It's never too early to think about and plan for retirement. Retirement benefits from teaching part-time will not provide adequate income on which to retire; however, there are differences in the plans offered that you should become familiar with. CLPCCD has three plans available for part-time faculty or you can choose to stay on Social Security.
CalSTRS administers a hybrid retirement system as part of a comprehensive financial security package for members that includes:
Defined Benefit Program – a traditional defined benefit plan
Pension based on a formula using age, service and compensation.
Member participation is mandatory.
Defined Benefit Supplement Program – a cash balance plan
Acts like a 401(k), but similar to defined benefit plans with a minimum earnings guarantee.
Member participation is mandatory.
Fact Sheet: The Basics of a Cash Balance Plan.
Pension2 – a defined contribution plan
Voluntary retirement savings through 403(b) and 457(b) plans.
Participation is optional.
It could take a part-time faculty member as much as ten years to vest in this program since it requires five years of full-time service credit. The District implements the STRS service credit, reporting changes for part-time faculty accordingly, and allowing for one year of service credit for 30 CAH of employment per year.
You can vest immediately in this program, as it is not dependent on service credit. It calls for a payroll contribution of 4% of regular salary from the employee and 4% from the District as the employer contribution. Your contributions are made on a pre-tax basis, reducing the amount of your taxable income. Upon retirement, funds can be disbursed in a lump-sum or rolled over into an annuity.
Participation is optional. You can request pre-tax deductions from your paycheck into 403(b) and 457(b) plans for additional savings.
Social Security Basics: You may be eligible to collect Social Security if you paid into it and accumulated 10 years or 40 quarters of credit. Visit the Social Security Administration website and create a My Social Security account. You may elect to continue with Social Security if you are vested in Social Security or otherwise expect Social Security to be your primary retirement system.
WEP aka Windfall Elimination Provision may impact the Social Security benefits you are eligible to receive. Your Social Security benefit might be reduced if you get a pension from an employer who wasn’t required to withhold Social Security taxes.
GPO aka Government Pension Offset can eliminate your benefits as a spouse. The Government Pension Offset (GPO) adjusts Social Security spousal or widow(er) benefits for people who receive “non-covered pensions.” A non-covered pension is a pension paid by an employer that does not withhold Social Security taxes from your salary, typically, state and local governments or non-U.S. employers.
On being hired, you must choose from the three retirement plans described above within 60 days of becoming employed. Please make sure to fill out the appropriate forms (i.e., if you elect for the Defined Benefit).
You have the right to change plans. If you are interested in switching to a different plan, check with Human Resources for details and eligibility.