My MDC Retirement Benefits 2008

My MDCRetirement Benefits2008 Miami Dade College

Topics • FEDERAL BENEFITS • Medicare • Social Security • STATE BENEFITS • The Florida Retirement System [FRS] • Benefits Calculation • DROP • Health Insurance Subsidy (HIS) • COLLEGE BENEFITS • MDC Benefits • Tax Sheltered Annuity Plan 403 (b)

Florida Retirement System (FRS) • Created December 1970 • Defined Benefit Plan • Non-contributory system • Over 610,000 active members • Over 200,000 retired members • Over 175 million paid in monthly benefits

Benefits • Requirements for Normal Retirement • 6 years of Service • Requirements for Vesting • Age 62 or 30 years of service • Early Retirement • Benefit reduced 5% per year under age 62

Basic Benefit Formula Years of Service Based on Fiscal Year July 1st – June 30th x Value per year x AFC Average of HIGHEST Five Years of Salary = (Option One) Annual Benefit at Normal Retirement Divided by 12 = Monthly Benefit

Years of Service • Based on July through June 30 Fiscal Year • Completed work year • 10 Month Employee • 12 Month Employee • Less than complete work year • 10 Month Employee (5/10 = .50) • 12 Month Employee (5/12 = .42)

Years of Service May Include • Withdrawn or Refunded Service • Leave of Absence • 2 Years maximum • Must Return Immediately After Leave For One Complete Calendar Month • Must be vested before it is creditable • Military Service • Employed prior to 1/87 • Active duty during Wartime • 4 year maximum • Must be vested before it is creditable

Years of Service May Include • In-State Public Service • In-State Private School Service • Must Be Accredited and Non-Sectarian • Out-of State & Federal Public Service • Includes Non-Wartime Military Service

FRS Service Age 62 or 30 Years Age 63 or 31 Years Age 64 or 32 Years Age 65 or 33 Years TRS Service 1.60% 1.63% 1.65% 1.68% 2% Value Per Year for:

FRS Benefit Calculation

Early Retirement Calculation Age at Retirement – 55 years 2 months Option 1 Normal Ret. Benefit $1,654.22 Early Retirement Factor x 65.833% Option 1 Early Ret Benefit $1,089.02 • Benefit reduces to zero at age 42 • Reduction (5% a year) is based on number of months from normal retirement age of 62

Deferred Retirement Option Program (DROP) • Began July 1, 1998 • Must be vested and have reached normal retirement age (62) or date (30 years) • If 30 years BEFORE age 57, may defer starting DROP to any month up to age 57 • Must apply within Twelve (12) months from prior bullet or Only at eligibility date • Must establish future termination date • Maximum of 60 months / 5 years participation

Deferred Retirement Option Program (DROP) • Retirement benefits are “Banked” while continuing to work • Earn 6.5% annually compounded monthly on benefits including COLA • DROP benefits paid at termination are eligible for rollover to reduce taxes

Participating in DROP Annual FRS benefit when DROP begins $12,000 Annual FRS benefit after 5 year w/COLA $13,916 Drop lump sum benefit after 5 years $74,406 Continuing To Earn Additional Service Credit Annual FRS benefit after 5 more year of service $17,041 Based on 25,000 AFC & 30 yrs. vs. 3% Annual Salary Inc.; $28,982 AFC & 35 yrs.

Preparing to Retire or Enter DROP • You may request an audit of your account at any time to: • -Determine cost to buy additional service • -Verify total years or retirement credit • Request benefit estimate within 3 to 4 years of retirement date • Apply for retirement 3 to 6 months in advance, prior to TERMINATION date

At Retirement or Entering DROP • Birthdate Verification • Spousal Acknowledgement

At Retirement or DROP Entry • Designate A Beneficiary • Option 1 or 2 Anyone • Option 3 or 4 Spouse or Joint Annuitant • Choose An Option • Option 1: No Benefit After Member’s Death • Option 2: Ten Years Guaranteed • Option 3: Benefit Continues To Beneficiary • Option 4: Reduced Continuing Benefit To Survivor (1/3 reduction)

Option Calculation Member Age 60 & Spouse/J.A. Age 62

Reemployment After Retirement/DROP Exit • RESTRICTIONS APPLY ONLY TO FRS EMPLOYERS • 1st month of retirement • ANY WORK CANCELS retirement, All benefits lost • One month begins at effective date of retirement

2nd through 12th month of retirement • Benefit FORFEITED for ANY work in a month • Limited Exceptions • After 12 months of retirement: No restrictions • No restrictions on private employment

After You Retire/Exit DROP • Once a Benefit payment is cashed or deposited – retirement is final • Option cannot be changed • No service may be added • Benefits paid monthly • Electronic fund transfer

After You Retire/Exit DROP • Tax Withholding • Health Insurance Subsidy • Years of Service x $5.00 = Monthly Subsidy • Minimum Amount - $30.00 • Maximum Amount - $150.00 • Cost of Living Adjustment

MDC Benefits • MDC Individual Retiree Health Benefit Subsidy (IRHBS) • 30 years of service or age 62 & 10 yrs svc • 50 % - the first 10 years of service • 2.5% - each year above 10 years • Applicable only for Employee single coverage to offset the cost of coverage

MDC Benefits (continued) • Tuition Waiver • Library • Wellness Facilities • MDC Retiree Portal

Florida Retirement System • To obtain information about your benefits contact: • Division of Retirement Customer Service: 1-888-738-2252 • Website: http://www.dms.myflorida.com/retirement and http://www.myfrs.com

Social Security • Workers who pay into Social Security will receive a Social Security Statement every year 3 months before their birthday. This Statement is intended to help you plan your financial future by providing estimates of the monthly Social Security retirement, disability and survivors benefits you and your family could be eligible to receive now and in the future. • If you are near retirement age (age 62 and older) and are considering retirement, contact your local Social Security office to discuss your retirement options, or call 1-800-772-1213 to speak to a Social Security representative who will answer your questions. • We also invite you to try our Retirement Planner at http://www.socialsecurity.gov/retire2/

Social Security

Medicare There are two parts to Medicare: Hospital Insurance (sometimes called Part A) and Medical Insurance (sometimes called Part B). Generally, people who are over age 65 and getting Social Security automatically qualify for Medicare. So do people who have been getting disability benefits for two years. • Part A is paid for by a portion of the Social Security tax of people still working. It helps pay for inpatient hospital care, skilled nursing care, and other services. • Part B is paid for by monthly premiums of those who are enrolled and by transfers from the general fund of the U.S. Treasury. It helps pay for such items as doctor's fees, outpatient hospital visits, and other medical services and supplies. More information may be found in our publication called Medicare, publication number 05-10043 . Many of our other publications are available on the Internet at http://www.socialsecurity.gov/pubs/englist.html

Tax Sheltered Annuity Plan 403(b) Salary deferral or reduction plans in which employees allocate a portion of their pre-tax compensation to the plan.

Tax Advantages Contributions to the plan are excludable from the employee’s gross income, up to certain maximums.Earnings on funds accumulated in the plan are tax-deferred until taken as distributions.Prior to age 59 ½, a 10% penalty is applied toward early fund distributions.

Enrollment Requirements – TSA Accounts • For more information on TSA’s and a list of providers visit: https://www.mdc.edu/hr/Benefits/TSA/default.asp • Contact a TSA provider and complete the required forms, available online at: www.mdcc.edu/hr/forms: • Return the TSA application and enrollment forms to Janik Collin, Benefits Analyst at extension 7-0364.

For more information regarding Benefits: • Contact the Compensation & Benefits Main Number 305-237-2010 • Or visit our website at: http://www.mdc.edu/hr/Benefits/default.asp • You may also visit our new ASK HR site located at: http://support.mdc/ics/support/default.asp?deptlD=5314

My MDC Retirement Benefits 2008