Did you know that your ASRS benefits can follow you to another employer? There are over 700 employers that are part of the ASRS representing all levels of education, counties, and State service: if you leave one ASRS employer to work for another ASRS employer, your ASRS account picks up exactly where it left off. You don’t lose your current service credit or funds accrued! Having a flexible pension allows you to make career decisions that benefit you without worrying about giving up your future retirement.

One thing to note if you do switch ASRS employers: make sure to re-enroll your myASRS account! Your new employer will give you an enrollment code – re-enrolling helps ensure your contributions with your new employer are properly associated with you and eliminates potential hiccups in your future retirement. 

For a list of ASRS employers, visit: /content/list-employers

Past non-ASRS Service

Have you previously worked in public service outside of Arizona? Or served in the military? ASRS members can actually “buy back” service time for qualified employment types such as having taught outside of Arizona, prior employment with the federal government, or past military service. Even previously-forfeited public service. Purchasing prior service may increase your future monthly retirement benefit or allow you to retire at an earlier date.

If purchasing prior service is something you’re interested in, our online Service Purchase wizard makes the process easy: log into your secure myASRS account and select the Service Purchase option under the “Apply Now” menu and follow the steps to receive a personalized cost estimate for purchasing your past service. And don’t worry, the application process just gathers the information necessary to create your custom estimate - there’s no obligation to purchase once you’ve completed the process.

To learn more about Service Purchase: /content/service-purchase

by Pamela Foust, Strategic Communications

Updated 3/12/2023.

We understand that everyone's financial situation is unique, and you should proceed however is best for your situation. But how do you know “what’s best for me?” Let’s look at some basic information that may help point you in the right direction.

First off, if you plan on leaving your current employer, that doesn't mean you need to refund your retirement account. Hundreds of employers are members of the Arizona State Retirement System, meaning it’s possible to get a job at a new employer and keep building your pension. Also, contribution rates are set by the ASRS, not employers – no matter which employer you work for, if they’re part of the ASRS, the percentage withheld from your paycheck will remain consistent between employers.

If you do end up at a new employer who isn’t part of the ASRS? You still don’t need to refund your account if you don't want to - it’s completely up to you. Generally, this decision is based upon a combination of your age and years of service with the ASRS. For example, if you’re age 50 with at least five years of service, you may decide to take a reduced early retirement. (To get a better picture of where you stand, you can log into your secure myASRS where you can estimate retirement options and refund amounts.)

Alternatively, you may decide to leave your money with the ASRS. What are the benefits of leaving your money with the ASRS if you’re no longer able to contribute to it? For starters, you could still receive a monthly lifetime pension when you hit retirement age. Also, it would mean you would still be eligible for health insurance coverage through the ASRS when you retire, and perhaps a premium benefit that would help lower monthly health insurance costs.

The most important thing, should you decide to request a refund of your account, is that you have a clear understanding of your options and any related implications. Some things to be aware of;

- Taxes may be withheld from your refund, depending on how you decide to receive the funds.

-You may need to report your refund as income on your tax return and pay additional required income taxes.

- If you rejoin or start contributing to the ASRS again after you've refunded your account, your retirement service credit will reset to zero, and you will forfeit any previously earned service credit. This also means not being grandfathered into any rule changes that may have occurred since you initially joined.

We sometimes see teachers requesting refunds at the end of each school year as a way to receive money for the summer. This may result in surprises later in their career, such as reaching retirement age but not meeting eligible criteria due to a lack of accrued service credit. 

So, if you’re asking yourself, “Should I refund my account?” make sure to do your due diligence. Visit the Refund page of AzASRS.gov for additional information, analyze the information in your secure myASRS account, and if questions still remain, contact us - our trained staff is here to help guide you to the best decision for your future.

It’s Retirement Season: Make Sure You’re Ready

A comment we’ve frequently heard from our members when they are ready to begin the retirement process is that they wish they’d known more and started preparing sooner. Don’t let that be you! Whether it’s three years down the road, or six months, there are steps to take right now to make sure you’re ready for your retirement.

Three Years Before Retirement

As you start to think about what your retirement looks like and when you might want to retire, we encourage you to take our Annuity Options eLearning. This interactive, self-paced course is available on our website and will introduce you to the various annuity options available to you at retirement.

Once you’ve thought about what kind of annuity option best suits your needs, register for the member education, Route 3: Destination in Sight. This program is available both online as well as group sessions offered in Phoenix. Route 3 provides essential information to help you determine if you are ready to retire and what steps you need to take to be prepared.

12 Months Before Retirement

As your retirement date gets closer it’s a good time to find out about your health insurance options by signing up for Know Your Insurance. This program is available in a live, streaming option or in group meetings in Phoenix. You’ll learn about the medical and dental options available to ASRS retirees, the premium benefit, how medical and dental costs are calculated, and more.

Six Months Before Retirement

With your retirement now just a few months away, it’s time to finalize your retirement choices by registering for Route 4: Next Exit – Retirement! We’ll walk you through how to apply for retirement, how to select your pension and health insurance options, and returning to work after retirement if that is part of your plan. Attendees will receive a customized benefit estimate and learn how to retire using our online application.

Get Started Now!

The ASRS Member Education calendar is continuously being updated. To find times, dates and locations for these and other meetings, please visit Member Education. When you are ready to register, please log into your myASRS account page. Haven’t registered yet or forgotten your password? No problem! Simply click the First Time Registering link or Having Trouble Logging In from the myASRS login page to get started.

Written by Pamela Foust, Strategic Communications

Published in the April 2018 digital newsletter "Expanding Your Financial Horizons"

The process of retiring can be intimidating. We understand!  That is why we offer an array of online information and webinars, as well as group meetings.

Browse Our Website

Without a doubt, the website is the best starting point to any question you may have about retiring. Have you ever explored the “Retirement Central” area of AzASRS.gov? Whether you’d like to estimate your future benefits, figure out your options regarding beneficiaries, or wonder if you can afford to retire – our website has you covered! Click Here to visit Retirement Central.

Attend a Group Meeting

Whether you’re 3 years away from retirement, or within 6 months, we have a class for you. Offered both online and onsite, in Phoenix and in Tucson, our training staff puts together courses designed to cover the most common questions people have as they near retirement. Click Here to find the class or webinar that best suits you.

One-on-One Counseling

Did you know the ASRS provides remote one-on-one counseling? You can now interact with an ASRS Retirement Specialist via the internet so you don’t have to drive to an ASRS office! A counseling session does require registration through your secure MyASRS account – further instructions can be found here, on our website.

If you go through the above channels and still find yourself uncomfortable filing for retirement, by all means, make an appointment for a 30-minute in-person meeting with one of our Retirement Specialists.  But please keep in mind a couple of key points; 

• • Members who visit an office without an appointment are unlikely to be able to see a Retirement Specialist that day. It’s not uncommon for appointments to be fully booked 2-3 weeks out. Just like a doctor’s office, we understand the need for help but are often unable to accommodate walk-ins due to being fully booked.
  • Please remember that you won’t be able to file for retirement during your appointment. We’ll make sure to answer all your questions, after which you’ll need to file for retirement online via your secure myASRS account.

No matter how you prefer to find your answers – through our website, a group meeting, remote counseling, or a one-on-one appointment – it’s our continuing goal to make the process as comfortable and convenient as possible. We hope that this information helps point you in the right direction should you have any questions along the way.

Written by Nathaniel Brengle, Strategic Communications

Published in the April 2018 digital newsletter "Expanding Your Financial Horizons"

This year, the ASRS will celebrate its 65th Anniversary.

In the 21^st session of the Arizona State Legislature, Governor Howard Pyle signed the bill that created the ASRS as of July 1^st, 1953 as a pension plan for employees of state and municipal government.

The first public pension in Arizona, however, was issued in 1912, the year Arizona entered statehood. It was granted to a teacher, in the amount of $50 a month ($600 a year). In 1955, the teacher’s pension plan and the ASRS merged, creating a statewide retirement system.

According to the very first ASRS Annual Report, when the ASRS was created it had a starting membership of 5,209. That year, a total of 135 workers retired, split among 106 men and 29 women.  The average age at retirement that year was 72, and the pension amounts ranged from just over $700 to a little over $1,000 – a year.

In 1971, the ASRS replaced its defined contribution ‘system,’ with the defined benefit plan that is in place today, and also adding retiree health insurance and long term disability programs in the late 1980’s. 

65 years later, the ASRS has more than a half-million members, including nearly 150,000 retirees receiving a lifetime monthly benefit, which, by the way, now averages about $20,000 a year. While it’s interesting to look back at historical numbers like these, it is important to recognize that the mission of the ASRS hasn’t really changed.

Today, as in 1953, the ASRS remains committed providing Arizona’s educators and employees of state and municipal governments with a secure retirement income stream for their lifetime.

We have come a long way since that first year – when the fund totaled about $6 million.  Today, the ASRS manages a trust fund of more than $40 billion. We are proud of our past, and look forward to the next 65 years with a continued focus on serving our members.

Written by Dave Cannella, Media Relations

Published in the April 2018 digital newsletter "Expanding Your Financial Horizons"

By Kim Beck, ASRS Retirement Specialist, Tucson office

Everyone looks forward to payday, right? You know it will happen every two weeks and you count on that, like clockwork. But what happens when you retire? 

We strive to process retirement applications as quickly as we can – the ASRS processes about 8,600 applications a year. The busiest months are March, April, and May when there’s generally a surge in retirement applications from teachers.

The good news for most members, as their retirement date arrives, is that the ASRS provides monthly income while the retirement benefit is completely processed. This advance of retirement pay, known as an “estimate check,” will most often be received within 10 days or less of your retirement date. If necessary, while the application is being processed, a member can receive up to three estimate checks, ensuring a steady income stream throughout the process.

It can take up to 90 days to completely process a retirement application and arrive at the final lifetime monthly benefit. That’s often due to lagging contributions coming in from the employer or processing of service purchase options.

This final calculation is dependent on the receipt of a required Ending Payroll Verification form from each of the member’s ASRS employers within the last three years before the retirement date. On the retirement date, the electronic form is sent by the ASRS to the employer who then sends it back within 10 business days. Delays rarely occur with this form, but if it isn’t received on time, the ASRS will remind the member to work with his/her employer(s) on expediting the form to the ASRS. This is how the ASRS identifies that the contributions have stopped, which allows for finalizing the member’s service and salary – the two primary factors used in determining the final pension amount.

Sometimes complex pension calculations can cause delays in processing. This is why estimate checks are so helpful to our members. After that first estimate check within 10 business days, the second or third checks, if applicable, are issued within 10 business days of the first of the month.

Exceptions to receiving an estimate check include:

• • A legal hold, most commonly due to a divorce

  • A member’s age - someone who is younger than 50 or older than 70½ who may have unique tax consequences
  • Re-retirement
  • Lump-sum retirement

Once the final retirement benefit is calculated and processed, retirees will receive a monthly payment for the rest of their life. Most people may be used to getting two paychecks a month during their careers. Adjusting your budgeting to receiving one monthly payment from the ASRS is important for retirees to ensure steady payment of debts such as the mortgage, insurance, or other household bills.

ASRS pension payment will arrive on the first of each month and a list of monthly direct deposit dates is posted on the ASRS website. Using direct deposit into a checking or savings account is the safest, most convenient way to receive your payment.  A list of monthly direct deposit dates is posted on our website. Retirees can also access their direct deposit summary statements each month in their secure myASRS account.

Also noteworthy is that the only usual deductions from the payment to consider will be taxes based on personal withholding choices and if selected, ASRS group health insurance premiums.  

Everyone looks forward to a secure, comfortable retirement, and now because we're living longer, healthier lives, that means more reasons to plan. Getting paid doesn’t have to be a mystery and can remain one of the joys of working life, even in retirement.

To learn more, including direct deposit dates, see Benefit Payments.

RETIREMENT CENTRAL

For complete information on retirement, including our online retirement application, be sure to visit Retirement Central. 

This article appeared in "Expanding Your Financial Horizons" (Q2-2016), a digital publication of the ASRS.

One of most frequently asked questions received by the Member Advisory Center is “Can I take a loan out of my retirement?”

The answer, in a word, is "no”. Neither actively contributing members or inactive members with an account on file are permitted to take a loan from their account. The ASRS does not permit members to take loans from their account because it is not authorized in state statute. Absent authorizing legislation, the ASRS cannot permit members to borrow from their account. Inactive members may withdraw their funds and terminate membership. Active members may have access to loans from other types of retirement savings, such as a 401(k) or voluntary deferred compensation plans, such as those offered through the ASRS supplemental savings plans.

While these are your contributions, and you do have a right to them, there are only two times members can access to their funds. First, if you retire and take a monthly benefit or, if eligible, a lump sum retirement payment. Second, if you request a refund of contributions after terminating employment with any ASRS employer.

The next most frequently asked question is, “So, what if I terminate employment? Can I take a portion of it and leave some in ASRS?” Again, the answer is "no". You can either withdraw all of your contributions and terminate membership, or leave all your monies on account and retain your membership rights as an inactive member with access to future benefits.

If you do choose to terminate employment and withdraw your funds, you have three distribution options: 100% direct payment to yourself; 100% rollover into another qualified retirement plan; or a combination direct payment and rollover.

It is very important, even in difficult economic times, to give serious consideration when withdrawing your funds - especially if you have not reached retirement eligibility. Keep in mind that when you withdraw your contributions, you cancel your years of service in the ASRS and forfeit your rights to a future retirement benefit. Depending on your years of service, it may be a small benefit paid in a one-time lump sum, but as an ASRS retiree, you retain your rights to enroll in the ASRS’ retiree group health insurance, another valuable benefit to consider.

Learn more about Refunding Your Account and Terminating Membership.

Learn more about Retirement Eligibility.

HAVE A QUESTION WE CAN ANSWER?

Send us an email at [email protected]. 

This article appeared in "Expanding Your Financial Horizons" (Q2-2016), a digital publication of the ASRS.