1. Understanding Your Benefits under the FRS Pension Plan

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UNDERSTANDING YOUR RETIREMENT BENEFITS UNDER THE FRS PENSION PLAN

For FRS Members Enrolled Prior to July 1, 2011

Erin Rock, Secretary

PENSION PLAN MEMBER HANDBOOK

DIVISION OF RETIREMENT

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RETIREMENT GUIDES

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WWW.FRS.

DIVISION OF RETIREMENT

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DISCLAIMER

If questions of interpretation arise as a result of the attempt to make retirement provisions easy to understand, Chapter 121, Florida Statutes; Chapter 60S, Florida Administrative Code; and the Internal Revenue Code shall remain the final authorities.

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FRS HISTORY

? FRS created in December 1970 (TRS/SCOERS Merger) ? Only one plan ? FRS Pension Plan ? Employee contributions required

? Employee Non-Contributory System ? (Jan. 1, 1975 ? June 30, 2011)

? Three percent Employee Contributions effective July 1, 2011 ? FRS Investment Plan offered beginning July 1, 2002

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THE TWO FRS PLANS

Pension Plan

Investment Plan

My FRS Financial Guidance Line (866) 446-9377

Plan Choice Guidance

EY Financial Planners

Free, unbiased financial planning and counseling services

Chat live with EY Financial Planner

DIVISION OF RETIREMENT



Access financial planning tools and resources

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NORMAL RETIREMENT DATE

? Is when you are first eligible to receive an unreduced retirement benefit; and

? Is also when you are eligible to participate in the Deferred Retirement Option Program (DROP).

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NORMAL RETIREMENT DATE

? All Service Classes; except Special Risk ?

? Vested and age 62, or 30 years of service whichever occurs first; or ? the age after 62 when you become vested.

? Special Risk Class Service ?

? Vested and age 55, or 25 years of Special Risk Class Service whichever occurs first; or

? the age after 55 when you become vested.

? Dual Membership -

? Special Risk Class service and other class service ? Member Handbook ? Page 43

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NORMAL RETIREMENT DATE

? If reaching by age, your Normal Retirement date would be the first of the month you turn that age.

? If reaching by years of service, your Normal Retirement date would be the first of the month following the month you attain the years of service.

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NORMAL RETIREMENT DATE - DROP

? K-12 Instructional Personnel, may enter DROP at Normal Retirement or at anytime after reaching Normal Retirement and participate for a full 60 months.

? All others, unless you are eligible to defer your 60month DROP participation period, your 60-month DROP participation period starts at your Normal Retirement date. ? 12 month election window

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WHO CAN DEFER THEIR 60-MONTH DROP PARTICIPATION PERIOD?

? Special Risk Class ? Normal Retirement by years of service prior to age 52

? All other Classes ? Normal Retirement by years of service prior to age 57

? 12 month election window

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WHO CAN DEFER THEIR 60-MONTH DROP PARTICIPATION PERIOD?

? Elected Officials ? ? May defer DROP entry until the next term of office but can only participate in DROP for 60 months or the length of that term of office whichever is less.

? DROP Guide -Page 16

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WHAT IS DROP?

? Retiring under the FRS Pension Plan ? Delaying termination of employment up to 60

months ? Monthly retirement benefits accrue in your DROP

account ? Not subject to 3 percent employee contributions ? DROP interest ? Effective annual interest rate of 1.3

percent ? Cost-of-Living Adjustment (COLA)

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UPON TERMINATION OF DROP

DROP termination packet ? DP-Term form ? DP- PAYT form DROP accumulation paid in one of three ways: ? Lump-sum payment; or ? Direct rollover to an eligible retirement plan; or ? Partial lump-sum payment and partial direct rollover.

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THE BENEFIT CALCULATION FORMULA

Years of Service

X

% Value per Year

X

Average Final Compensation

= Option 1 Gross Annual Benefit at Normal Retirement Divide by 12 = Gross Monthly Option 1 Benefit

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