JR2007 said:
Need to do this with my wife's. There shouldn't a penalty for rolling over, just note you'd incur taxes rolling into a Roth vs a 401k.
Been dreading do it because I suspect they'll make the process more difficult than necessary. I'll hang up and listen for others who've done it.
Keep us posted here, would like to learn from your experience.Milwaukees Best Light said:JR2007 said:
Need to do this with my wife's. There shouldn't a penalty for rolling over, just note you'd incur taxes rolling into a Roth vs a 401k.
Been dreading do it because I suspect they'll make the process more difficult than necessary. I'll hang up and listen for others who've done it.
They make it incredibly difficult. To roll it over to a different institution you have to fax them a notarized form, then they snail mail you another form. I don't know what to do with the other form cause I am still waiting to receive it. 9 weeks and counting. I will start calling and bothering someone when I get back from spring break.
South Platte said:
Depending on how many years of service a person has in TRS and how close they are to retirement, leaving the funds in TRS and waiting for the pension to kick in could also be a solid strategy. My service will be worth about $25,000 a year, if no adjustments to the payout occur.
Once you pull funds out of your TRS, your service earned is gone. If you return to a TRS employer you start at 0 years of service.
Aggwife said:
44, but I haven't contributed to TRS in over 12 years so my years of service aren't much. I should've rolled these funds over a long time ago.
Also, I plan to take 50% of my husband's SS which will be higher than any pension I get with TRS, so the age/service is a moot point, right? Please correct me if I'm wrong.
My wife left teaching after 7 or so years when we had our first child. I don't remember why but we took the balance out when she quit and I probably bought hunting and fishing stuff with it. Was like $7,000 or so and an amount that small didn't result in much of a tax hit. She was a stay at home mom until our third child started 1st grade, then she went back to teaching. A couple of years before she retired we got a letter from TRS that discussed a pending increase in the cost to buy back prior years of service. We bought back those 7 years for something like $29,000. Not only did that mean she could retire around 3 years earlier, it nearly doubled her monthly pension.South Platte said:
Depending on how many years of service a person has in TRS and how close they are to retirement, leaving the funds in TRS and waiting for the pension to kick in could also be a solid strategy. My service will be worth about $25,000 a year, if no adjustments to the payout occur.
Once you pull funds out of your TRS, your service earned is gone. If you return to a TRS employer you start at 0 years of service.
Right. I just wanted to make sure people saw both sides. For example, my cash balance is $80,000 after 11 years of service. If I rolled that into an investment account when I turn 65 it would be worth about $250,000 or so. But if my health is good, and I get paid $25,000 each year from 65 to 85 and die at 85, that's worth $500,000 in gross distributions. Plus, I get 1/2 of my Medicare premium covered because I got to 10 years of service.one safe place said:My wife left teaching after 7 or so years when we had our first child. I don't remember why but we took the balance out when she quit and I probably bought hunting and fishing stuff with it. Was like $7,000 or so and an amount that small didn't result in much of a tax hit. She was a stay at home mom until our third child started 1st grade, then she went back to teaching. A couple of years before she retired we got a letter from TRS that discussed a pending increase in the cost to buy back prior years of service. We bought back those 7 years for something like $29,000. Not only did that mean she could retire around 3 years earlier, it nearly doubled her monthly pension.South Platte said:
Depending on how many years of service a person has in TRS and how close they are to retirement, leaving the funds in TRS and waiting for the pension to kick in could also be a solid strategy. My service will be worth about $25,000 a year, if no adjustments to the payout occur.
Once you pull funds out of your TRS, your service earned is gone. If you return to a TRS employer you start at 0 years of service.
I'm 50. My annual gross pension will be $25,000 starting at 65 if I leave the money in TRS, plus at least $100/month toward Medicare premium. Also, I might return to a TRS job someday, who knows.JR2007 said:
Is that $25,000 per year if you stayed or left TRS?
Also not sure your age, but $80,000 for a 35 year old invested for 30 years at 8% return is more like $800,000.
After being in CO for a few years, I pulled out my wife's 7 years of TRS in 2015 with no penalties. We rolled in to a fidelity IRA along with ~3 years of a sports authority 401k.. I bought a bunch of stock (cost, aapl, nflx and a few mutual funds) and that $50k has gone 6X since then.Aggwife said:
I am not teaching anymore and do not plan to return. I understand that if I pull all of it out there is a 20% penalty; however, I am unsure of what happens if I roll it all into a Roth IRA. Do I pay a 10% penalty or is that only if I turn around and pull it out of the IRA?
Any help is appreciated!
Jack Pearson said:
My sister took a break from teaching this year. She has 20 years of service and ~110k in TRS that she wasnt planning on moving but something to think about. She did roll over her 457 to a IRA and Roth IRA as the company the district was using for management was taking out $200 a month in fees.
I ran the cacl and the full TRS starting in 2040 which is 15 years from now would be about 3k a month. So 36k a year until death vs putting into the market now.investorAg83 said:Jack Pearson said:
My sister took a break from teaching this year. She has 20 years of service and ~110k in TRS that she wasnt planning on moving but something to think about. She did roll over her 457 to a IRA and Roth IRA as the company the district was using for management was taking out $200 a month in fees.
Do the calc before moving it out…
Jack Pearson said:I ran the cacl and the full TRS starting in 2040 which is 15 years from now would be about 3k a month. So 36k a year until death vs putting into the market now.investorAg83 said:Jack Pearson said:
My sister took a break from teaching this year. She has 20 years of service and ~110k in TRS that she wasnt planning on moving but something to think about. She did roll over her 457 to a IRA and Roth IRA as the company the district was using for management was taking out $200 a month in fees.
Do the calc before moving it out…
She is 45 with 20 years of service. To get to 80 point she would have to wait 15 years vs moving the 110k into an IRA and then an total stock market index fund. I find it hard to believe she wont come ahead with pulling and putting into the market?
which is why it's common to see a teacher do something else for 3 years that has a higher pay shortly before retirement.gvine07 said:
To my knowledge, TRS averages a person's highest 36-month earnings for monthly payout calculations.
it's been a while since I looked, but I thought it was a factor of age and years of serviceYour Mom And Them said:
TRS formula is number of years of experience multiplied by 2.3. That provides the percentage of the average of five highest years of earnings for your pension.
EX:
30 years experience x 2.3= 69
Average of five highest years= $70,000
$70,000 x 69%= $48,300 per year of TRS pension
Years + Service credits is what qualifies you for the benefits. This is where rule of 80 comes into play. Once you reach, then you are eligible for full benefits from TRS.62strat said:it's been a while since I looked, but I thought it was a factor of age and years of serviceYour Mom And Them said:
TRS formula is number of years of experience multiplied by 2.3. That provides the percentage of the average of five highest years of earnings for your pension.
EX:
30 years experience x 2.3= 69
Average of five highest years= $70,000
$70,000 x 69%= $48,300 per year of TRS pension
and if it's anything like PERA, they change the chart every handful of years, so you have know what chart you are on.
JFC!!!Jack Pearson said:
My sister took a break from teaching this year. She has 20 years of service and ~110k in TRS that she wasnt planning on moving but something to think about. She did roll over her 457 to a IRA and Roth IRA as the company the district was using for management was taking out $200 a month in fees.
Aggie Planner said:Years + Service credits is what qualifies you for the benefits. This is where rule of 80 comes into play. Once you reach, then you are eligible for full benefits from TRS.62strat said:it's been a while since I looked, but I thought it was a factor of age and years of serviceYour Mom And Them said:
TRS formula is number of years of experience multiplied by 2.3. That provides the percentage of the average of five highest years of earnings for your pension.
EX:
30 years experience x 2.3= 69
Average of five highest years= $70,000
$70,000 x 69%= $48,300 per year of TRS pension
and if it's anything like PERA, they change the chart every handful of years, so you have know what chart you are on.
Once you are eligible for full benefits, that is when the formula above comes into play.