Any teachers/college faculty here?

[muledeerarea33?]

I know there are a few. New opportunities have me instructing for a local college. Never had a state job before and curious about benefits. Is the state pension worth it or would you rather take the self directed 403, 457? If you took the state pension and retired before full term… how were the health benefits? Tons of questions and opportunities, just looking for pros and cons. Thanks in advance.

[My Rights As An American]

I have 28 years with ASRS, so feel free to send me any questions. I work in school finance and know a bit about the system, but a lot of your questions will be about how long you plan to work in the system and what you hope to get out of it, and when. 

[knothead]

6 hours ago, My Rights As An American said:

I have 28 years with ASRS, so feel free to send me any questions. I work in school finance and know a bit about the system, but a lot of your questions will be about how long you plan to work in the system and what you hope to get out of it, and when. 

This

I started my 31st year in education and ASRS on Monday.  What is mentioned above is good information.  

[Ed67]

If you’re over 50 you can receive a pension and healthcare subsidy with at least 5 years service. The amount of both escalates with every continued year of service. The subsidy isn’t much but you have access to the healthcare plans offered by ASRS 

[muledeerarea33?]

10 hours ago, My Rights As An American said:

I have 28 years with ASRS, so feel free to send me any questions. I work in school finance and know a bit about the system, but a lot of your questions will be about how long you plan to work in the system and what you hope to get out of it, and when. 

I totally forgot you worked for the schools. My plan is 10 years maybe 15. The calculator on the state pension website shows that’ll be about a $1500 a month pension in 10-15 years. It’ll be an automatic 12% (matched) I think no matter what way I go, I’m just not used to having my money in something that I can’t control. 

[My Rights As An American]

I am NOT A FINANCIAL ADVISOR,  just my personal input only. Do not take anything i say as investing advice, please. May be easier talking offline as there is a ton to unfold.

 

Basically, you must select within the first 30 days of employment if eligible for the ORP. Otherwise, you defer to ASRS. It acts like a regular investment account similar to a public 403b or 401k that is contributed pre-tax. Your 7% contribution is matched by your employer, and vested after a certain number of years, 10 I believe I saw. Meaning, after XX years, your employer's contributions become fully yours. Before then, none of only a portion is actually yours to keep.  It is a defined contribution plan, so the value of the account is what it is worth when you withdraw monies. So you start with 7%, it is matched 100% and then you invest in one of the two plan carriers,  TIAA or Fidelity. Most likely through mutual funds. Personally, unless the salary is pretty high, 7% may not be a lot. But you can always supplement with another plan on your own if they offer a 403b or 457 plan. Have to check max contribution rates for your filling status. 

 

ASRS is a defined benefit plan, meaning you know what you will get at the end regardless of how much your input was all along. You contribute 11.98% this year, employer matches. Vesting in ASRS means nothing if you plan on retiring from the system and taking a pension benefit. It is one or the other. The value of what you contributed is ultimately useless. Your defined benefit is based on years of service, average salary and a define multiplier.

 

Your answer depends on what you have already done to invest for yourself for retirement, the kind of accounts those are in, how much time you have before drawing off the account, risk tolerance for investing, willingness to take less now into your account for potential for bigger returns in 10-15 years, and about a dozen other questions. 

 

Personally, I advocate for having more than your pension. The so called three legged stool of investing in yourself: pension, own investments and social security. 

 

Hope this helps. Call anytime. 

[Sam]

This is my 33rd year in public education - high school teacher for 5 years, and high school counselor for the rest of the time - coach and administrator thrown in there for good measure........I retired after 30 years with my full pension - which is 69% of the average of my highest 3 years of salary within the last 10 years of when I retired. So, coaching and coordinating summer school and many after school programs in my last 3 years really boosted my salary average prior to retiring.

If you work 20 hours or more per week, you are automatically participating in ASRS withholdings. I am almost certain you are required. They will withhold the 12% pre taxed and match the 12%. But when you retire, your pension is based on an average of what you made in the years prior to when you retire. The rules have changed since I was hired. You need to check the ASRS website, but they might average your last 10 years now; not just your highest three. 

I am still working full time at the high school and collecting a full salary and my pension. However, I waived my insurance at the school district and went on ASRS insurance. The state reimburses me $150 per month and my old school district reimburses me $370 per month. So, I pay about $150 per month for United Health Care. I will have this until I go on Medicare. If I take the school insurance, which I can for free, I have to work fulltime until 65 or pay about $1000 per month for private insurance - that is not my plan, so I took the deal with the reimbursement.    

While working I always put money into my HSA and pre taxed mutual funds. This lowered my taxable income. The HSA funds do not go away. 

I think having a state pension is the way to go and I would not have opted out of it if given the choice - but I never had a choice to opt out. It is a forced retirement plan and is well worth it. 

[muledeerarea33?]

Really good info! Thank you both! I have 25 years of 401k plus mutual funds already. So maybe the pension might be worth it. I’m going to reach out to you, my right as an American. Again, thank you guys. It a one time choice with no changing so I’m doing the best research that I can.

[My Rights As An American]

2 hours ago, Sam said:

This is my 33rd year in public education - high school teacher for 5 years, and high school counselor for the rest of the time - coach and administrator thrown in there for good measure........I retired after 30 years with my full pension - which is 69% of the average of my highest 3 years of salary within the last 10 years of when I retired. So, coaching and coordinating summer school and many after school programs in my last 3 years really boosted my salary average prior to retiring.

If you work 20 hours or more per week, you are automatically participating in ASRS withholdings. I am almost certain you are required. They will withhold the 12% pre taxed and match the 12%. But when you retire, your pension is based on an average of what you made in the years prior to when you retire. The rules have changed since I was hired. You need to check the ASRS website, but they might average your last 10 years now; not just your highest three. 

I am still working full time at the high school and collecting a full salary and my pension. However, I waived my insurance at the school district and went on ASRS insurance. The state reimburses me $150 per month and my old school district reimburses me $370 per month. So, I pay about $150 per month for United Health Care. I will have this until I go on Medicare. If I take the school insurance, which I can for free, I have to work fulltime until 65 or pay about $1000 per month for private insurance - that is not my plan, so I took the deal with the reimbursement.    

While working I always put money into my HSA and pre taxed mutual funds. This lowered my taxable income. The HSA funds do not go away. 

I think having a state pension is the way to go and I would not have opted out of it if given the choice - but I never had a choice to opt out. It is a forced retirement plan and is well worth it. 

You and I are under the old plan which changed for new hires after around July 2011. This is a different ASRS plan now, and since he is teaching college, he can actually opt out of ASRS within the first 30 days and do the new plan to invest himself in a self directed defined contribution plan. 

 

Anyone under the old ASRS plan who retired has a great plan, one of the best benefit plans in the entire country for sure! And one of the better funded for long term security. 

[My Rights As An American]

20 minutes ago, muledeerarea33? said:

Really good info! Thank you both! I have 25 years of 401k plus mutual funds already. So maybe the pension might be worth it. I’m going to reach out to you, my right as an American. Again, thank you guys. It a one time choice with no changing so I’m doing the best research that I can.

VERY smart to have invested in your 401k for so long. Someone taught you well early on! Thank them. 

 

I have been lucky enough to share my limited knowledge with many people who have thanked me for convincing them to invest in themselves financially. We now run a program in my current school district that I created to educate our employees in how to invest in themselves!

[sherman]

I have been with the local college have been for 10 years and retirement is awesome as well as non tangible benefits my wife and kids get free associates degree plus all the paid time off

[My Rights As An American]

Good chat last night, it was fun catching up for a bit! 

 

Tough decision but the nice thing is that with either decision you make, you end up with either a pension and other benefits if elected, or a chunk of money. Pros and cons to both options, but they both end up providing for you in the long run. 

 

That is the hard part to convey to new employees often, that yes, your paycheck is smaller today but 15-30 years from now, you will be extra glad that money was taken out for you. 

[deserttacoma84]

11 hours ago, My Rights As An American said:

Good chat last night, it was fun catching up for a bit! 

 

Tough decision but the nice thing is that with either decision you make, you end up with either a pension and other benefits if elected, or a chunk of money. Pros and cons to both options, but they both end up providing for you in the long run. 

 

That is the hard part to convey to new employees often, that yes, your paycheck is smaller today but 15-30 years from now, you will be extra glad that money was taken out for you. 

Brian is the man! Good info, Sir!