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  • BackDROP Lump-Sum Payment

    Feb 8, 2019, 10:14 AM By MOSERS

    I keep being told that if a person work at least 2 years backdrop pass their normal retirement, they will receive their monthly lifetime benefits, plus whatever their lump sum amount is. Is the second part of this statement true? 

    Yes--If you are eligible for and elect BackDROP at retirement, you will get the one-time lump-sum payment plus monthly pension benefit payments for life.

    The tradeoff is that, in most cases, your monthly benefit payment will be less than it would have been if you hadn’t elected BackDROP.

    The reason most people have a lower monthly benefit when they elect the BackDROP is because any service and any salary earned during your BackDROP period (up to five years) doesn’t count when we calculate your monthly benefit amount. We use your years of service and your final average pay from BEFORE your BackDROP period.

    Your BackDROP lump sum will be equal to 90% of what you would have received during your BackDROP period if you had been retired during that time (based on the life income annuity amount).

    Our BackDROP page, with a BackDROP graphic near the bottom, may help you visualize how it works or you can read the BackDROP brochure for more information. BackDROP can be complicated to understand, so MOSERS benefit counselors are available to help by phone or through an in-person appointment. Call (800) 827-1063 to discuss your options. Counselors can also provide you with benefit estimates with and without the BackDROP so you can compare.

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  • State Employee Pay Raise

    Jan 31, 2019, 1:00 PM By MOSERS

    I am planning to retire 01/07/2019. My question is... IF we were to receive the much talked about raise in January of 2020 would that action have any impact on my retirement/backdrop?

    No, if you retired before a pay raise was given to active employees, any such increase would have no impact on you as a retiree.

    If you continued working beyond January 2020, got a pay raise, and did not take BackDROP, the impact of a pay increase on your monthly retirement benefit payment would be dependent upon how long you continue working.

    Remember, in calculating your monthly benefit, one factor is your Final Average Pay, which is your highest 36 consecutive months of pay. So, if you got a raise and worked a few months past 2020, the impact may be very small. If you got a raise and worked an additional 36 months, the impact would be bigger.

    Any pay earned during your BackDROP period has no impact on either your monthly benefit amount or your BackDROP lump-sum amount.

    But keep in mind that, by law, MOSERS retirees receive an annual cost-of-living adjustment (COLA) between 0-5%. You can find more information about the retiree COLA on our website.

    You can run benefit estimates under a variety of scenarios by logging in to myMOSERS or asking a MOSERS benefit counselor to run them for you. You may find our Creating a Benefit Estimate video and our Comparison Calculator helpful in weighing your options.

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  • Final Average Pay and BackDROP Period

    Nov 29, 2018, 10:43 AM By MOSERS

    My Pension is based on my best 36 months earnings. Wages during my 5 year BackDrop period are excluded. What if my best 36 months are after I complete my 5 year BackDrop period?

    Any pay earned after your BackDROP date (the beginning of your BackDROP period) does not count - it is excluded - when we calculate your monthly retirement benefit. We will look at your entire pay history in your MOSERS-covered employment prior to your BackDROP period to find your highest 36 consecutive months of pay and use that to calculate your monthly benefit.

    Remember, your BackDROP period, whether it is a 2-year or 5-year period, will always be immediately prior to your retirement date. That means, you wouldn’t continue to be employed in a MOSERS benefit-eligible position after your BackDROP period.

    This is one of the factors to consider when making your elections about BackDROP. You can run benefit estimates under a variety of scenarios by logging in to myMOSERS or contact a MOSERS benefit counselor to run them for you. You may find our Creating a Benefit Estimate video and our Comparison Calculator video helpful in weighing your options.

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  • COLAs and BackDROP

    Nov 16, 2018, 1:36 PM By MOSERS

    My retirement date is January 1, 2019 and my backdrop date is March 1, 2016. Will I receive a COLA on my backdrop date in March, 2019?

    Typically, members receive a COLA each year on the anniversary of their retirement date, unless one of the exceptions* applies. In your case, since you elected BackDROP, your COLAs will be payable each year on the anniversary of your BackDROP date rather than on the anniversary of your retirement date. In your specific case, your COLAs will be awarded in March, and you will receive a COLA on March 1, 2019.

    We will determine the 2019 COLA in mid-January of 2019, and will announce the COLA amount on our website. We will send you (all members) a notice, either in the mail or in your MOSERS Document Express online mailbox, when the COLA is applied to your monthly benefit payment.

    *The other exceptions of when COLAs are applied include:

    • Retirees who converted from MSEP to MSEP 2000 during the conversion window in 2000 have COLAs payable each year in July.
    •  MSEP 2011 members hired after January 1, 2018 who leave state employment prior to retirement eligibility, will receive their first COLA in retirement on the second anniversary of their retirement.
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  • BackDROP & Reemployment With the State

    Sep 19, 2018, 11:01 AM By MOSERS

    If I retire with Backdrop, how long do I have to wait if I want to start back working in a state-paid position?

    If you retire and return to work in a benefit-eligible* position, your monthly retirement payment will stop as soon as we are notified that you are re-employed. Once you have worked for at least 12 continuous months in your new benefit-eligible position, you will begin accruing a separate retirement benefit.

    Once you re-retire, your previous benefit will restart and your new benefit (based on your new service and salary) will be calculated and your benefit payments (old benefit plus new benefit) will resume. You are not allowed to elect BackDROP after you have first retired. In other words, you will not be eligible for BackDROP if you return to state employment after having already retired from the state.

    If you retire and return to work in any position not covered by MOSERS or MPERS (including work for the state in a non-benefit-eligible position), you may continue receiving your MOSERS pension benefits and earn as much as you wish. Such employment will have no effect on your MOSERS benefit.

    *A benefit-eligible position is one that normally require at least 1,040 hours of work per year, is permanent in nature, and is covered by MOSERS or the MoDOT and Patrol Employees’ Retirement System (MPERS). Your employer, not MOSERS, determines if you are working in a benefit-eligible position.

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  • BackDROP & Returning to Work

    Aug 28, 2018, 1:13 PM By MOSERS

    What would happen if I retire and draw backdrop and later decide to return to work for the State in a benefit eligible position? I know my retirement benefit would stop but what would happen with the backdrop?

    If you retire and return to work in a benefit-eligible* position, your monthly retirement payment will stop as soon as we are notified that you are re-employed. However, any BackDROP money you received is yours to keep – there is nothing that requires you to return any of it to MOSERS if you return to work. Once you have worked for at least 12 continuous months in your new benefit-eligible position, you will begin accruing a separate retirement benefit. Once you re-retire, your previous benefit will restart and your new benefit (based on your new service and salary) will be calculated and your benefit payments (old benefit plus new benefit) will resume. You are not allowed to elect BackDROP after you have first retired. In other words, you will not be eligible for BackDROP if you return to state employment after having already retired from the state.

    If you retire and return to work in any position not covered by MOSERS or MPERS (including work for the state in a non-benefit-eligible position), you may continue receiving your MOSERS pension benefits and earn as much as you wish. Such employment will have no effect on your MOSERS benefit.

    *A benefit-eligible position is one that normally require at least 1,040 hours of work per year, is permanent in nature, and is covered by MOSERS or the MoDOT and Patrol Employees’ Retirement System (MPERS). Your employer, not MOSERS, determines if you are working in a benefit-eligible position.

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  • BackDROP & Survivor Benefit?

    Aug 21, 2018, 3:31 PM By MOSERS

    If I have completed my five year backdrop period and continue working in my state position, would my spouse receive the backdrop lump sum payment if I died while still working?

    For example, if I completed the five year backdrop period on 8-1-2018, continued working, planned on retiring on 6-1-2019, but died on 3-1-2019 - would my spouse receive the lump sum back drop as well as the monthly survivor pension benefit, or would she just receive the monthly survivor pension benefit?

    If you pass away before your retirement date, any elections you made about retirement are null and void, including any elections about BackDROP. If you were still working and had not yet reached your retirement date, you are considered an “active member” and we must pay your eligible survivor. Your spouse’s monthly survivor benefit would be based on the Joint & 100% benefit payment option and calculated using your final average pay and credited service as of your date of death. Your spouse would not receive the BackDROP lump-sum payment if you died prior to your retirement date. In calculating your spouse’s monthly benefit, we would count the time in what would have been your BackDROP period – your total years and months of creditable service. For more information regarding survivor benefits, please visit the death of a member section of our website.

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  • High 36

    Aug 3, 2018, 1:52 PM By MOSERS

    My five year BackDROP period is complete. I know my retirement check is based on my best 36 months. If I do not elect BackDROP, Can I use my best 36 months throughout my entire career, or only the period prior to my original BackDROP date?

    Yes, if at retirement you do not elect BackDROP, we will review your entire pay history and find the 36-month period with your highest pay, which may be in your final years of employment, and will use that in calculating your monthly benefit.

    Background for Other Readers: Any pay or service you get during your BackDROP period is not counted when calculating your monthly benefit payment. If you become eligible for and elect the BackDROP upon retirement, your highest 36 consecutive months would be determined from your MOSERS-covered work history prior to your BackDROP date.

    But keep in mind, you are not required to take BackDROP, regardless of how long you work beyond normal retirement eligibility, and you don’t have to notify MOSERS of any decisions about BackDROP until you retire. You may elect not to take BackDROP if you want all your service and pay to count and, likely, increase your monthly benefit.

    Our BackDROP page, with a BackDROP graphic near the bottom, may help you visualize how it works or you can read the BackDROP brochure for more information. BackDROP can be complicated to understand, so MOSERS benefit counselors are available to help by phone or through an in-person appointment. Call (800) 827-1063 to discuss your options. Counselors can also provide you with benefit estimates with and without the BackDROP so you can compare.

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  • Final Average Pay & BackDROP

    Aug 1, 2018, 12:53 PM By MOSERS

    Note: the question below refers to a previous Rumor Central question from July 2018:

    "As you referenced, FAP is determined using your highest 36 full consecutive months of pay when looking at your entire work history covered under MOSERS. Practically speaking, for most, that is their last three years, but not always. The exception to this would occur under the BackDROP (if eligible). If you become eligible for and elect the BackDROP upon retirement, your highest 36 consecutive months would be determined from your MOSERS-covered work history prior to your BackDROP date. In other words, any pay or service during your BackDROP period doesn’t count toward your monthly benefit payments."
    Okay, based off this information, since I am working on my back-drop currently, an increase in pay will NOT increase my retirement? I am planning on working overtime as a Correctional Officer, will this have an effect on the amount of money I receive in my retirement? Yes or No...

    You are correct that pay earned during your BackDROP period will not count towards calculating your retirement benefit. Your monthly benefit will be calculated using your final average pay (FAP) and credited service as of your BackDROP date (the day your BackDROP period begins).

    Any pay or service you get during your BackDROP period is not counted when calculating your monthly benefit payment. To be clear, any overtime pay you receive during your BackDROP period will not be considered in calculating your final average pay. But keep in mind, you are not required to take BackDROP, regardless of how long you work beyond normal retirement eligibility, and you don’t have to notify MOSERS of any decisions about BackDROP until you retire. You may elect not to take BackDROP if you want all your service and pay to count and, likely, increase your monthly benefit.

    Our BackDROP page, with a BackDROP graphic near the bottom, may help you visualize how it works or you can read the BackDROP brochure for more information. BackDROP can be complicated to understand, so MOSERS benefit counselors are available to help by phone or through an in-person appointment. Call (800) 827-1063 to discuss your options. Counselors can also provide you with benefit estimates with and without the BackDROP so you can compare.

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  • BackDROP Payment

    Jul 26, 2018, 3:57 PM By MOSERS

    If you opt to have the cash pay-out of your backdrop, how long does it take after your retirement date to receive it?

    Your BackDROP* payment (either cash or rollover) will be paid on the last working day of the month your retirement is effective, along with your first monthly retirement benefit payment. For example, if your retirement date is May 1, your BackDROP payments will be made on the last working day of May. This is assuming you have completed all necessary forms, including your BackDROP Distribution form, when you retire online or on paper.

    Please be sure to read the Special Tax Notice brochure on our website to learn about various tax consequences if you take some or all of your BackDROP payment in cash.

    *BackDROP is an option that allows eligible members to receive a lump-sum payment in addition to an ongoing monthly payment. It is available only to general state employees who are members of MSEP & MSEP 2000 and who work at least two years beyond normal retirement eligibility.

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Disclaimer

We strive to provide the most accurate information possible in our answers to Rumor Central questions. However, occasionally, laws, policies or provisions change and individual circumstances may vary. Please contact a MOSERS benefit counselor or see the handbooks in our website Library for more detailed information. If there is any difference between the information provided in this blog or on the MOSERS website and the law or policies that govern MOSERS, the law and policies will prevail. See our Privacy, Security,& Legal Notices for more information.

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