the Investment Fund Summary, and the Annual Fee Disclosure Statement posted in the “Investment Funds” section at MyFRS.com before selecting any investment funds or making an election.

One-Time Opportunity to Switch FRS Retirement Plans  Before using your 2nd Election, get unbiased help from the FRS. Review your plan options carefully. Once you make a 2nd Election, that decision is final unless you timely notify the MyFRS Financial Guidance Line that you wish to cancel your election. Once your 2nd Election is finalized, you must remain in your chosen plan until your FRS-covered employment ends and you retire. The FRS offers two ways to get free help:  Call the toll-free MyFRS Financial Guidance Line at , Option 1 (or TRS 711). Financial planners will provide personalized, unbiased information based on your individual situation. Get solid financial guidance from someone who is not trying to sell you investment or insurance products.  Log in at MyFRS.com and select the 2nd Election Choice Service to see your projected Retirement benefits under both plans. You can change the information to better match your life circumstances.

If you are in the FRS Pension Plan – you can switch to the FRS Investment Plan What this means to you:  No cost to you!  The present value of your Pension Plan benefit (called an accumulated benefit obligation, or ABO) will become your opening Investment Plan account balance.  You will be fully vested in the money you transfer from the Pension Plan to the Investment Plan after you have 6 years of service credit under the FRS.  You will be vested in new contributions if you have at least 1 year of FRS-covered employment.  If, however, you terminate employment with less than 6 years of service credit, you could forfeit the amount transferred from the Pension Plan!

If you are in the FRS Investment Plan – you can switch to the FRS Pension Plan What this means to you:  Your Investment Plan service will count toward the Pension Plan’s 6-year vesting requirement  You must “buy in” to the Pension Plan using the money in your Investment Plan account.  The FRS will calculate your buy-in cost…

If you are in the FRS Investment Plan – you can switch to the FRS Pension Plan If you buy in to the pension plan…  And have extra funds left in your Investment Plan account, this surplus will remain in your Investment Plan account and you will continue to manage the funds as you did before.  However, your Investment Plan money will not be available for distribution until you retire and begin receiving your Pension Plan benefit. After your buy-in cost is calculated…  If there isn’t enough money in your Investment Plan account to cover the buy-in cost, you must make up the difference using your personal funds.  You may be permitted to roll over funds from another eligible retirement plan to help pay the difference.  Note: The buy-in cost increases monthly.

CAUTION  Some outside investment agents may try to persuade you to use your 2 nd Election. Make an informed decision by calling the MyFRS Financial Guidance Line and speaking with an unbiased financial planner to see whether making a 2 nd Election is in your best interests.

Reemployment

Reemployment after retirement or at the conclusion of DROP participation? After you retire under the FRS, you can work for:  Any private employer  For any public employer not participating in the FRS  For any employer in another state, without affecting your FRS benefits

Reemployment limitations with FRS- participating employers There are, however, certain termination requirements and reemployment limitations that affect your retirement benefit if you are employed with FRS-participating employers during the first 12 calendar months after your effective retirement date without Deferred Retirement Option Program (DROP) participation or after your DROP termination date.

The termination requirements and reemployment limitations with FRS- participating employers are:  If you return to work during the first six calendar months of your retirement or after your DROP termination date, you are not retired. Your retirement application is voided and all retirement benefits, including any funds accumulated during your DROP participation, must be repaid, by you, to the FRS Trust Fund. This restriction applies even if the particular position you hold is not covered by the FRS (such as a substitute).

The termination requirements and reemployment limitations with FRS- participating employers are:  You may not receive both a salary and a retirement benefit in the same month during the seventh through twelfth calendar months of your retirement or after your DROP termination date. There are no exceptions to this reemployment limitation during this period. This restriction applies even if the particular position you hold is not covered by the FRS. You must inform us if you work for an FRS employer during the reemployment limitation period.

The termination requirements and reemployment limitations with FRS- participating employers are:  There are no limits on working for an FRS employer after you have been retired for 12 calendar months.  If you are reemployed with a participating employer, you will be required to sign a statement that your reemployment does not violate these provisions.

Note: Employment with an FRS employer includes any full-time, part-time, temporary, other personal services (OPS), contractual services or non- contractual services with your previous employer or any other FRS employer.

But can I volunteer?  According to the Department of Labor, an individual who performs hours of service for a public agency for civic, charitable, or humanitarian reasons, without promise, expectation or receipt of compensation for services rendered, is considered to be a volunteer A few examples of non-paid services recognized as volunteer services  ​ Booster Club activities  Coaching athletics  Courtesy Faculty positions with universities  Guardian Ad Litem (for children and adults seniors)  Library/Media/ Cafeteria assistance  School guard  School campus clean-up  Trip chaperone  Tutor, mentor and literacy programs in K-12 schools

Questions to assist in determining whether a retiree is a true volunteer. Expected answer: YESExpected answer: NO Is the activity less than a full-time occupation? Is the work otherwise performed by other employees? Are the services of the kind typically associated with volunteer work? Have regular employees been displaced or have vacant positions remained open to accommodate the volunteer? Does the worker receive (or expect) any benefit from the entity to which it is providing services?

Retirement….. Where EVERY day is a Saturday!

Contact Information: Sheila Bennett, Retirement Coordinator (352)

Retirement and Payroll. It's nice to get out of the rat race, but you have to learn to get along with less cheese. Chris Carmickle Payroll Manager Lake County Schools

Who pays you?  Your pension is paid by the Florida Retirement System.  Lake County Schools Payroll has no direct involvement with the calculation of your monthly pension check, or your investment funds distribution.

Terminal / Sick Leave information as of 10/01/2012  Terminal Pay refers to the payment of Sick Leave  Has value only if you retire as your reason for separation from service.  “Normal Retirement” – retirement with either full or reduced benefits as provided by the Florida Statutes, but shall not mean disability retirement.  6 or 8 years of retirement creditable service required  When you enter DROP you retire  Your leave value is calculated at entry to DROP  Your leave value will not increase  Any employee entitled to accrued sick pay benefits shall have been under appointment to render services for the period immediately preceding termination, and shall not be under suspension from duty or have any charges pending which could result in dismissal from employment.

Terminal / Sick Leave information as of 10/01/2012 The value of terminal leave is determined by 1. Position  Administrative/Managerial employees are credited at the rate Sick Leave was earned back to 2004  Other employees are paid at the current rate of pay. 2. Length of service in a qualified position with Lake County Schools - not in an FRS position  35% 0 – 3 years  40% 3 – 6 years  45% 6 – 9 years  50% 10 – 12 years  100% > 12 years

Terminal / Sick Leave information as of 10/01/2012 DROP  Your rate of pay and hours are frozen the last regular work day before you enter DROP (not summer work)  Any sick leave you earn after that date will not be paid at separation.  You will have options for your payment of sick leave while you are in DROP. Read your options and ask questions before you make a selection. Your selection affects  Eligibility for Sick Bank  Ability to use sick leave days

Annual / Vacation Leave information as of 10/01/2012  Annual Leave refers to Vacation Leave  Any employee who voluntarily separates from employment or transfers from a twelve (12) month position to less than a twelve (12) month position in the District shall receive pay for accrued vacation leave at the time of transfer or voluntary separation provided he / she has been employed for twelve (12) continuous months.  Payment shall be made at the rate of pay at the time of voluntary separation from employment, retirement, transfer or death.  The maximum number of vacation days paid during any one employment period shall be forty-eight (48).  The employee will receive a lump-sum payment of accrued vacation leave or may request to extend his/her employment status through the last day of accrued vacation leave.

Annual / Vacation Leave information as of 10/01/2012 DROP  An employee’s vacation leave balance may be paid at entry to DROP and again at the exit from DROP.  The total days paid may not exceed forty-eight (48).  Payment shall be made at the rate of pay at the time of voluntary separation from employment, retirement, transfer or death. Therefore Vacation paid at entry to DROP and at exit from DROP may be at different rates of pay.  Vacation paid at entry to DROP is credited toward your AFR calculation.

How are Leave Payments distributed?  The lump sum payment of accrued sick (or vacation leave when applicable) will be disbursed to the District’s 401(a) salary deferral plan (The BENCOR Special Pay Plan) Mandatory, not optional

The what? The BENCOR Special Pay Plan  The BENCOR 401(a) Special Pay Plan (SPP) is a tax-qualified retirement plan for unused sick pay and vacation pay.  The BENCOR SPP is a powerful retirement tool offered by your employer. If you are entitled to sick and vacation pay the BENCOR SPP will help ensure you never pay Social Security and Medicare taxes on that money. It will also give you the ability to defer payment of the related income taxes until you receive distributions at retirement.  Note: Income taxes are payable upon withdrawal. Federal restrictions and a 10% tax penalty may apply to a withdrawal after termination of employment if you are not at least age 55 by year end.

BENCOR: Don Anders, Representative

Social Security Administration Rebecca Price

Becky Frost, Benefits Manager Brown & Brown Insurance

Valery Insurance Agency Doug Valery