In This Edition
- Your 2013 Member Benefit Profile will be available in your myVRS account soon
- Don’t miss out on your MBP – register for myVRS
- Plan 2 members: You will have two valuable retirement planning tools available through myVRS
- A look into the hybrid plan – who it affects and what happens during the opt-in period
- National Save for Retirement Week is October 20-26
- Know your retirement benefit payment options – PLOP basics
- Learn how working after retirement could change your VRS benefits
- 457 Plan News – New record keeper selected
- Featured FAQ – When will I be eligible to retire?
Your 2013 Member Benefit Profile will be available in your myVRS account soon
“Helping you along the way”
Your 2013 Member Benefit Profile (MBP) will be available soon through your myVRS account.
What does this mean for you? The MBP is your online annual benefit statement based on information your employer reported to VRS as of June 30, 2013. It’s an important resource for planning your future. Want to know how much money you have in your member account? Want to see an estimate of your monthly benefit when you retire, and when you can retire? You will be able to find all this information in your 2013 Member Benefit Profile.
Your MBP gives you a complete overview of your benefits, including:
Your member account information, service credit and member contributions, membership date and life insurance coverage.
A description of the Benefit Estimator and Retirement Planner in myVRS.
Tips on how to increase your retirement savings.
If you participate, your 457 Deferred Compensation Plan account information and a retirement income gap analysis showing a total retirement income estimate compared to a retirement income target of 80 percent of your compensation.
Your employer will notify you when your MBP is available for you to review.
Don’t miss out on your MBP – register for myVRS
To review your MBP, you need a myVRS account. If you don’t have one, register for myVRS now.
Forgot your password?
If you already have a myVRS account, but forgot your password, you may access your account by confirming your identity and answering your secret question. Select Forgot Username or Password. If you need help, follow the link to myVRS Help.
If you are still unable to access your account, call VRS at 1-888-VARETIR (1-888-827-3847) to reset your password.
Plan 2 members: You will have two valuable retirement planning tools available through myVRS
If you are a Plan 2 member, your myVRS account will soon include access to your Member Benefit Profile (MBP) and the Benefit Estimator. This is the same access that has been available to Plan 1 members.
Your 2013 MBP is your online benefits statement. Your MBP helps you plan your retirement strategy by providing information about your retirement and other benefits as of June 30, 2013.
The Benefit Estimator is a tool that allows you to create retirement benefit estimates based on different retirement ages, dates and benefit payout options to see what retirement options work for you.
Find both of these benefit planning tools in your myVRS member account.
A look into the hybrid plan – who it affects and what happens during the opt-in period
What is it?
The VRS Hybrid Retirement Plan combines the features of a defined benefit plan, which pays a monthly retirement benefit based on age, total service credit and average final compensation, and a defined contribution plan, which provides a retirement benefit based on contributions to the plan and the investment performance of those contributions.
Who is eligible?
The plan will apply to most members hired on or after January 1, 2014. Eligible current members may opt into the hybrid plan during a special opt-in period.
When is the opt-in period?
The opt-in period will be from January 1 through April 30, 2014. During this time, you may make an irrevocable decision to opt into the Hybrid Retirement Plan. If you opt in, your hybrid plan membership becomes effective July 1, 2014. Resources will be available to help you in your opt-in decision, including an interactive comparison tool to assist you in comparing your current benefit under Plan 1 or Plan 2 to your estimated benefit if you decide to opt-in to the Hybrid Retirement Plan. In addition, VRS is planning state-wide meetings and webinars. More information will be available in the fall and in January 2014.
Are any members not eligible?
Some covered members will not be eligible to opt-into the hybrid plan:
- Optional Retirement Plan (ORP) participants
- Virginia Law Officers’ Retirement System (VaLORS) members
- State Police Officers’ Retirement System (SPORS) members
- Judicial Retirement System (JRS) members
- Political subdivision members who are covered by enhanced benefits for hazardous duty
How does it work?
Hybrid plan members contribute 4 percent of creditable compensation to the defined benefit plan and 1 percent to the defined contribution plan each month. Members may voluntarily contribute up to an additional 4 percent in 0.5 percent increments to the defined contribution plan each month, as shown in this chart. Members can increase or decrease their voluntary contributions on a quarterly basis.
With the mandatory and voluntary contributions to the defined contribution component of the plan, members can contribute a maximum of 5 percent with a 3.5 percent match from the employer. Members may choose the investment options that best fit their needs from a variety of investment choices.
National Save for Retirement Week is October 20-26
Retirement: It’s closer than you think. National Save for Retirement Week, October 20-26, is a good time to assess whether you will have enough funds set aside to live comfortably in retirement. If you haven’t started saving, it’s a good time to begin. If you are already saving, determine if you need to save more to build your retirement savings.
The Commonwealth of Virginia 457 Deferred Compensation Plan, a 403(b) plan or other tax-deferred savings plan make saving automatic each month. Use your Benefit Planner in myVRS to see how starting an account or increasing your contributions can add to your retirement income, and find out more about saving for retirement.
Know your retirement benefit payment options – PLOP basics
What is it?
The Partial Lump-Sum Option Payment (PLOP) is a retirement benefit payment option that reduces your monthly retirement benefit to provide a one-time lump-sum payment at retirement.
To be eligible for the Partial Lump-Sum Option Payment (PLOP), you must work at least one year beyond the date you are eligible for an unreduced retirement benefit. If you purchase prior service credit, it counts toward your eligibility for unreduced retirement, but you must be actually working one, two or three years beyond unreduced retirement eligibility to qualify for a PLOP. Prior service credit cannot substitute for this active service.
Lump-sum payment amount
The lump-sum amount depends on the number of years you work beyond your eligibility for an unreduced retirement benefit.
You may elect up to three times the amount of your annual Basic Benefit amount, which is a percentage of your average final compensation multiplied by your service credit at retirement.
|Active Service Beyond
|PLOP Payment Amount|
|*If you choose a lesser PLOP amount than you are eligible for, the remaining amount is considered part of your Basic Benefit|
|12 months||1 x annual Basic Benefit amount (one-year PLOP)|
|24 months||Choose a 1 or 2 x annual Basic Benefit amount (one- or two-year PLOP*)|
|36 months or more||Choose a 1, 2 or 3 x annual Basic Benefit amount (one-, two- or three-year PLOP*)|
The lump-sum payment is subject to taxes unless you roll it over to a qualified tax-deferred savings plan such as the Virginia Cash Match Plan or an Individual Retirement Account (IRA).
Learn how working after retirement could change your VRS benefits
Depending on the job you take, working after retirement may affect your VRS retirement benefit:
Your VRS benefit stops if you retire and then return to a VRS-covered position.
You continue to receive your VRS retirement benefit if you return to work for an employer that does not participate in VRS. For example, you can work full-time for a retailer or financial institution and continue to receive your VRS retirement benefit. However, if you accept a full-time position with a state agency such as the Department of Transportation, or a state university or county government or school system, you cannot continue to receive your retirement benefit because, except for a small number of localities with separate retirement systems, they all are VRS-participating employers.
You may be able to continue receiving your VRS benefit if you work in a non-covered position for a VRS-participating employer. To be considered non-covered, the position must be less than 80 percent of the hours required for a full-time, covered position.
If you return to non-covered employment with the employer from which you retired, you must have a break in service of at least one full calendar month from your retirement date.
You must not have a verbal or written offer of reemployment between you and your employer before you retire.
If you are unsure whether your new employer participates in VRS, please contact VRS before you begin work (especially full-time work) to check the employer’s status. Some employers, such as VCU Health System Authority, UVA Medical Center, and the Virginia Port Authority offer their own retirement plan but are still governed by the VRS return-to-work rules for retirees.
457 Plan News – New record keeper selected
Transactions will be unavailable from December 31 through January 8.
In January 2014, VRS will change record keepers from ING to ICMA-RC for the Commonwealth of Virginia 457 Deferred Compensation Plan, the Virginia Cash Match Plan, the Optional Retirement Plan for Political Appointees, the Optional Retirement Plan for School Superintendents and the Virginia Supplemental Retirement Plan.
During the transition period from 4 p.m. December 31, 2013 through January 8, 2014, members may review their accounts by going online or by calling ING at 1-VRS-DC-PLAN1 (1-877-327-5261). However, members will not be able to conduct transactions such as fund transfers or withdrawals. Funds will remain invested throughout the transition.
Q: When will I be eligible to retire?
A: Your eligibility for retirement depends on your plan:
|Normal Retirement Age||Age 65|
|Earliest Unreduced Retirement Eligibility||You become eligible for an unreduced retirement benefit at age 65 with at least five years (60 months) of service credit or at age 50 with at least 30 years of service credit.|
|Earliest Reduced Retirement Eligibility||You can retire with a reduced benefit as early as age 55 with at least five years (60 months) of service credit or age 50 with at least 10 years of service credit.|
|Normal Retirement Age||Normal Social Security retirement age|
|Earliest Unreduced Retirement Eligibility||You become eligible for an unreduced retirement benefit when you reach your normal Social Security retirement age and have at least five years (60 months) of service credit or when your age and service equal 90. Example: Age 60 with 30 years of service credit.|
|Earliest Reduced Retirement Eligibility||You can retire with a reduced benefit as early as age 60 with at least five years (60 months) of service credit.|
|Normal Retirement Age|
|Earliest Unreduced Retirement Eligibility||
You become eligible for an unreduced retirement benefit at age 60 if you have at least five years (60 months) of service credit or at age 50 with at least 25 years of service credit.
|Earliest Reduced Retirement Eligibility||You can retire with a reduced benefit as early as age 50 with at least five years (60 months) of service credit.|
How close are you? Check your MBP in myVRS.