The Fundamentals of Planning Your Retirement Florida State

“The Fundamentals of Planning Your Retirement” Florida State College at Jacksonville Presented By: Robert Ard TSA Consulting Group, Inc.

Topics FRS DROP Personal Savings Special Pay Plan Retiring- The Process Retirement Plan Distributions TSA Consulting Groups Role

Retirement Options Florida All Retirement System Full-time employees Pension Plan Investment CCORP Plan

Florida Retirement System Pension Defined Benefit Plan Years of Service Age Average Final Compensation Investment Defined Plan Contributions amount Investment Results

FRS Pension How much income can I expect? AFC x YOS x Factor Example: $50, 000 x 30 x 1. 6% = $24, 000 COLA = Years of service at 7/1/2011 divided by years of service at Retirement x 3% What 28 / 30 =. 93 x 3% = 2. 8% are my Benefit Payout Options Life only Life with 10 year certain Joint with 100% to the Survivor Joint with 2/3 to Survivor Note all Options now require a Beneficiary designation

FRS Investment Plan Defined Benefits Contribution Plan based on Employer contributions Investment Your Returns investment skills Portability If you move from an FRS employer to a different employer, this money moves with you.

CCORP Plan ¬ Defined Contribution Plan (eligible employees only) – Based on Employer contributions to employer sponsored 403(b) plan • Investment Returns • – Portability • Contributions and earnings available for transfer upon termination of employment or retirement

What is DROP? FRS Pension benefit that was designed to allow an employee to work past normal retirement age and increase their personal wealth through accumulations in their DROP account.

DROP Only available to FRS Pension Plan Participants After Normal Retirement Age Employee retires from Pension Plan Payments made to a trust earning 1. 3% (Higher if entered DROP before 7/1/2011) Money available at full retirement Portability You may take distribution in cash, utilize a rollover, or combination of two.

DROP When can you DROP? Normal Age Retirement Age 57 if later What happens if I don’t DROP? Normal Pension Lose DROP options after one year if you have reached age limit

DROP How long can I DROP? Up to 5 years What if I want to keep working after five years Must come back as a new employee after being retired for at least one year

What happens at DROP termination? DROP Accumulations for most participants $100, 000 to $200, 000 DROP Options Take Cash – Pay taxes Rollover – Defer taxes Combination Cash & Rollover

Your Pre-Tax Retirement Savings Types of plans available through Florida State College at Jacksonville: 403(b) Tax Sheltered Accounts 457(b) Deferred Compensation Program 403(b) Special Pay Plan

Personal Savings Options Employer sponsored savings programs Pre-tax Fixed plans interest Annuities Equity Indexed Annuities Variable Mutual Annuities Funds

Personal Savings Options Non-Employer Tax sponsored savings Deductible (if you qualify) IRA Mutual Funds Annuities Stocks, Bonds, etc. Non-Tax Deductible Stocks, Bonds Real Estate Annuities Commodities Etc.

403(b) Retirement Savings Available to Education and Qualified Non. Profit Organization Employees Pre-tax savings and accumulation Savings made through salary reduction Deposits choice Tax made to the authorized vendor of your Deferral Account grows without current taxation

457(b) Retirement Savings Available to Governmental Employees Governed Pre-tax savings and accumulation Savings made through salary reduction Deposits Tax by IRS and Plan Document made to the authorized vendor of your choice Deferral Account grows without current taxation

Rules for using accounts Withdrawals Governed by Internal Revenue Code Only pay taxes when withdrawn Loans up to ½ of account to $50, 000 Retirement Income Take income as you need it after retirement (Subject to Internal Revenue Guidelines).

Contribution Guidelines for 403(b) and 457(b) Basic Limit $17, 500 in 2014 Aged Based Addition $5, 500 additional contribution if you are over 50 years old Service Based Catch-up Up only to $3, 000 additional contributions - Subject 403(b) to Years of Service and Prior Contribution Restrictions

FSCJ Special Pay Plan

Contributions Made to the TIAA-CREF Special Pay Plan Accumulated Sick Leave Accumulated Annual Leave

Tax Savings & Deferrals FICA – SS and Medi. Care Taxes Federal Income Taxes

FICA & Medicare taxes Without the Special Pay Plan you pay up to 7. 65% in Social Security and Medicare payroll taxes With the Special Pay Plan Avoid all Payroll Taxes Example: savings $20, 000 x 7. 65% = $1, 530

Access to Special Pay Plan TIAA-CREF holds the assets to this plan Once the funds are credited the employee must contact TIAA-CREF to receive their funds Money is eligible to rollover into other qualified plans

Retiring From FRS Pension Drop Retiring from FRS and Employer

Retiring From FRS Investment Plan What to do with the money? How long before I receive it?

Retiring From FRS CCORP What to do with the money? How long before I receive it?

Types of Retirement Plan Distributions Transaction Categories Exchange: Moving $ from one provider to a provider w/in Plan Rollover: Moving $ from Plan to account(s) outside Plan Transfer: Purchase of Service Credit w/ State Retirement System Moving a current contract from one employer to another Loan: Personal or Residential Loan Normal Withdrawal: Age 59. 5 or current Separation from Service Hardship Withdrawal: “Safe Harbor” reasons only. Qualified Domestic Relations Order (QDRO) Death/Disability (permanent)

Current Process All Plan transactions must be recorded by TSACG Agent/Rep Participant Provider TSA Transactions are submitted through TSACG TSA Consulting Group, Inc.

Two ways to submit transactions Mailed Originals Faxed Documents TSA Consulting Group, Inc.

E-FAX Facts Originals Each set of documents received for a transaction is scanned and converted to a Adobe. pdf file. Faxed Documents Each Fax is automatically converted to a Adobe. pdf TSA Consulting Group, Inc.

Suggestions on Transactions Always include Employee and Rep e-mail address – this allows us to send confirmations of receipt. Always include a completed, LEGIBLE transaction routing request form available at www. tsacg. com. (Fillable) Double check transactions to ensure they are in good order. Incomplete transactions usually crawl to their destination. Check www. tsacg. com for current version of routing form. TSA Consulting Group, Inc.

Questions & Answers TSA Consulting Group, Inc.