TRS retirement report: a bi-annual newsletter for retired members [Jan. 2011]

TRS retirement report

www.trsga.com

A bi-annual Newsletter for Active members Winter 2011

Pre-Retirement RChecklist
24months to retirement
q Familiarize yourselfwithTRS benefits:
n Visit www.trsga.com.
n Read the Member's Guide.
n Pay close attention to the 7 TRS retirement plan options, beneficiary issues, and service credit purchases.
q Review your online TRS Membership Statement and the information contained in your online TRS account for accuracy and consider whether any service is available for purchase. If you find an error, contact TRS.
q Obtain a TRS retirement benefit estimate: 1) go to the "Generate Benefit Estimate" tab in your online TRS account (pulls real data from your account); or 2) call TRS to request one.
q Request an estimate of your retirement benefits from the Social Security Administration.
q Evaluate your other investments. When will these funds be available? What are the withdrawal options: lump-sum or recurring payments?
q Review your current living expenses and project what these will be at retirement. Will your income from all sources cover your projected expenses?
n This is the time to begin preparing a retirement budget.
continued P2
INSIDE THIS ISSUE:

TRS Welcomes New
Board Chair and Members
from
Jeffrey L. Ezell, Executive Director

We are pleased to announce the May election of Dr. L.C. Evans as Chair of the Board. Dr. Evans has been a member of the TRS Board of Trustees since 2006.
In the past few months, Governor Deal has appointed three new members to the TRS Board of Trustees. Mr. Brad Dunagan is an investment advisor, and Ms. Jennifer W. Frisch and Ms. Rachel L. Willis are both classroom teachers. We are excited to have them as a part of the team.

Dr. L.C. Evans

Many of you may

already

know,

or be familiar

with, Dr. Evans

as he has been a

TRS Board member for over five

years. He has served on various TRS

Board committees and is currently

Superintendent of Schools in Forsyth

County.

Dr. Evans is a graduate of Abraham Baldwin Agricultural College, received Bachelor's and Master's degrees from Valdosta State College, and he

received his doctorate in Educational Administration from the University of Georgia in 1991. Prior to becoming the Superintendent in Forsyth in January, 2008, Dr. Evans served as an assistant superintendent and the first board appointed superintendent of Bleckley County Schools, he worked for the Heart of Georgia RESA as a consultant and program director, served over 12 years in adjunct faculty positions, and worked in management for one of the world's largest Fortune 500 agricultural corporations.
Dr. Evans has served in many associations on both the regional and state levels. These associations include: Middle Georgia School Superintendent's Association; Georgia School Superintendent's Association; and, Georgia Association of Educational Leaders. He was appointed by Governor Nathan Deal to serve on the Education Funding Study Commission.
His hobbies include exercising, forestry management, reading, and spending time in the outdoors.
continued P3

P2
Interest Rate of Calculations and Contributions

P4
Summer Retirement Application Deadlines

P7
Online Retirement Application Process

P2
Pre-Retirement RChecklist
24 months to retirement cont.
n Consider hiring a Certified Financial Planner or other licensed financial advisor for individual advice on meeting your retirement goals.
n In general, financial experts state that people need between 65% and 85% of their current income to maintain their standard of living in retirement. This includes your TRS benefit, Social Security benefit, personal savings and investment income, and any income you may earn from working in retirement. Depending on your retirement goals, the income replacement you need can vary.
q Anticipate new or recurring expenses (i.e., car, medical, home repairs) and consider paying off some of these debts before you retire.
q Consider your tax situation. How much will you be required to pay in income taxes? Are there any special tax breaks on retirement income where you will live?
q Time your retirement to fit your goals. Consider these items:
n The time from your last paycheck to your first TRS benefit retirement payment.
n If you participate in a flexible benefits programs such as dental or life insurance, consider how your date of retirement will affect these benefits.
continued P4

Important Memo Interest Rate of Calculation and Contributions
The TRS Board of Trustees adopted an amendment to Administrative Rule 513-5-1-.52 on November 16, 2011. In accordance with the amended policy, the interest rate used to calculate service purchases will be the TRS long-term discount rate of return which is currently 7.50%. This rate will be effective for all service purchases on or after April 1, 2012.
When calculating interest for service purchases, TRS may use multiple interest rates. Interest is compounded and the rate(s) used will depend on the date of the service being purchased and the interest rate in use at that time.
EXAMPLE:
Mary Smith is eligible to establish one year of service for the 1971-72 school year. Effective July 1, 2012, the cost to establish this service will be the amount of contributions she would have contributed during 1971-72, plus accrued interest.

Member Contributions

Interest Rate

Interest Amount

$400.00

3.50% from 7/1/1972 - 6/30/1977 4.50% from 7/1/1977 - 3/30/2012 7.50% from 4/1/2012 - 6/30/2012 Total Interest Total Cost

$ 76.38 1,792.49 142.46
$ 2,011.33
$ 2,411.33

To establish service at the current 4.50% interest rate, payments must be received no later than March 30, 2012. Please contact our office at (404) 352-6500 or (800) 352-0650 to request a service purchase calculation. z

P3

TRS Welcomes New Board Members and Chair continued from page 1

Mr. Brad Dunagan
Mr. Dunagan is an Investment Advisor with the firm, Resource Horizons Group, LLC, Marietta, Georgia, Member of FINRA & SIPC, and is a Certified Estate Advisor with the National Association of Financial and Estate Planning. He received his B.A. in Business from Georgia State University. Upon graduation, Mr. Dunagan joined Union Chemicals of Schaumburg, Illinois, as a credit analyst and later as Regional Credit Manager for the Southwest. In 1991, he joined Georgia-Pacific Corporation as Residual Products Manager/Environmental Engineering Division tasked with heading up clean up and reclamation of old company wood residual landfills around the country. Mr. Dunagan joined Merrill Lynch, Inc., as a Financial Consultant, in 2000, achieving Executive Club status with the Global Private Client Group.
Since 1996, Mr. Dunagan has volunteered with several Humanitarian Aid and Mission Organizations that have provided earthquake and tsunami relief, and humanitarian aid to people in need around the world. He is also former Chairman of the Board for Rehabilitation Industries of Northeast Georgia, a community based organization that provides training and job placement assistance for adults with mental and physical challenges.
Mr. Dunagan is a veteran who served with the U.S. Marine Corps. He is married to Mary Grant, formerly of Roswell, Georgia, and they have three children, three grandchildren, and make their home in Gainesville, Georgia.
Ms. Jennifer W. Frisch
Ms. Frisch is an eighth grade advanced content science teacher at Lovinggood Middle School in Cobb County. She began teaching in Georgia in 1991, after teaching in her home state of

West Virginia and in Clemson, South Carolina. Jennifer was chosen as her school's Teacher of the Year in 2001, and then the Cobb County Teacher of the Year in 2002. Soon after receiving this honor, she left the classroom to work as a lead teacher, but chose to return to teaching four years ago.
Her hobbies are varied, but one she never tires of is international travel and spending time with her extended family in the Virginia mountains. She is delighted to serve on the TRS board so she can represent the many educator friends she has who will depend on TRS in the future.
Ms. Rachel L. Willis
Ms. Willis is a third grade teacher at Morningside Elementary in the Atlanta Public School system. She received her B.A. in Government from Smith College, her Certificate in Elementary Education (P-5) from Agnes Scott College, and her Ed.M. in Education Leadership from the Teachers College, Columbia University. Upon her graduation from Smith College, Ms. Willis joined the field of education in 2004 as a Teach for America corps member.
After teaching 2nd-4th grade, Rachel was named the 2009-2010 Atlanta Public Schools Elementary Teacher of the Year. The following year, Rachel was honored nationally as a Milken Educator Award recipient. The Milken Family Foundation honors early and mid-career teachers for what they have achieved and the promise they possess in impacting education in the future. In addition to serving on the TRS Board of Trustees, Ms. Willis was appointed by Governor Deal to serve on his Education Advisory Board in Feb. 2011.
Please join us in welcoming our new members and chair. TRS is looking forward to another productive year. z

P4

Pre-Retirement RChecklist
24 months to retirement cont.
q Attend a one-day seminar sponsored by TRS with speakers on important topics, including:
n TRS n State Health Benefit Plan n Board of Regents Health Plan n Social Security n Estate Planning
18 months to retirement
q Research medical insurance for you and your family and verify your post-retirement eligibility.
q Depending on where you work, contact either the State Health Benefit Plan or the Board of Regents Health Plan for information on continuing your health coverage in retirement.
q Go to www. medicare.gov for information on Medicare. Medicare typically starts at age 65 for most individuals. Depending on your situation, however, you might not actually enroll in traditional Medicare coverage.
q Consider long-term care insurance coverage for the high costs associated with nursing home care.
q Evaluate your life insurance needs in comparison to your coverage and consider any conversion rights, which would allow you to carry that coverage into retirement.
q Review your estate plan and make sure your will, trust, and/or power of attorney is upto-date. Understand how your assets pass to others under state law.
q If you are purchasing service credit, plan it so your purchase will be paid in full prior to your retirement date. All service purchases must be completed before you retire.
q Attend a pre-retirement workshop sponsored by TRS (if you have not already attended a one-day seminar).
continued P6

Summer 2012
Retirement Application Deadlines
Due to the high volume of new retirements submitted during the spring, receiving applications early will help ensure new retirees receive their first benefit check in the month they retire. Please keep the following dates in mind as we advance towards summer:
June 1st retirees must complete and submit applications and paperwork to TRS by March 31, 2012 if they would like to receive their first benefit check in June.
July 1st retirees must complete and submit applications and paperwork to TRS by April 30, 2012 if they would like to receive their first benefit check in July.
Applications received after these dates will be processed on a first-come, firstserved basis. We do our best to accommodate everyone, but applications/forms received in our office by the deadlines listed ensure a timely retirement benefit payment. The retirement application is not complete until all of the following forms have been received by TRS:
Application for Service Retirement
Identification for members and beneficiaries
State and Federal Tax Withholding Forms
Affidavit of Residency*
Retirement Certification Report (TRS-8) completed by your employer
If members have any service credit for which they are eligible to purchase, it must be purchased PRIOR TO RETIREMENT.
* Federal (8 U.S.C. 1621) and State (O.C.G.A. 50-36-1) statutes require verification of lawful presence in the United States when applying for public retirement benefits. Therefore, TRS must require that every member applying for either service or disability retirement complete a notarized Affidavit of Residency form. The form is located in the Forms drop down menu and has been added to the online Service and Disability Retirement Packages. It is not in the Retirement Handbook, so please ensure your employees complete and include it with the other required forms. z

P5

The 3 R's of Teacher

Pension Plans.......... Recruitment

A new study analyzing the effectiveness of defined benefit (DB) pensions on teacher retention and

Retention Retirement

productivity finds that pensions play a critical role in recruiting and retaining productive teachers.
This increases each school's level

longer, as compared with defined contribution (DC) individual retirement accounts.
In 2003, DB pensions helped

for state and local policymakers striving to improve education, yet continuing to struggle with highly strained budgets." z

of effectiveness, thereby benefiting students. Additionally, DB pensions save school districts money by reducing expensive teacher turnover

to retain an additional 22,000 teachers nationwide. Because longer tenured teachers are more effective teachers, the increased

Boivie, Ilana. "The 3 Rs of Teacher Pension Plans: Recruitment, Retention, & Retirement."
The National Institute on Retirement Security, Oct. 2011. Web. 09 Dec. 2011. <http://www.nirsonline.org>.

costs. More specifically, the new

retention that DB pensions bring

study, Three Rs of Teacher Pension

increases the overall quality of

Plans: Recruitment, Retention, and

public education.

Retirement, finds that: Teacher effectiveness increases

Because the cost of teacher turnover is substantial, the

HAPPY

with experience. Education policy literature finds that teacher productivity increases

retention effects of DB pension plans also save school districts money. In 2003, DB pensions

HOLIDAYS

sharply within the first few years of teaching. Thus, the more retention among mid-career

saved school districts $273.2 million nationally in teacher turnover costs.

Everyone at TRS would

teachers, the more the average teacher productivity within a school will increase.
The cost of teacher turnover is quite high, both in terms of financial cost and loss of productivity to the school district. Additionally, public school teachers turn over less than private school teachers, largely due to their compensation,

Ilana Boivie, report author and economist with the National Institute on Retirement Security, said, "Education policy literature is clear: teachers become more effective as they gain experience. Research also shows that DB pension benefits, which provide a modest, reliable income in retirement, are an essential tool for retaining these highly effective teachers. Moreover,

like to wish you a happy holiday season and a healthy, prosperous New Year!

including pension benefits.

pensions help reduce the high cost

DB pension plans help to recruit high quality teachers, and to retain highly productive teachers

of teacher turnover to school districts and taxpayers. These cost savings are a particularly important consideration

P6
Pre-Retirement RChecklist
12 months to retirement
q Request another estimate from the Social Security Administration.
q Schedule a one-on-one counseling appointment with TRS. During this appointment, you will receive a benefit estimate and the opportunity to ask questions and receive information specific to your retirement. You are more than welcome to bring your spouse, or a guest, with you. You may make an appointment at the TRS Atlanta office or login to your TRS account for a listing of counseling appointments available across the state.
6 months to retirement
q If you have any questions about your TRS benefit, now is the time to get them answered. A TRS representative can be reached by calling (404) 352-6500 or (800) 3520650 (outside metro-Atlanta).
q Now it's time to decide which TRS retirement plan option is best for you. Once you have decided on a retirement plan option and date, you can complete and submit your retirement online at www.trsga.com.
q Request final unused sick leave certification forms from previous TRS employers, if applicable.
q If you plan to work after you retire from TRS, make sure you read and understand the criteria listed in the "Working After Retirement" section of our website. All TRS covered employment must be reported to TRS. Any earnings could affect your TRS pension and/or Social Security benefits.
continued P8

TRS
Live Chat
You've got questions and we've got answers! It is now easier than ever to find the information you need at TRS! In an effort to expand the customer service we provide and answer your questions faster, we have added a Live Chat feature to our website. If you see the box above while you are surfing on our website and have a question, simply click inside the box and you will be connected immediately to a customer service representative. A "chat" window (see below) will open and you will be able to ask questions in realtime without ever having to pick up the phone. In addition to answering questions, TRS representatives are able to provide members with direct links to forms, information, and specific pages on our website that can enhance your experience on our site. This service has been available for a few months and the feedback has been tremendous. Over 99% of members surveyed after using the Live Chat service said it met or exceeded their expectations. Members enjoy the ease of use and how quickly they are directed to the information they need. z
Pictured above is an actual screen shot from a TRS Live-Chat in action.

P7
Online Retirement
Application Process
In an effort to make applying for retirement easier and more efficient, members have the ability to apply for retirement online. Over 1,600 retiring members have successfully completed this process. Doing so is easy! All you have to do is log into your account and click "Apply for Retirement." You will then be prompted to provide information specific to your retirement. When the process is complete, a summary sheet is provided for your records. There are links to other forms not covered in the online process, as well as "Tips" to help make the process as easy and user-friendly as possible. So you are prepared, please note the following items needed to complete the retirement application process.
Items and Information Needed to Complete Your Application:
R Your Information: name, address, daytime phone number, SSN, date-of-birth, copy of official ID (driver's license, passport, birth certificate, immigration papers, or a state issued ID).
R Your Primary and Secondary Beneficiary's Information (you must choose at least one of each): name, address, SSN, date-of-birth, copy of official ID (see list above).
R Direct Deposit Information: checking or savings account and routing numbers.
R Benefit Estimate: you may use this as a reference to help you choose your monthly retirement benefit option and your PLOP payment (if applicable).
R PLOP Rollover (if applicable): name, address, and phone number for rollover institution, type of rollover plan, and your rollover account number.
R Tax Withholding Amounts: federal and state for monthly benefit payment, and PLOP if taking a lump-sum cash distribution.
R Your Alien Number Issued by the Department of Homeland Security or Other Federal Immigration Agency (if applicable)
If you are unable to complete and submit your application, you may log back into your account and continue at a later date. Please note that your online application will only remain active for 45 days. After 45 days, your application is void and you must begin the process again. z

P8
Pre-Retirement RChecklist
3 months to retirement
q Locate and make copies of acceptable photo identification (must show date of birth) for yourself and all of your beneficiaries. You will need to include the copies when you send in your retirement application or online summary sheet to TRS.
q Ensure that any service credit for which you are eligible to purchase is paid for prior to your retirement date. You will not be permitted to purchase any service credit once you retire.
q Verify that all of your unused sick leave credit is turned in to TRS from previous employers. Your current/last employer will submit your unused sick leave records to TRS after you terminate employment.
q If you have not submitted your online TRS retirement application, along with the other forms required for TRS to process your retirement, please do so now. Please submit your application no earlier than 6 months, but no later than 2 months, prior to your anticipated date of retirement if you want to receive your first check on time. Waiting could cause a delay, especially if an unexpected issue arises. To avoid losing any benefits, TRS must receive your application by the last day of the month in which you retire.
q Notify your personnel office of your intent to retire.
q Contact the State Health Benefit Plan or Board of Regents Health Plan again to see if any plan provisions or rules changed that you would need to know about prior to your retirement.
! Retired at Last
q Your first check will be mailed out around the middle of the month of your effective retirement date. All subsequent checks will be electronically deposited to your account on the 1st business day of each month. If eligible, you should receive your sick leave within 1-2 months after retirement.
q If you decide to work for a TRS covered employer while receiving a retirement benefit from TRS, you and your employer must contact our office prior to employment. Any earnings could affect your TRS pension and/or Social Security benefits. z

2011 Annual Membership Statement Online
In an effort to keep you updated about your retirement benefit, we have provided you with your account balance, the lump-sum value of your account (should you refund your contributions), various benefit projections, beneficiary information, as well as the service credit you have earned or purchased as a member of TRS.
If you are within 2 years of retirement (either because of your age or your years of creditable service) we do not provide you with benefit projections. Because you are so close to retirement, we recommend that you call our office and/or go online to make an appointment to visit one-on-one with a retirement counselor. This meeting affords you the opportunity to bring your spouse or a friend, receive benefit information specific to your situation, and ask questions.
To view or download your statement, please visit our website at www.trsga.com and log into your account or create a new one. z