What to Know About Filing for Retirement

By Judith Bruner
UTLA Compensation and
Benefits Specialist

Planning to retire? It is important to understand the steps you need to take for a smooth transition.
Set up a STRS appointment: Essential to beginning this process is a phone call to the STRS Regional Counseling Center to make an appointment for an interview. Call (800) 228-5453 and press option #3. STRS also has a website at www.calstrs.com. In addition, you may wish to contact a local office of the Social Security Administration (800-772-1213) to determine if you might be eligible for benefits as a result of non-teacher employment for you or your spouse. Make sure that you mention you will be receiving a California State Teachers Retirement pension, as there is a government pension offset against any Social Security benefits for which you may be eligible.

Know the legislative improvements to benefits: Benefit enhancements that began in 2000 reflect goals to recruit new teachers and reward career teachers. Some enhancements that began that year include a monthly longevity bonus for those who retire after January 1, 2001, and earn 30 or more years of service credit by January 1, 2011. It breaks down into $200 for 30 years’ service; $300 for 31; and $400 for 32+.  Those with 25 or more years of service credit will be able to use the single highest period of 12 consecutive months of compensation to calculate benefits. Those with fewer than 25 years will still use the average of the highest 36 months of compensation to calculate benefits.

An important enhancement beginning July 1, 2002, was the expansion of creditable compensation. As a member of CalSTRS, you earn service credit on, and you and the District pay contributions on, your compensation from that service. AB 2700 expanded the definition of what can be counted as creditable compensation and service to include income from working summer school and intersession, department chair stipends, allowances, and pay-for-performance bonuses. Service in and compensation from these activities will be credited to a new Defined Benefit Supplement Account created by AB 1509. The new Defined Benefit Supplement Account became effective January 1, 2001 (and extends through 2010). Currently one-quarter of your monthly CalSTRS contribution is deposited in this account without any change in the eight percent retirement contribution withheld from your paycheck or in your retirement allowance. This provision ceases at the end of 2010, but contributions from your expanded creditable compensation and service will continue to be deposited in the supplement account. A CalSTRS member may not earn more than one year of service credit in the Defined Benefit Plan even with the new expanded contributions. Contributions from service in excess of one year roll over into the Supplement Account.

Follow the retirement checklist: Assuming you’re retiring in June, here is a list of things to do:
Contact LAUSD Certificated Placement Unit at (213) 241-5100 to request a retirement packet. This is very important, because the LAUSD packet contains both District resignation and health benefits continuation forms.
Follow the directions in the packet to mail completed forms no earlier than six months prior to retirement and no later than the last day of the month in which your retirement is to become effective. It is best to mail the application by certified mail; that way you know it has been received. CalSTRS forms go to CalSTRS in Sacramento, not to LAUSD.
If you wish direct deposit of your STRS allowance, fill out the form that comes with the packet and include it with your application.
Complete the beneficiary designation (always keep current on this item) with the application.
Obtain necessary documents such as verification of Option Beneficiary’s birth date.
After you have submitted completed paperwork, STRS will mail you an award letter detailing your monthly estimated allowance and issue your first allowance check no later than 45 days after retirement, and often sooner. STRS will send you adjustment letter(s) over a period of months if it receives additional information affecting your allowance, such as additional service credit due to accumulated unused full-pay sick leave.
For information about continued medical/dental/vision coverage, contact LAUSD Insurance Services at (213) 241-4262. Be aware that certificated  employees must meet service requirements for LAUSD to pay premiums. Refer to Article XVI, Health and Welfare, Section 4.0 of the Collective Bargaining Agreement for information on the service requirements. Enrollment in Medicare Part B (physician benefit) is required by the Collective Bargaining Agreement when a retiree or covered spouse reaches age 65.

Think twice about midyear retirement: I do not recommend a midyear retirement. Resignations and/or retirements prior to the end of the contract year result in a change of pay basis. LAUSD will go back to the beginning of the school year (that is, July 1) and change your pay basis from annualized to non-annualized and take back all the filler time previously paid. This usually results in the retiree being overpaid. The District will deduct the salary overpayment from your retirement bonus.

Join UTLA-Retired: Retiring UTLA members are encouraged to join UTLA-Retired to keep abreast of developments in areas of interest to you. Contact the UTLA Membership Department at (213) 368-6241 to request information and an application.