Getting ready for retirement

Pension Benefits Report 

A law enforcement officer’s career is a marathon, not a sprint. You have most certainly encountered peaks and valleys throughout your career. If you are like most, you often ponder what your life at the end of the rainbow holds. If you are about to complete or have completed 25 years of service and are contemplating or planning for retirement, then this article will give you an overview of what to expect when you “push the button” for a Special Retirement.

A Special Retirement is available to Tier 1 members at any age who have at least 25 years of service credit in the Police and Fire Retirement System (PFRS). You will receive 65 percent of your final compensation (last 12 months of service) plus one percent for each year of creditable service or 1/12th percent for each month of creditable service over 25 years, but not to exceed 30 years. The maximum allowance is 70 percent of your final compensation.

I would suggest that you start researching the benefits that are available to you in retirement approximately six months prior to retirement, obtain a retirement estimate on MBOS (Member Benefits Online System) and complete your retirement application three to four months prior to your selected retirement date. Separation of services occurs on the last day of the month for the retirement estimate, and all retirements must be on the first day of the month.

You must complete the retirement application on MBOS and be sure to change your email to a personal address, provide proof of age and update your beneficiary. Both you and your employer will receive notification of your retirement within 24 hours, and any retirement date change must be approved by your employer.

Approximately one to two months prior to your retirement date, you will receive a letter from the State Health Benefits Program (SHBP) offering you enrollment in that program and you will utilize the “Benefits Solver” tab on MBOS to obtain those benefits. Health benefits are strictly contractual, and you will utilize the Benefits Solver only if you are in the SHBP or Chapter 330. Next, you will receive a quotation of eetirement benefits after your employer certifies your salary, service and that you are not under any disciplinary charges. You cannot retire if you are facing disciplinary charges or are under investigation for them.

Around the date of your retirement, you will receive a letter from the PFRS Board of Trustees approving your retirement. You will receive new medical, dental and prescription cards if you enroll in the SHBP. Your Federal Withholding Form (W-4P) and State Withholding Form (W-4P) will arrive. Immediately return the Federal Withholding form to Pensions. Keep the State Withholding form with your tax documents and do not file it with pensions, as you do not pay NJ income tax until you recover your contributions to PFRS.

You will receive a direct deposit form, as your pension check will be directly deposited to your bank account on the first of each month and you will receive a copy of your statement of allowance, which is a certification of your yearly earnings.

The premise behind planning early for retirement is to make it a seamless process. You will continue to receive a paycheck from your employer leading up to your date of retirement, and your health care benefits from your employer will continue for the month following your retirement. On the first of the month following your retirement date, you will receive your first pension check and transition to your retiree health benefits.

Congratulations on your milestone if you are retiring, and feel free to call or email me with any questions regarding your pensions and benefits.