It's that time of the year when retirement is on many people's minds - even if you're years away from the reality. Here are some questions we frequently answer about retirement:
Q: Does retirement begin automatically?
A: No. Retiring from your employer does NOT automatically trigger monthly pension payments. You must file an application with the system. Your effective date of retirement can be the same day you file, but you cannot apply any sooner than 90 days prior to your retirement date. Make sure your date of retirement is at least one day after your contract with your employer expires. File before June 14 if you want to receive your first payment in July. As always, check with your local president about whether your contract has any notification provisions or incentives.
We have seen cases where members retired, but never filed a pension application with the system. In one case, a woman retired in June and just assumed her pension check was delayed. By the time she checked with TRS at the end of September, she had already lost out on thousands of dollars in pension checks for July, August and September. Keep in mind it is YOUR responsibility to file a pension application, not the school district's.
Q: I was eligible to retire three years ago. If I file now, will I receive retroactive payments?
A: No. Retirement benefits are not retroactive. Some members mistakenly believe you have to wait to file for retirement if you are working elsewhere. If you are not working in New York state public employment, you may collect your benefit even if you are in private, out-of-state or federal employment. If you plan to work for a New York public employer in retirement, it's important you know the rules and income limits. (Check the Working in Retirement publication posted at www.nystrs.org.)
Q: What if laws or TRS rules change after I retire? Am I able to benefit from these changes?
A: If you retire on or after July 1, you would be eligible for any enhancements that become New York state law later that calendar year, unless otherwise indicated in the legislation. Otherwise, you are subject to the rules in effect at the time of your active membership. Generally, benefit improvements and changes are prospective, meaning they impact only current and potentially future members.
Q: I'm in Tier 3 but everybody says it's better to retire under Tier 4. What do I need to do to make sure I retire under Tier 4?
A: Absolutely nothing! Virtually all Tier 3 members will automatically retire under Tier 4, which doesn't have any Social Security offset and offers a higher pension calculation for those with 30 years of service. (Whenever one calculation is obviously better, you will automatically receive that benefit.)
Q: What if I change my mind about retiring?
A: There is a limited window for withdrawing or changing the terms of your retirement. From your date of retirement, you have 14 days to withdraw your retirement application and 30 days to change your benefit payment option. State law does not allow for exceptions. Your employer's policy for withdrawing a retirement application or changing a date of retirement may differ from TRS'. Some employers consider a letter of resignation or retirement irrevocable. Check with your local union representative.