What Steps Should I Take to Prepare to Collect MY NYS Pension?

Updated : Dec 10, 2019 in Articles

What Steps Should I Take to Prepare to Collect MY NYS Pension?


Welcome to our Video Guide
– Planning Your Successful Retirement created for New
York State executive branch employees. My name is Susan MacLennan and
I am sure you are excited about planning for your retirement. This series of short videos
was designed to provide you with essential information to
answer some of your questions. But these videos
are just a beginning. You have many important
decisions to make regarding your New York State pension, so we
encourage you to also consult with a representative from
the New York State Employees’ Retirement System. For additional information
regarding your pension, please refer to Chapter 9 of the online
version of the Self-Help Guide to Pre-Retirement Planning
available on the Work-Life Services website
at worklife.ny.gov. This video is entitled, What
Steps Should I Take to Prepare to Collect My New
York State Pension? Bonnie Clark, an Information
Representative from the Office of the State Comptroller,
will explain the importance of requesting a formal estimate
of your retirement benefits. She will also provide
information on choosing your retirement options and how
to file your application for service retirement. The key to successful retirement
planning is preparation. That preparation should
begin well before your date of retirement. One of the most important things
you can do when you begin to plan for your retirement is to
get an estimate of your pension benefits. You should request an estimate
approximately 18 months prior to your retirement date. It’s also important that you
consider your entire financial situation during the
retirement planning process. While many people focus mainly
on the amount of money they’ll be receiving, estimating what
your bills and other expenses will be when you retire
is just as important. Calculating a retirement budget
will help you to understand what your entire financial picture
might look like after you retire. While the Retirement System does
not administer health insurance benefits, they are a very
important component of the retirement process. You should contact the Health
Benefits Administrator in your human resources office to
discuss your health benefits. If you have taken the proper
pre-planning steps, the actual process for filing for
your retirement benefits is relatively easy. Shortly before your retirement
date, you must file an Application for Service
Retirement to apply for your pension benefits. One of the most important things
you’ll need to do when you begin to plan for your retirement, is
to request an estimate of your pension benefits. You can obtain a Request for
Estimate form on our website, or you can give us a call and we
can mail the form to your home. On the form, you’ll need to
provide us with an estimated Date of Retirement that is not
more than 18 months into the future. We recommend to most of our
members that they should request their first General Estimate 18
months prior to the date they will first become
eligible to retire. You must have at least five
years of service credit and be at least age 55 to be eligible
to collect a pension, so most members become eligible to file
a Request for Estimate form at the age of 53 and a half, using
their 55th birthday as their estimated Date of Retirement. Even if you don’t intend to
retire when you turn 55, it’s good to know what benefits would
be available to you if your circumstances were to
change unexpectedly. And while you can only request
one General Estimate every 18 months, we have a number
of other benefit projection services available to you if you
need to get updated information after your
receive your estimate. Just give us a call and
we’ll find a way to get you the information you need. There’s a number of good reasons
to request an estimate of your pension benefits. An estimate will help you decide
when might be the best time to for you to retire. Your pension benefit will be
an important piece of your financial picture in retirement,
so it’s critical to the planning process that you have a good
idea of the benefits you will receive before you
make any final decisions. Another important thing you’ll
need to consider when you retire is choosing a retirement option. The estimate results you receive
will provide information on the various retirement options
available to you, along with estimated annual and
monthly amounts for each option. It’s important to note that as
a retiree from our system, you will receive a pension benefit
from us every month for the rest of your life, no matter how
long you live or what retirement option you choose. Retirement options offer our
members the opportunity to select a beneficiary, or in some
cases multiple beneficiaries, to receive a portion of their
pension benefit after they pass away. You’ll have until the end of
the month in which you retire to choose your option, and you’ll
have only until the end of the month that follows that to
change your option selection. Because this becomes a permanent
decision, it’s very important that you approach the option
selection process from the proper perspective. It’s been our experience here at
the Retirement System that many of our members struggle with
understanding how to approach the retirement option selection
process, so I’d like to try and make that a
little easier for you. While it may be tempting to look
at the option amounts provided on your retirement estimate
as the logical first step to choosing the option that is
best for you, the reality is you should actually be looking at
your estimate near the end of the option selection
process, not at the beginning. The best way to figure out what
option works best for you is to first figure out what you might
need to leave your beneficiary. Try this approach. Consider what your beneficiary’s
financial picture would be like if you passed away and didn’t
leave them any additional or continuing pension benefits. Do your best to estimate how
much income they would have coming in each month without any
additional pension benefit, and just as importantly, you’ll need
to estimate what their bills and other expenses would
be like each month. At the end of that discussion,
you should have a better idea of how much additional money
your beneficiary may need to supplement the income they would
already have if you passed away before they did. It’s only after you’ve completed
that discussion that you should open up your retirement
estimate and look at the options available to you. Simply look for the option that
comes closest to meeting your needs. Stop and think
about it for a minute. How could you possibly pick the
option that’s best for you and your beneficiary if you don’t
figure out first how much more money they’ll need
if you passed away? Now that I’ve explained how to
approach the option selection process, let’s take a look at
the various options you’ll get to choose from. The Single Life Allowance option
would provide you with the maximum monthly pension amount
each month for the rest of your life. If you select this option, all
pension payments will stop when you pass way. The Cash Refund – Initial Value
option is available only to Tier 1 members. If you select this option, your
monthly pension benefit will be reduced every month for
the rest of your life. You can select one or multiple
beneficiaries, and you’re allowed to change your
beneficiaries after you retire. If you were to pass away before
we have paid you the Initial Value of your pension, we would
pay the remaining amount to your beneficiary or, if you have
multiple beneficiaries, we would split the remainder of
the benefit between them. The Joint Allowance options
offer you the opportunity to select a single beneficiary to
receive a continuing monthly benefit for the rest of their
life if you were to pass away first. You can choose to leave your
beneficiary the same amount of money that you’ve been receiving
each month, or you can choose to leave them only a portion
of what you’ll be receiving. If you select a Joint Allowance
option, your monthly pension benefit will be reduced every
month for the rest of your life. It’s also very important to note
that your beneficiary can never be changed after you retire, and
that if you’re beneficiary were to predecease you your monthly
pension benefit would remain exactly the same. The Pop Up Joint Allowance
options work just like the Joint Allowance options, but
with one added feature. Like the Joint Allowance
options, the Pop Up options offer you the opportunity to
select a single beneficiary to receive a continuing monthly
benefit for the rest of their life if you were
to pass away first. You can choose to leave your
beneficiary the same amount of money that you’ve been receiving
each month, or you can choose to leave them only a portion
of what you’ll be receiving. The added feature of
these options is that if your beneficiary were to predecease
you, your monthly pension check would pop up to the amount you
would have received under the Single Life Allowance option. If you select a Pop Up Joint
Allowance option, your monthly pension benefit will be reduced
every month for the rest of your life, and your beneficiary
can never be changed after you retire. If you select either the 5 or
10 Year Certain option, you can select one or multiple
beneficiaries, and you’re allowed to change your
beneficiaries after you retire. If you were to pass away before
we have paid you for a full five or 10 years since you retired,
we would continue to pay the same monthly pension amount
you were receiving to your beneficiary or, if you have
multiple beneficiaries, we would split the monthly benefit
amongst them for the remainder of the period you have chosen. For example, if you choose the
10 Year Certain option, and you passed away eight years after
you retired, we would continue paying your monthly
benefit to your beneficiary or beneficiaries for the remainder
of the 10 year period, or two more years. At that point, all
benefit payments would stop. In this example, if you live
longer than 10 years after you retire, there will be no
additional monthly benefits paid to any beneficiaries at
the time you pass away. We also offer a number
of alternative options. If none of the standard
options offered to you meet your specific needs, please contact
the Retirement System before you retire to discuss the other
options available to you. Any request for alternative
options must be made to the Retirement System prior to
your Date of Retirement. Shortly before you’re ready to
retire, you’ll need to file an Application for
Service Retirement. On this form you’ll need to list
all of the public employment you’ve had throughout your
career, and you must sign the form in front of a Notary Public
and have them certify your signature. The Application for Service
Retirement must be mailed to the Retirement System using
Certified Mail/Return Receipt requested at the post office,
or it can be submitted to a Retirement System representative
at one of the 16 retirement consultation sites located
throughout New York State. In addition to your retirement
application, you’ll also need to file a retirement option
election form and proof of your date of birth. If you selected an option
that will provide a continuing lifetime benefit to your
beneficiary upon your death, you’ll need to submit their
proof of date of birth as well. Do I have to pay
taxes on my pension? Your New York State pension is
federally taxable, and when you retire you must file a W4-P form
with us to let us know how much money, if any, you’d like to
withhold from your monthly check for federal taxes. If you decide to reside in
another state after you retire, you should check with that state
to determine if they will tax your New York State pension. Your pension is not subject to
New York State income tax or Social Security tax. Preparing for retirement may
seem like a difficult thing to do, but if you take the time and
make the effort to do the few things you need to do, you’ll
probably find it’s not as hard as you think. We encourage you to view the
other pension videos and to visit their website at
www.osc.state.ny.us. You may also call to speak
with a representative at 1-866-805-0990. Thank you for viewing this video
segment and for your service to New York State. We wish you a
successful retirement!

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