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At EFS, we believe that the only way to reach your retirement destination is to have a road map.

When you talk to your Teacher’s Retirement System or the Social Security System, THEY ARE NOT ALLOWED TO DISPENSE FINANCIAL and/or TAX ADVICE. They specifically notate this and may simply read you the options and explain what they mean. THIS IS NOT FINANCIAL PLANNING.

Individual financial advice = your road map to a secure financial future. To survive, you need this!

No two financial plans are alike. Specific calculations are completed for each individual/couple. We compare your projected ATRS, TRS or TSRL and retirement investments with your projected retirement needs and then, based on these comparisons, provide recommendations that will allow you to strengthen your economic health. We would be pleased to provide this personal financial advice at anytime and the first appointment, as always, at no cost.

Feel free to give us a call or email; we want to help advise you. Our Houston Main Office number for Jay Allen Finn, CPA is (800) 950-1829 and Tim Webster’s Northeast Texas office is (800) 285-8803. If you live in other areas; we will direct you to the right individual representative when you contact us.

The following applies mostly to the Texas TRS but TRSL & ATRS have similarities.

The DROP program, introduced several years ago, has neared completion for most educators who elected it before the reduction of the .79 multiplier to .60. Therefore most of you should no longer be in DROP or should be choosing the PLSO instead.

1. Most retirees will find that a small amount of their Partial Lump Sum (PLSO) is non-taxable when retiring and their monthly pensions are also approximately 4% (case by case) non-taxable.

2. TRS often times comes out better by you not taking the PLSO. TRS would rather keep the money, pay you monthly, and then at the end of your life, keep this lump sum.

3. This benefit was bestowed by the legislature and should be seriously considered by every retiring educator. Additionally, if you are taking this great benefit, it makes little sense to take the 12 or 24 month rather than the 36 month maximum.

4. Most importantly, this is your money and it can outlive you and your beneficiaries. With wise investing, you can withdraw about what TRS pays, at “your option” and have this windfall in larger payments for you in the sunset years of your life. Even a conservative investment model will show you that you will not cut your principal much, if any, over the first thirty-five years of your retirement.

“Employment after Retirement” is probably more common for people who wait one year or who waited one month and then got rehired by January, 2005. One new interesting way to rehire, get all 12 TRS checks and secure a contract commitment is for you to be willing to be an independent contractor. There are some tax ramifications inherent in this scenario and you should seek the advice of your tax advisor or Jay Allen Finn, CPA.

Exploring retire/rehire in today’s environment is another reason to get that financial plan today.

As most of you know the "One Day Loophole" is now history. Under HR 743 (Congressional bill) it was replaced with a “Five Year Loophole” or really a requirement that the last five years of employment prior to retirement must be under both systems.

Currently there are about 15 Districts who fully participate in Social Security and TRS (see www.atpe.org/eduIss) for the list.

The Government Pension Offset (GPO) only affects spousal benefits for school employees who do not pay into Social Security and retire under the TRS system. For further information, see our Social security page.

Also remember: Social Security has let some of you use the one day loophole by June 30, 2004, to bridge the time from when you resigned until you officially retire. One restriction is that you can not work in TRS until you reach your actual retirement age. An example of this would be that you are 49 years old, with a birthday after June 30, and 30 years of service. Thus you would not meet the "Magic 80" by June 30. According to our repetitive conferences with TRS and Social Security, this allows you to retire when eligible after you have taken advantage of “The Loophole.”

A worthy note for those of you who will never retire from TRS and just will take your money out. You can still qualify for your spousal or your own Social Security benefits as you did not retire under both systems. Please be sure and call us about the tax deferred rollover option when you leave TRS.

Also, if you presently collect spousal Social Security, you will not be purged from the system. We understand that DROP participant/retirees may now qualify for both systems if they took advantage of the loophole.

There is also transition legislation for some educators who have "dual district" time from the past (see www.ssa.gov or call 800.772.1213 and ask for a GPO specialist). It is best to get that explained by them directly.

Continue to watch our website for Social Security interpretations and updates on legislation to overturn “The Windfall Elimination Act,” which affects your own Social Security.

Whether you need a local seminar and/or group meeting or "individual retiree advice," please feel free to contact us at anytime for personal financial advice and deriving the most benefit from your 403(b), PLSO (Partial Lump Sum) or other financial planning. Note: control of your investment choices is even more important today. As many of you know, we have helped educators successfully for over 14 years (see also reference page).

Our Houston Main Office number for Jay Allen Finn, CPA is (800) 950-1829 and Tim Webster’s Northeast Texas office is (800) 285-8803. If you live in other areas; we will direct you to the right individual representative when you contact us.

This website is provided for educators by Educators Financial Seminars, a provider of no-cost, educational seminars and retirement plans to educator’s organizations, administrators and educators.

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