Step Into Retirement Benefits FAQS: Part Two
Welcome back to the second installment of our Retirement Benefits FAQ Section! In this continuation from last month, we'll further explore your questions about retirement planning, pension benefits, and post-retirement considerations. Whether you're seeking clarity on medical insurance, employment opportunities post-retirement, or additional insights into maximizing your retirement benefits, we've got you covered. Let's pick up where we left off and continue empowering you on your journey towards a secure and fulfilling retirement.
Q: What happens to the money taken out of my paycheck?
A: Employee contributions are collected and accumulated in an accrual account held at SLOCPT. These contributions accrue interest at a rate determined by the Board of Trustees. Members can access their accrual account balance by contacting SLOCPT or creating an online account in SLOCPT’s Member portal. Additionally, they will receive an annual statement via email each January detailing their balance as of year-end. It’s important to note, that these balances do not determine retirement benefits. If a Member leaves employment before retiring, they have the option to either take a refund of their accumulated balance or, if eligible, leave their funds with SLOCPT to receive a lifetime monthly benefit upon eligibility.
Q: What happens if I become disabled and can no longer work?
A: The Plan offers Disability Retirement options for Members who become permanently disabled and are unable to perform their job duties. There are two (2) types of Disability Retirement benefits available. Ordinary Disability Retirement is open to any eligible Member who becomes permanently incapacitated to the extent they can no longer work, provided they have accrued at least five (5.0) PTSCs. Industrial Disability Retirement is specifically for Safety and Probation Members. Requiring the disability to be predominately service-connected, with no minimum PTSC requirement. Approval for Disability Retirement requires sufficient medical evidence of permanent disability. The burden of proof lies with the Member, and an application for Disability Retirement must be submitted to SLOCPT before employment termination.
Q: Is there cost of living adjustments (COLAs) in retirement?
A: Yes. Annual retiree COLAs are based on a two (2) year average change of the San Francisco and Los Angeles Consumer Price Indexes (CPI). For Tier 1, there is a 3.00% max COLA with carryover if the calculated rate is over 3.00% for Tiers 2 and 3, there is a 2.00% max COLA with no carryover.
Q: Will my pension benefit be taxable in retirement?
A: Yes, pensions are subject to Federal and State income taxes, as they are funded by pre-tax Employee and Employer contributions, as well as pooled investment returns.
Q: Does my pension provide any death benefits?
A: Yes. For an Active Member who hasn’t reached retirement eligibility, the Basic Death Benefit includes the Member's Accrual Account balance at the time of death, plus one and a half times the Member’s monthly base pay multiplied by the total number of full PTSCs accrued (up to a maximum of 12 PTSCs). If an Active Member is eligible for retirement and has an eligible Survivor at the time of death, the Survivor may opt for the Basic Death Benefit or choose to receive the Option 2 monthly Survivor Benefit to be paid throughout their lifetime. The Option 2 benefit is calculated based on the benefit amount as if the Active Member retired on the date of their death. An eligible Survivor includes a spouse or registered domestic partner married or registered for at least one (1) year before their death, or, in specific circumstances, an eligible minor child. For retirees, the death benefit depends on the option chosen at retirement plus a $1,000 lump sum.
Q: Will I still receive Social Security benefits if I am a Member of the Plan?
A: Yes, if a Member meets the eligibility requirements for Social Security benefits.
Q: Do I get medical insurance as a retiree?
A: Eligibility for medical insurance after retirement depends on the policies of the participating Employer for whom the Member worked and what they offer. To determine eligibility for medical, dental, or vision insurance during retirement, contact your Employer or SLOCPT for assistance.
Q: After I retire, may I continue to be employed by the County or another of the participating Employers?
A: If a Member is retired and receiving a retirement benefit from SLOCPT, they may work for any participating Employers temporarily, not exceeding 960 hours in a fiscal year (July 1st to June 30th). However, retired Miscellaneous Members must wait 180 days after their retirement date before returning to work in a temporary capacity. This waiting period doesn’t apply to retired Safety or Probation Members. In addition, retirees can serve as jurors or election officers and receive compensation payable for such service without affecting their retirement benefits.
Q: Can I access my SLCOPT Member Account online?
A: Yes, and SLOCPT highly encourages you to take advantage of the convenience of our Member Direct portal. Please contact SLOCPT at (805) 781-5465 to request your PIN. You can then visit the portal at Members.SLOCPT.org to use your unique PIN to enroll.
As we conclude this two-part series on Retirement Benefits FAQs, we hope the information provided has been valuable in guiding you through the complexities of retirement planning. Remember, your financial future is a journey worth investing in, and knowledge is your greatest asset. Should you have any further questions or require additional assistance, don't hesitate to reach out. Here's to a prosperous and fulfilling retirement ahead – Cheers!
For questions regarding your pension, please call us at 805-781-5465 or email us at slocpt@co.slo.ca.us. Many of your questions may be answered by logging in to MemberDirect!
