Counselor Connection for Active Members
Our benefit counselors are a vital resource to our members. We are fortunate to have them on our team, providing valuable knowledge for members regarding their MOSERS benefits. It is our pleasure to have the opportunity to learn from them every day!
Meet Margie Bunch. Margie has been a senior benefit counselor with MOSERS for more than 9 years. Through her experience working with active members, she knows what information they need.
Margie’s thoughts for active members
Retirement is usually something that is done only once in an individual’s lifetime. As a result, it can be stressful. Good news! MOSERS is here for your benefit!
Keep in mind that MOSERS is not a “one-stop-shop” to cover ALL aspects of your transition into retirement. MOSERS will take care of your lifetime monthly pension benefit, your BackDROP payment (if eligible and if elected), and potential life insurance into retirement. MO Deferred Comp oversees your retirement supplemental savings. For most (but not all) state employees, Missouri Consolidated Healthcare Plan (MCHCP) administers your medical, vision, and dental insurance. Last of all, the Social Security Administration manages your Social Security benefits, including Medicare.
A good way to approach retirement is to start the process early and break it down into smaller parts.
Retirement planning can begin by requesting a benefit estimate from MOSERS or by calculating your own benefit estimate by logging in to myMOSERS. It is sometimes helpful to prepare benefit estimates using different retirement dates to evaluate how your benefit is affected by working longer. The benefit estimate will provide you with a lifetime gross monthly benefit amount, as well as BackDROP amounts if you are eligible for BackDROP. To be eligible for BackDROP, you must be a member of the MSEP or MSEP 2000 and have worked at least two years beyond your normal retirement date. (Legislators and statewide elected officials are not eligible for BackDROP.)
After you have estimated your gross lifetime monthly benefit, you can itemize the deductions from your monthly benefit. Deductions from your monthly benefit might include:
- Taxes - Your MOSERS benefit is subject to federal income tax and may be taxable by the state of Missouri if you are a Missouri resident. If you file a Missouri tax return, you may qualify for the Missouri Public Pension Exemption; please contact your tax advisor for more information on this. If you elect the BackDROP and choose the cash option, make sure you discuss this election with a tax professional to ensure you are aware of any tax implications that may result. For the best tax guidance, we encourage you to consult with a tax professional.
- Life Insurance Premiums - When you retire within 60 days of leaving state employment, you may elect to retain optional term life insurance. To be eligible, you must carry optional life insurance with MOSERS up to retirement and then elect to continue this coverage into retirement. The premiums will be deducted from your monthly benefit and will increase each time you enter a new age bracket. Please review the MOSERS Life Insurance page on our website for information on coverage limitations and premium rates.
- Medical Plan Premiums - You may carry your medical, dental, and vision insurance into retirement if your coverage is administered through the Missouri Consolidated Healthcare Plan (MCHCP). Contact MCHCP to determine the cost of your premiums at retirement. You can also log in to the MCHCP website to calculate these premiums after retirement. If you are 65 or older when retiring, you should also contact Social Security/Medicare to determine what benefits you should apply for and the deadlines for these applications.
By itemizing your retirement deductions, you can calculate your estimated net retirement income to determine if this will be sufficient income into retirement to meet your monthly expenses. It is a good practice to first determine how much monthly income you would need in retirement and then identify ways to get that amount. Keep in mind that just because you may be eligible for retirement, it doesn’t always mean you are financially ready for retirement.
Once you determine your retirement date, you will need to apply for retirement. Retirement benefits do not start automatically. You must apply within the appropriate deadlines. You can apply for retirement online by logging in to myMOSERS or you can request a retirement packet from MOSERS. Retirement is a two-step process.
Step 1 is to submit a Retirement Application and other retirement documents such as the direct deposit form, tax withholding form, and others. You may complete and submit your Retirement Application up to 120 days prior to your date of retirement. See the chart below for deadlines.
Step 2 consists of completing and submitting the Retirement Election Form and, potentially, the BackDROP Distribution Form.
On the Retirement Election Form, depending on your circumstance, you may have one, two, or three elections to make:
- Elect a benefit payment option (all retirees will make this election).
- Elect a retirement plan if you are a member of MSEP and get to choose between MSEP and MSEP 2000.
- If eligible, decide whether or not to take BackDROP. If you are eligible and elect BackDROP, you may also need to select your BackDROP period and will need to complete and submit the BackDROP Distribution Form to indicate if you want BackDROP to be paid as a direct rollover, a cash payment, or as a combination of the two.
The retirement process due dates are as follows:
Once you have submitted all retirement documents, MOSERS will send you a retirement confirmation letter, summarizing your elections and the retirement details. We will issue your first benefit payment on the last working day of your retirement month. If you are eligible and elected BackDROP, we will issue the BackDROP payment on this same date.
Prior to your end of employment, you will need to submit a letter of resignation to your agency and work out payment for any unused vacation pay. This is a process between you and your supervisor/HR department. MOSERS is not involved in this part of the process.
At any time during your retirement process, feel free to contact MOSERS and speak with a benefit counselor to answer any questions you may have.