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USC Benefits Administration “Taking pride in your peace of mind ” Planning for Retirement: Strategies, Options & Information Transitions 2015 Presented.

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Presentation on theme: "USC Benefits Administration “Taking pride in your peace of mind ” Planning for Retirement: Strategies, Options & Information Transitions 2015 Presented."— Presentation transcript:

1 USC Benefits Administration “Taking pride in your peace of mind ” Planning for Retirement: Strategies, Options & Information Transitions 2015 Presented by Awilda P. Bregand Executive Director, Benefits Administration

2 | 2 Life Insurance

3 | 3 S hould I continue after retirement? Start by evaluating your family's needs. – Will there be a mortgage remaining? – Will there be outstanding medical or credit cards bills? – Are there children who may need money for college? Bear in mind that usually as retirement savings increase the need for life insurance should decrease

4 | 4 What do I currently have? Basic Term Life Insurance – University paid – 1x your annual salary – up to a maximum of $50,000 – reduces to 65% at age 65 and 50% at age 70 Supplemental life insurance - available for employee and dependents – paid for entirely by employee – No age reduction

5 | 5 Do you really need to continue? Basic Term Life – free now but will cost in retirement – Example - maximum coverage at age 65 - $32,500(65% of $50,000) 32.5 x 2.54 = $82.55 per month Supplemental Life – rates remain the same as when you were an active employee – Example -$200,000 in Supplemental coverage at age 65 200 x 0.749 = $149.80 per month If you wish to continue – Contact Minnesota Life at (866) 293-6047

6 | 6 Accidental Death & Dismemberment (AD&D)

7 | 7 What do I currently have? $10,000 Basic Insurance – University paid – Plan C participants receive $100,000 $100,000 Business Travel Accidental Death Insurance – University paid Supplemental AD&D available for employee and dependents – paid for entirely by employee – Globe Rescue Travel Assistance Program Automatically included with Basic AD&D coverage or call (815) 516-5433 Continue? Personal decision, is very inexpensive but do you really need especially since none of the ancillary add-ons (travel assistance, etc.) continue only the monetary benefit

8 | 8 Long Term Care

9 | 9 Long-Term Care vs. Long-Term Disability? Long-term care insurance - insurance that will help defray the costs of long-term care services – Medicare only covers specified number of days Long-term disability insurance – income replacement, while working, if you are unable to work due to illness or non-occupational injury – Long-term disability insurance does not provide benefits for long-term care services – Goes away at retirement

10 | 11 Cost of LTC Care

11 | 10 If you have Long Term Care do not ever let it lapse!!! – It is getting harder and harder to obtain this coverage – If you are worried about the cost consider lowering the level of coverage but still keep the policy Some pre-retirees/retirees may have saved enough money to “self insure” for these type of services; meaning they have enough money saved to cover these type of services, if needed – This is fine but is that what you really earmarked your money for? If you don’t have LTC insurance and feel you might need LTC (based on your personal health situation/family history) research the USC offering to determine whether you can qualify (there are underwriting requirements) and/or whether you can afford the premium which are age based – Another option is to work with an insurance broker to see whether an individual plan might be the way to go Contact Genworth for an enrollment kit or use their website to enroll – Make sure you are approved and enrolled prior to retirement date

12 | 12 Continuing your USC LTC coverage Simply contact your vendor (John Hancock or Genworth) and arrange to pay the premiums directly. Payments can be made either quarterly or twice a year. Contact information: John Hancock -1-888-524-6167 Genworth – 1-800-416-3624

13 | 13 Need more help? – California Department of Aging’s Health Insurance Counseling and Advocacy Program (HICAP) has developed a consumer guide to long term care which is included in our enrollment package. Additional counseling available from HICAP: 1- 800-927-HELP.

14 | 15 Retirement Plans

15 | 16 Getting your money Defined Contribution Plan - Contact your applicable vendor(s) to discuss your options – You do not have to move your money Be careful of “salesmen” trying to sell you a better vehicle for your money; USC has incredibly low fees whereas another product might not. READ THE FINE PRINT! – Employees hired in 2012 and after may need to satisfy vesting to receive 100% of the university’s matching contribution

16 | 17 The Defined Benefit Plan requires you to select an annuity option at time of retirement. This is an irrevocable election that will lock in your monthly lifetime pension payment. – Straight Life - Payments are made to you, for the remainder of your lifetime. Because there is no survivor benefit, this option yields the greatest monthly benefit. – 10 Year Certain - If you should die within the first 10 years of receiving the benefit, your beneficiary would receive the payments for the remaining years left in the 10 year period

17 | 18 – 50% Spousal Survivor+* - Your monthly benefit is reduced so that your surviving spouse will receive lifetime payments of 50% of your monthly benefit upon your death. – 75% Survivor Annuity* – Your monthly benefit is reduced so that your surviving spouse will receive lifetime payments of 75% of your monthly benefit upon your death. – 100% Spousal Survivor* - Your monthly benefit is reduced so that your surviving spouse will receive lifetime payments of equal value upon your death. *These options are for married participants only. + Surviving spouse benefit if you should die before electing an annuity option

18 | 19 Health Insurance

19 | 20 Under Age 65 Elect COBRA for yourself and your dependents for whichever plan you were enrolled in as an active employee. COBRA may continue for the maximum allowable period (18 or 36 months) or until you reach age 65, whichever comes first. COBRA for dental and vision is available for 18 months only. BUT COBRA may or MAY NOT bridge you to Medicare eligibility (age 65) so plan carefully! Research ACA healthcare options at – May be less expensive especially for younger dependents

20 | 24 IIMPORTANT!!!! If you elect COBRA for yourself (if under 65) and/or a dependent under 65 but subsequently find that one of the ACA plans may be better a better option you cannot voluntarily cancel COBRA to sign up for an ACA plan unless: – You are still within the first 60 days following loss of active employee coverage (the special enrollment period) or – It is the period of marketplace open enrollment If you are not within these two periods you will have to wait until the next marketplace open enrollment period of completion of the 18 months of COBRA whichever comes first

21 | 21 65 or older Enroll in Medicare Parts A, B and D Once enrolled in all parts of Medicare (A, B & D) you must decide if you want to purchase a Medicare supplement insurance or turn over your Medicare for HMO-style coverage

22 | 22 There are many Medicare (Medigap) options, research very carefully! – USC Senior Care is one option Very Important: – Notify all your providers of when Medicare will become your primary insurance and not USC; a mess to clean up after the fact!

23 | 25 Three Months Prior to Retirement Retirement Accounts – Contact your vendor(s) to discuss distribution options – TIAA participants – if you have a Traditional account you must make a decision regarding those funds within 120 days of retirement; other wise your choices will be limited – Once you decision on type of distribution and when to begin you will receive paperwork from your vendor(s) Once you have completed your paperwork, i.e. spousal consent, your signature, deposit instructions, etc., submit to Benefits Office for final authorization, DO NOT SEND BACK TO VENDOR! – We will return to vendor for final processing » We process paperwork within 2-3 business days from receipt, if in good order » If not in good order it could take 1-2 weeks for us to finalize and then whatever the vendors turnaround time is COULD POTENTIALLY BE 3-4 WEEKS BEFORE YOUR DISTRIBUTION BEGINS, PLAN ACCORDINGLY FINANCIALLY Also, we cannot process until you show “retired” in the Payroll system; make sure your department processes your retirement paperwork in a timely manner

24 | 26 Retiree Health Insurance Medicare Eligible Retirees – USC Network participants: Contact Medicare to begin enrollment process for Parts B & D (Part A also if you did not enroll at age 65) – Remember that your USC coverage stops at the end of the month in which you retire Again, notify your doctors that your USC insurance will be ending and Medicare will be primary Begin researching Medigap plans – USC Senior Care is one option

25 | 27 Anthem Blue Cross HMO (CaliforniaCare) – Contact Blue Cross of California directly to enroll in their Senior Secure Plan – Kaiser Permanente – Contact Kaiser directly to enroll in their Senior Advantage Medicare product –

26 Final Steps | 28 Final Steps Faculty – Immediate retirement - notify your department as soon as you know your date – Phased Retirement – contact the Provost’s Office 2 years (3 years max with Provost approval) – We will need copy of letter with Provosts approval stamp or signature Reduce work schedule to 50-99% time – Health benefit eligibility will continue until end of phased retirement period if you are working at least 50% time Give up tenure (at beginning or end of phase period) Retirement funds will be available as an in-service distribution – Must be at least 59 ½ and have given up tenure to access all funds

27 | 29 Staff – Notify your department/school as soon as possible – Common courtesy is 2-3 weeks to allow for replacement strategies

28 | 30 Questions? Contact the HR Service Center 213-821-8100

29 | 31 Disclaimer This summary of USC’s benefit plans has been designed to acquaint you with some of the basic features of the plans, and every attempt has been made to summarize these programs and policies accurately. However, this summary is not designed to serve as your reference for the details of these benefits. Please refer to the Benefits website for more information, including details about limitations of benefits and your legal rights. The actual provisions of each benefit plan will govern if there is any inconsistency between this summary and USC’s formal plans and contracts. This summary does not constitute a contract for any benefit; USC reserves the right to modify or terminate its benefit plans.

30 | 23 Another common questions we get is “What happens if my dependent(s) is not eligible for Medicare?” Spouses: (18 or 36 months) – COBRA (as long as it bridges them to age 65) or – ACA Coverage – Children: – COBRA or – ACA Coverage – – Student Health (if applicable)

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