Planning for Retirement
Retirement is a major event in most people’s lives. It ushers them from the obligations of the workplace to the self-direction of retired living. As you prepare for your KCERA retirement, here is a suggested timeline to assist in your planning.
3-5 Years Before Retirement
- Watch the KCERA Retirement Planning Seminar or attend a KCERA seminar.
- Identify a potential retirement date. Some members choose to retire after a birthday to gain a higher age factor or by April 1 to qualify for that year’s cost-of-living adjustment.
- Contact a retirement services representative to obtain a benefit estimate, or use the Online Benefit Estimator to calculate your own estimate.
- Increase your years of retirement service by purchasing service credit. You may be eligible to pay with personal check, payroll deduction, retirement account rollover and/or salary advance.
6-12 Months Before Retirement
- Select your retirement date. Here are a few things to consider about the timing of your retirement:
- You may want to retire on or before April 1 so that you are eligible to receive the cost-of-living adjustment that is payable in April.
- You will only receive retirement service credit for a pay period that you complete, so you may want to retire on the first day of a new biweekly.
- The “age factor” used to calculate your pension increases every three months until you are age 60 for General Tier I members, age 65 for General Tier II members, age 50 for Safety Tier I members and age 55 for Safety Tier II members. You may want to retire after your birthday or a subsequent quarter year.
- You must work a whole year at a higher salary in order for it to be fully included in your final average compensation (FAC). The FAC of members subject to PEPRA rules is determined based on a three-year period.
- Obtain an updated benefit estimate from a retirement services representative or the Online Benefit Estimator.
- If you were married during your career but later divorced or legally separated, your ex-spouse may have a “community property interest” in your KCERA benefit. If so, please provide KCERA with a copy of your Judgment, Joinder and court-approved Domestic Relations Order (DRO). KCERA cannot issue your first retirement payment until these documents are on file.
- Contact your department to discuss unused sick leave and vacation hours. At retirement, unused sick leave can be paid in a lump sum or rolled over to Deferred Compensation. Unused vacation can be paid in a lump sum, rolled over to Deferred Compensation or applied toward “terminal vacation,” a program that lets you run out your final weeks of employment as vacation.
- Contact your employer’s Health Benefits Division to obtain information about retiree health benefits. If you plan to purchase health insurance through your employer, you have a limited time to enroll after retiring.
- If you are reciprocal to another retirement system in California, you must retire from both systems on the same day. If you do not, all reciprocal benefits will be forfeited.
2 Months Before Retirement
- Contact a retirement services representative to discuss the advantages and disadvantages of the five retirement options and the Temporary Annuity Option. Your election is final after your first benefit payment is issued, so choose carefully based on your financial needs and goals.
- Complete KCERA’s retirement application packet. Be sure to follow the instructions on the forms, and return them to KCERA within 60 days of your retirement date. (If you are planning to take terminal vacation, you may submit the forms when your vacation begins.) Please include all requested documentation, such as copies of your marriage certificate and driver’s license.
1 Month Before Retirement