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Postretirement Increases |
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As a MIP retiree, you can look forward to a 3 percent increase beginning the second October after your retirement effective date. For example, if your retirement effective date is December 1, 2008, your first increase will be in October 2010.
Your postretirement increase doesn't compound, but it does accumulate. So if your first postretirement increase is $36 per month, every October you can expect to get $36 more per month than you did the previous year.
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Example of Postretirement Increase (MIP)
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Mary Jo retired on December 1, 2009, with a monthly pension payment of $1,200. Beginning October 2011 (the first October after she's been retired a full year) she'll begin receiving an additional 3 percent of her initial pension, or $36 a month.
- The first October, Mary Jo will receive $1,236 ($1,200 + $36).
- The next October, Mary Jo will receive $1,272 ($1,200 + $36 + $36).
- The third October, Mary Jo will receive $1,308 ($1,200 + $36 + $36 + 36).
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Increases for MIP members.
The increase is based on your initial pension amount after applying any early reduced or survivor option reduction. If you choose one of the equated options, the advance portion of your pension is not included when the 3 percent is calculated.
Note: If you chose the 100 percent survivor option, your beneficiary will receive the same annual increase you received. If you chose the 75 percent or 50 percent survivor option, your beneficiary will receive either 75 percent or 50 percent of the annual increase you received.
Increases for Basic Plan members.
If you're a Basic Plan member, you should not plan on a scheduled postretirement increase. However, in years when the plan's investments exceed predictions over a period of years, you may receive a distribution of the excess earnings. You'll be notified if and when a supplemental payment, sometimes called a 13th check, will be issued.
Wage adjustments after you retire.
If your school contract is under negotiation when you retire, you might have a wage adjustment after your pension begins. Once your school reports the correction, we will correct your final average compensation and pension amount. You'll be paid all past due benefits.
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