Monthly Archives: August 2018

Infographic regarding spending habits

Spending Changes in Retirement

Just like starting your first job, getting married or having kids, retirement will change your life. Some changes are small, like sleeping in or shopping during regular business hours. Others, however, are significant and worth examining ahead of time… like how much you’ll be spending in retirement each month or each year.

An Employee Benefit Research Institute (EBRI) study offers some good news for prospective retirees. Household spending generally drops at the beginning of retirement — by 5.5 percent in the first two years, and by 12.5 percent in the third and fourth years. (Although, nearly 46 percent of households actually spend more in the first two years of retirement.)

Analysis from the Bureau of Labor Statistics in the U.S. Department of Labor seems to support the research from EBRI. In “A closer look at spending patterns of older Americans,” the author analyzed data from the 2014 Consumer Expenditure Survey, and she also found a progressive drop in spending as age increases. (Income declines with age as well.)

While data supporting EBRI’s study is helpful, it turns out that the highlight of the Consumer Expenditure Survey results is a detailed look at how the things we spend our money on change as we grow older.

Infographic regarding spending habits

As interesting as that is, it’s just a general look at how older Americans are managing their money. What really matters is: How will you spend your money once you retire?

Prepare a Post-Retirement Budget

Like a fiduciary choir, financial advisors all sing the same refrain: Start young; save and invest regularly to meet your financial goals. If you do, the switch from saving to spending in retirement can be easy.

But, in order to make that transition, you need a budget.

The first step toward a post-retirement budget is a review of what you spend now. For a few months, track how you spend your money. Don’t forget to include periodic costs, like car insurance payments or property taxes. By looking at your current spending patterns, you can get an idea of how you’ll spend money come retirement.

Then, consider your current monthly income, and estimate your post-retirement income. If your post-retirement income is less than your current income, you might want to plan to adjust your expenses or even consider changing your retirement date.

We have monthly expense and income worksheets to help with this exercise. You can print them out and start planning ahead for post-retirement spending.

Monthly budgeting worksheets (PDF)

Monthly Worksheets (PDF)

For those of you who carry smart phones, Forbes put together a list of popular apps for tracking your daily spending. All of them are free, though some do sell extra features. Many of them can automatically pull in information from your bank and credit card accounts, but if you’d rather avoid that exposure or if you use cash regularly, you may prefer an app that lets users enter transactions manually.

See You at the Fair

The Great New York State FairThe 178th Great New York State Fair opens next week and NYSLRS will be there.

The 13-day celebration of everything New York runs through Monday, September 3 (Labor Day). Our information representatives will be at the fairgrounds, as they have been for more than 20 years, to help members and retirees with their retirement planning and benefit questions. In the past, many NYSLRS members have stopped by the booth to get a benefit projection. You’ll also be also be able to pick up retirement plan brochures and forms or have a consultation with one of our information representatives.

The NYSLRS booth will be in the Center of Progress Building, building 6 on the State Fair map, near the Main Gate. Once inside, you can find us against the wall on the east side.

Find Unclaimed Funds at the State Fair

OSC’s Office of Unclaimed Funds booth will be in the same building, just across from the NYSLRS booth. An unclaimed fund is lost or forgotten money, perhaps in old bank account or insurance policy that has been turned over to the State. See if any of that money might be yours. So far this year,  State Comptroller Thomas P. DiNapoli and the Office of Unclaimed Funds has returned more than $284 million.

Comptroller DiNapoli visits the New York State Fair

Comptroller Thomas P. DiNapoli greets a NYSLRS member at the Fair.

The Retired Public Employees Association (RPEA) will also have a booth in the Center of Progress Building.

Special State Fair Days

Wednesday, August 22

  • Opening Day — $1 admission

Friday, August 24

  • Pride Day — LGBT choirs, parade

Monday, August 27

  • Law Enforcement Day — Free admission for law enforcement personnel and corrections officers
  • Senior Citizen’s Day — Free admission for senior citizens (60+)

Tuesday, August 28

  • Comptroller DiNapoli Visits the Fair — He manages the $207.4 Billion State Pension Fund and is the administrator of NYSLRS. He’ll be stopping by NYSLRS’s booth during the day.
  • Fire & Rescue Day — Free admission for active and retired members of fire departments and emergency services organizations
  • Senior Citizen’s Day — Free admission for senior citizens (60+)

Wednesday, August 30

  • Women’s Day

Thursday, August 31

  • Armed Forces Day — Free admission for active duty or veterans

Note: ID required for free admissions listed above. For details, check out the complete schedule of Special Fair Days.

Overtime Limits for Tier 5 and 6 Members

The formula used to calculate your NYSLRS pension varies by tier and plan, but your credited service and final average salary (FAS) are the main factors. You earn service credit for paid service with participating employers, and you also may claim it for some previous public service. Your FAS is the average wage you earned during the time period when your earnings were highest (36 consecutive months for Tier 5 and 60 consecutive months for Tier 6).

Your FAS can include overtime pay that you earned during that period. However, for Tier 5 and 6 members, there are limits to how much overtime can be used to calculate your pension.

While you can earn overtime beyond the limit, anything over it will not count toward your FAS or your retirement benefit. Members and employers aren’t required to make contributions on overtime pay that is above the limit, and your employer shouldn’t report it to us.

Tier 5 Overtime Limits

The overtime limit for Tier 5 Employees’ Retirement System (ERS) members increases each calendar year by 3 percent. This year, the limit for Tier 5 ERS members is $19,001.55. For 2019, it will be $19,571.60.

For Tier 5 Police and Fire Retirement System (PFRS) members, the overtime limit is 15 percent of your regular earnings each calendar year.

Tier 5 & 6 Overtime Limits

Tier 6 Overtime Limits

The overtime limit for Tier 6 ERS members increases each calendar year based on the annual increase of the Consumer Price Index (CPI). For 2018, the limit is $16,406.

For Tier 6 PFRS members, the overtime limit is 15 percent of your regular earnings each calendar year.

Find more information about the overtime limit, FAS and retirement calculations in your retirement plan booklet, available on our Publications page.

Learn More

Find more information on our overtime limits pages for Tier 5 and Tier 6. And, find your retirement plan booklet on our Publications page for details about overtime, FAS and retirement calculations.

Knowing Your Retirement Plan is the Key to Retirement Planning

Information is the key to being fully prepared for your retirement years. The single most important thing you can do to achieve this goal is to know what NYSLRS retirement plan you’re in. Once you know that, the next thing you must do is understand the benefits your plan provides.

Your retirement plan booklet covers things like how long you’ll need to work in order to receive a pension, how your pension amount is determined, and what kind of death and disability benefits may be available to you. You can find a copy of your plan booklet on our Publications page.

But here’s the challenge: NYSLRS manages 335 retirement plan combinations, which are described in 51 plan booklets. How do you figure out which is yours?  The information below should help.

Two Key Questions

To get started, you need to answer two questions.

Question One: Which retirement system are you in? NYSLRS is made up of two different systems:

  • The Employees’ Retirement System (ERS), which is for public employees in non-teaching positions. It also includes some law enforcement personnel, such as correction officers, sheriffs and sheriffs’ deputies.
  • The Police and Fire Retirement System (PFRS), which is for paid firefighters and police officers, including SUNY police, State Park police, Encon officers and State Forest Rangers

Question Two: Which tier are you in? There are six tiers in ERS and five tiers in PFRS. Your tier, based on when you joined NYSLRS, determines such things as when you become eligible for benefits and how much you contribute. You can find your Tier on page 2 of your Member Annual Statement (MAS) or you can check the NYSLRS website.

For many members, knowing your retirement system and tier are enough. But for other members, especially those in law enforcement, it may help to have your retirement plan number as well. The plan number indicates the section of Retirement and Social Security Law the plan is based on. For example, Plan A15 indicates that you are covered by Article 15. You can find your plan number on page 4 of your MAS, in the Salary Information section.
Member Annual Statement example

Roughly three-quarters of all ERS members are covered by Article 15; they just need to know their tier to find the correct booklet.

State police , SUNY police , State Encon Officers , State Park Police and Forest Rangers each have their own plan booklet, which can be found in the PFRS section of the Publications page. That’s also where you’ll find the Special 20- and 25-Year Plans , which cover officers in most municipal police departments. (Members in these special plans should see 384, 384-d or 384-e listed in the plan information in their MAS.)

If you are still unsure which retirement plan booklet covers your benefits, you can send us an email using our secure contact form , or you can ask your employer.

Retirement Plan Booklet

Take the Time to Understand Your Retirement Plan

It cannot be stated enough how important it is to read your plan publication to learn all you can about your benefits. It is the key to solid retirement planning. Remember, no one has a more vested stake in your retirement than you do.

Creditable Service for Police & Fire Members

The New York State and Local Police and Fire Retirement System (PFRS) provides service and disability retirement benefits, as well as death benefits to more than 35,000 police officers and firefighters.

Most PFRS members are covered by a plan that allows for retirement after 20 or 25 years, regardless of age, without penalty. As a member, you earn credit toward that requirement through paid public employment with participating employers. However, not all public service counts toward your 20 or 25 years.

What Credit Counts Towards Retirement?

The public service that can be used toward your 20 or 25 years is determined by the specific retirement plan under which you’re covered. Check your retirement plan booklet for details.

There are booklets for state police , forest rangers , regional state park police , state university police , EnCon police and members covered under Sections 384, 384-d and 384-e of Retirement and Social Security Law (RSSL). More plan booklets are available on our Publications page.

The most common PFRS plan, which covers nearly 50 percent of PFRS members, was established by Section 384-e of RSSL. With this plan, you earn creditable service:

  • As a firefighter or police officer under the 384-e plan;
  • As a member or officer of the New York State Police; or
  • In the military, as specified by law.

In the 384-e retirement plan, civilian service, as well as service as a sheriff, corrections officer or volunteer firefighter, is not creditable.

creditable service for police and fire retirement system members

Transferring Membership or Purchasing Service Credit — Contact Us First

If you have worked for multiple New York State public employers and are unsure if all of your service is creditable towards your 20 or 25 year plan, contact us before transferring membership or purchasing service credit . Please note: the public service that can be used toward your 20 or 25 years is determined by legislation and differs among plans offered to PFRS members. You should also be sure to request an estimate from us well before your planned date of retirement if there is any question about your creditable service.

Get an Estimate

PFRS members should request an estimate from us as early as 18 months before you plan to retire. It’s the best way to make sure you have all the credit you’re entitled to. Simply fill out and return a Request for Estimate (RS6030) form.