1. Yasuko Shirakawa, PHR, SHRM-CP Office of Human Resources
Retirement planning
Yasuko Shirakawa, PHR, SHRM-CP
Office of Human Resources

2. Questions to ask yourself:
RETIREMENT PLANNING
Questions to ask yourself:
When will you retire?
Where will you live?
Lifestyle choices
Will you travel?
Your health
Do you plan to work part time?
Picture what you want out of retirement and how you plan on getting there

3. Most of us picture our retirement to look like this:
RETIREMENT PLANNING
Most of us picture our retirement to look like this:

4. RETIREMENT PLANNING
Not this:

5. Retirement planning basics Early planning stages
Workshop agenda
Retirement planning basics
Early planning stages
CSU benefits and programs
Program advantages
Important goals
CalPERS Retirement Program
How does it work?
How to calculate your retirement benefit
Other considerations
Questions and Answers

6. Retirement planning basics
Typical retirement income sources for CSU employees:
CalPERS Retirement pension
CSU Voluntary Retirement Savings – (b), 401(k), and 457 plans
IRA and Roth IRA
Social Security benefits
Miscellaneous – assets/property, inheritance, military or other retirement pensions

7. Voluntary retirement savings plans:
Early planning stages
Voluntary retirement savings plans:
401(k) /457 Savings Plus Program - State
403(b) Tax-Sheltered Annuity Program - CSU
IRA or Roth IRA plans
Advantages:
Pre-tax savings reduce taxable income during years of highest earning potential
Convenient payroll deduction
Compound interest
Asset allocation
Inflation protection

8. Other employer benefits:
Early Planning stages
Other employer benefits:
CalPERS Long-term Care (LTC) program
ScholarShare 529 College Savings plan
EAP/MetLaw Pre-paid Legal Plan
Health Care Reimbursement Account (HCRA)/Dependent Care Reimbursement Account (DCRA)

9. Early Planning stages Advantages:
Long-term Care plan- lower premium if enrollment is at a younger age; inflation protection
College savings for future expenditures
Legal benefits, estate and tax planning
Pay for certain costs with pre-tax dollars, reducing taxable income

10. Set a goal and work on it over time!
Early Planning stages
Other important goals:
Pay off debt – mortgage, student loans, credit cards, car payments
Reduce new debt
Plan for future expenditures
Create an emergency fund
Set a goal and work on it over time!

11. CalPERS Retirement Program
Defined benefit retirement plan – retirement income that you cannot outlive
Funded by:
Member contributions
Employer contributions
Investment earnings
Total CalPERS Market Value as of 1/10/17
$ Billion

12. CalPERS Retirement Program
CalPERS Eligibility
Permanent and temporary employees
Full-time appointment for more than 6 months
Part-time appointment for more than 1 year
5 years PERS full-time service to be fully vested
Employee contribution (5% or 6.75% of adjusted gross)
Employer contribution is set annually by CalPERS based on annual actuarial valuations
Currently FY employer contribution is 25.15% of gross pay

13. CalPERS Retirement Program
Benefits based on members' years of service, age, and final compensation
Membership is mandatory for eligible CSU employees
Most CSU members are eligible to retire at minimum age 50 with 5 years of service credit*
*Minimum retirement age 52 if you became a member on or after 1/1/2013
2% at 62 minimum retirement age is 52

14. CalPERS Retirement Program
Retirement Categories (excluding Unit 8):
State Miscellaneous Tier 1 – 2% at 55
CSU members hired prior to 1/15/2011
1 year highest compensation
State Miscellaneous Tier 1 – 2% at 60
CSU members hired on or after 1/15/2011
36 months average compensation
State Miscellaneous Tier 1 – 2% at 62*
CSU members hired on or after 1/1/2013
Consecutive 36 months average compensation subject to cap

15. CalPERS Retirement Program
How retirement benefits are calculated:
Service Credit x Benefit Factor x Final Compensation* =
Unmodified Allowance
($Pension Amount)
*Highest average pay rate during any consecutive 1-year or 3-year period, dependent on retirement formula
Service credit accumulates on a fiscal year basis from July 1 through June 30.

16. CalPERS Retirement Program
Example:
Employee works FT for 27 years = 27 years of service credit
Retirement Category = 2% at 55
Employee retires at age 60; Benefit Factor = 2.314%
Highest final compensation (annual salary) = $50,000
27 x % = %
62.478% x $50,000
= $31,239 annual unmodified allowance

17. Other considerations:
Retirement planning
Other considerations:
$31,239 benefit estimate is present value
Less after inflation
Will this provide the retirement lifestyle you want?
What other sources of income will you have?
Be smart – pay yourself first to ensure a comfortable retirement!

18. Voluntary retirement savings program
CSU Tax-Sheltered Annuity (TSA) 403(b) Program
Employer-sponsored plan for CSU employees
Pre-tax payroll deductions
Fidelity Investments
Fixed plan administrative fee of $46 per year
New investment options
Dedicated campus representative
Fidelity NetBenefits:

20. a

21. View, print and save CalPERS Annual Member Statements back to 2005
Create a retirement estimate
Apply for service retirement
View current CalPERS service credit, health plan, address on file, covered dependents and eligible appointments
Order and download publications
Send a secure message to the CalPERS Member Contact Center

22. Retirement planning
QUESTIONS??