PERS Update
We hope you and yours continue to be healthy as we edge into fall. We want to send particularly good thoughts to our educators, who are working to get up to speed on the plan for this school year alongside the parents of their students!
PERS has provided some information on a couple of the recent changes we discussed in our last newsletter, with additional details to follow.
We previously described how the IAP investments have been changed to target date funds that center around a planned retirement year. You were automatically assigned to the fund closest to the year in which you turn 65, but some PERS employees are planning to retire earlier than that. For example, if you are planning to retire in 2025 but were allocated to 2030, changing your investment to a more conservative fund in the years leading up to your retirement should generally expose your IAP account to less volatility. The member choice window will be open for the month of September, and changes will go into effect on January 1, 2021, and that window will repeat annually. If you would like to make a change, the PERS instructions can be found on their website here.
By late September, PERS also plans to have the website ready to process those members that would like to contribute their own funds to the IAP. This relates to the portion of the contribution to the IAP that is being redirected to Employee Pension Stabilization Account (EPSA). For Tier 1 & 2 this amount is 2.5% of salary and for OPSRP it is .75%. Members will be able to elect to retroactively contribute back to July 1st when the redirect began. This is a one-time option and is only available until October 30th.
Due to budget issues, several employers have offered early retirement programs. These can be in different forms, and often include a payout either to help cover the cost of health care or as a contribution to a Health Savings Account (HSA). If your employer is among those offering an early retirement benefit and you are interested in whether this should be considered, please let us know. We are happy to help you understand the offer and how it fits in to your overall retirement plan.
Finally, PERS offers health coverage for retirees and their dependents. You can find information at pershealth.com. The plans are offered by Kaiser, Moda, PacificSource, Providence Health Assurance & United Healthcare. Current rates according to the website range from $923-$1,156 before Medicare and $248-$314 with Medicare. Not all firms offer pre-Medicare plans. High deductible plans are also offered by some of the companies, and in addition to health insurance, dental plans are also available.
If we can provide any assistance, please don’t hesitate to reach out.