CASH BALANCE PLAN
|CASH BALANCE PLAN |DEFINED BENEFIT PLAN |
| | |
|Immediate Vesting, but less contribution means less benefit |5 FTE years employment to vest. Required plan for Full-time |
| |faculty |
|4% Employee Contribution | |
| |8% Employee contribution |
|4% District Contribution into the employees account | |
| |8.25% District contribution |
|At Retirement or no longer teaching, you can withdraw funds in | |
|lump sum, or if over $3500 in account, you can arrange to draw a |At Retirement you will receive a life-time pension with optional |
|monthly annuity. If take annuity, then 1 year waiting period to|survivor benefits based upon the formula: service credit X age |
|return to part-time teaching. |factor X final compensation. |
| | |
|If under age 55 then a 6 month waiting period to receive lump sum|Once in the DB plan you may not choose to exit unless you leave |
|funds. If lump sum out, then may return to teaching, but may |the teaching profession and no longer work in a STRS school. |
|not take out funds for another 5 years. |Waiting period to return to teaching after receiving pension if |
| |under age 65. |
|May off-set Social Security benefits if you do not have 30 years | |
|of “substantial earnings”. |WEP may off-set Social Security benefits if you do not have 30 |
| |years of “substantial earnings”; |
|Does not have inflation guarantees or COLA. |GPO off-sets spousal benefit |
| | |
|No STRS disability insurance. |Yearly COLA of 2% |
| | |
|Cannot convert your accrued sick leave for credit. |Inflation guarantee of 85% purchasing power in benefit. |
| | |
|Convertible to Defined Benefit service credit. |Sick leave hours added to service credit at time of retirement. |
| | |
|Best for non-career teachers who work sparingly or will not vest |Permissive Purchase of CB years, other creditable service & air |
| |time |
| | |
| |Beneficial plan for PT faculty who work more than 40% or in more |
| |than one district and will vest in the plan. |
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