Transcript Slide 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
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Life
Insurance
Should 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
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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
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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
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Accidental Death &
Dismemberment (AD&D)
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
• www.LifeBenefits.com/travel 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
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Long Term Care
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
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Cost of LTC Care
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• 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
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
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• 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: 1800-927-HELP.
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Retirement
Plans
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
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• 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
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– 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
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Health
Insurance
Under Age 65
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• 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 www.healthcare.gov
– May be less expensive especially for younger
dependents
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
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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
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• 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!
Three Months Prior to Retirement
•
•
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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
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
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• Anthem Blue Cross HMO (CaliforniaCare)
– Contact Blue Cross of California directly to enroll
in their Senior Secure Plan
– www.bluecrossca.com
• Kaiser Permanente
– Contact Kaiser directly to enroll in their Senior
Advantage Medicare product
– www.kp.org
Final Steps
Final Steps
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• 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
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• Staff
– Notify your department/school as soon as
possible
– Common courtesy is 2-3 weeks to allow for
replacement strategies
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Questions?
Contact the HR Service Center
213-821-8100
[email protected]
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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.
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• 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 – www.healthcare.gov
• Children:
– COBRA or
– ACA Coverage – www.healthcare.gov
– Student Health (if applicable)