Secure Your Future
Members have strong financial protections in the event of disability
May 10, 2007 3:22 PM
A recent poll showed that 13 percent of Americans think they could become disabled and unable to work, according to the National Association of Insurance Commissioners. The Social Security Administration, however, reports that about 20 percent of individuals will become disabled for a year or more before age 65.
We UFTers have great protection in this area. We can accumulate up to 200 days in our Cumulative Absence Reserve (CAR) — sick bank. If we use up these days, we can borrow up to 20 additional days, or we can get a grace period for up to a calendar month. After that, we can use the Welfare Fund’s disability program that provides up to $350 per week for up to 28 weeks.
Then we can apply for a disability retirement. If the disability is the result of a school-related accident that was not caused by your own negligence, protection is available from the date your membership in the Teachers’ Retirement System began. For most people, the benefit pays 67 percent of final average salary for life. There is a small group of members who may even get more. This benefit gets very favorable income tax treatment.
If the disability is not related to the job, if a member has 10 years of credited service in the TRS and cannot return to work, he or she can retire and collect up to one-third of the final average salary — or more — for life.
In addition, there is a disability benefit available under Social Security with its own set of rules.
All of this protection is provided through your employment. This protection can be extended by the voluntary purchase of disability insurance. NYSUT, through its Member Benefits program, offers a competitive additional disability insurance plan. You may contact NYSUT Benefits at 1-800-626-8101.
Baby boomers’ malaise
There are about 52,600 baby boomer members in the TRS. They are very different from the 75 percent of boomers in America who are worried about their family’s financial future.
In fact, most members of the baby boom generation are more concerned about retirement security than they are about current unemployment. A MetLife study found that 60 percent of boomers define the “American Dream” as financial security. This topped having children, owning a home or having a successful career.
This feeling of malaise may be due to the reduction in the number of Americans who are covered by a traditional pension and who have retiree health insurance. Our members do not have the same concern because they know that they will have financial security when they retire.
Unclaimed funds
The TRS Web site, http://www.trs.nyc.ny.us, has an unclaimed funds section. If you are retired or know a retired member, check the site to see if there are checks that have not been claimed.
While we are at it, we will remind you of another Web site, www.unclaimed.org, that lists more than $24 billion of unclaimed funds from such sources as old bank accounts, uncashed checks, utility deposits and others. State governments hold these unclaimed funds and would like to return them to the rightful owners. It is recommended that you search for unclaimed funds in each state in which you lived.
TRS reminders
1. Have you filed the tax-deferred annuity enrollment form that you received in connection with the TRS’ Spring Campaign? If you do not file promptly, deductions cannot be made before the advance printing of summer payroll checks by the Department of Education.
2. Have you filed up-to-date designation of beneficiary forms for both the Qualified Pension Plan and the TDA?
3. Have you provided the TRS with date-of-birth documentation?
4. Does the TRS have your current address?
5. If you plan to change your TDA investment elections, have you filed? The application must be received at TRS by June 1.
Retiring at end of school year?
No one should retire without a final consultation with a UFT pension consultant. It is suggested that you bring your spouse, signo (significant other) or financial advisor to the session. The consultation will:
• provide an estimate of your retirement allowance;
• review lump-sum withdrawals at retirement and the benefits and consequences of doing so;
• review TDA choices at retirement;
• review retiree health insurance and Welfare Fund benefits;
• discuss the effect of variable or fixed annuities (Tier I/II);
• discuss general tax information on retirement income; and
• provide help in filling out and filing forms.
You should set up an appointment by calling the UFT Pension Department at 1-212-598-6866. Call now if you are retiring at the end of the school year or at the end of summer school.
“Secure your future” is compiled and written by Mel Aaronson, Sandra March and Mona Romain, teacher-members of the NYC Teachers’ Retirement Board. For further information on items discussed, call your UFT borough office or the TRS. BRONX: 1-718-379-6200; BROOKLYN: 1-718-852-4900; MANHATTAN: 1-212-598-6800; QUEENS: 1-718-275-4400; STATEN ISLAND: 1-718-605-1400; Teachers’ Retirement System: 1-888-8NYC-TRS (692-877), http://www.trs.nyc.ny.us.
