Your Retirement: Questions and Answers
This Q&A addresses changes to the Vermont State Teachers’ Retirement System and the most pressing concerns of our members about these changes.
There are several aspects of the retirement system, big and small, that will not change—e.g., the number of retirement options, the health insurance plans offered, eligibility for early retirement and disability benefits, cost of living adjustments, etc.—so they are mentioned only in passing or not at all.
Further, this Q&A structures responses to teachers’ questions primarily based on years of service and age. All the proposed changes do not apply uniformly to all teachers. For example, under the proposed changes there will be two sets of criteria for determining normal retirement age—that is, when you can retire and draw a full pension without penalty. Generally speaking, one size does not fit all, except in respect to certain key provisions, like the annual contribution rate and years required to vest for a pension (See Table 1).
Please read carefully and make sure you are consulting the right information and tables based on your years of experience and age as of June 30 or July 1, 2010.
Finally, we strongly recommend that your review the retirement terms and definitions we have provided.
General Questions and Answers
The Status of the Proposed Changes,
Purchasing Air Time and Service Credit, How to Contact VSTRS & Universal Features of VSTRS in the Future
The Status of the Proposed Changes,
Purchasing Air Time and Service Credit, How to Contact VSTRS & Universal Features of VSTRS in the Future
Q: When do the retirement changes go into effect?
A: July 1, 2010.
Q: If I turn 57 on or later than July 1, and have 5 or more years to teach before reaching 30 years of service as of June 30, 2010, am I subject to the rule of 90/age 65 change?
A: Yes.
Q: Will it still be possible to purchase “air time” after 25 years of service—“air time” is service time, up to five years, a teacher did not actually work—and service credit (out-of-state teaching, military service, Peace Corps/VISTA, etc.)?
A: Yes.
Q: Can I buy service credit to be exempted from the rule of 90/age 65 rule? For example, let’s say I have 24 years of service as of June 30, 2010, and I want to “buy” year 25 so that I am within five years of 30 years of teaching as of July 1. Is this possible, and will that purchased year be counted as creditable service as of June 30?
A: Yes; and the purchase will be credited this year if you buy the time before July 1.
Q: Can I purchase multiple years.
A: Yes (if you eligible to do so, of course).
Q: Can I “buy” years to purchase the new spousal health care coverage?
A: No. However, if you “buy” years, in full, before July 1, 2010,you can shorten the amount of time you have to work to qualify for this benefit. For example, teachers with 25 to 29 years of service as of June 30, have to work to year 35 to be eligible for spousal insurance coverage. If they “buy” years by June 30, 2010, they can shorten that time frame. For example, a teacher with 26 years as of June 30, who buys 4 years of air time, let’s say, will be credited with 30 years as of July 1, and, thus, have only five more years to teach to be eligible for spousal coverage, rather than nine years if he or she had not purchased these years.
Q: How do I contact the Vermont State Teachers’ System if I have specific questions about my service credit and retirement options?
A: Call 1-800-642-3191 or 802-828-2305.
Q: What features of the new system will apply to ALL teachers, including new hires, no matter their age or years of service?
A: Pension eligibility (vesting), the pension calculation formula, early retirement eligibility and the employee’s percentage of annual contribution. See Table 1.