| |
State Retirement and Pension
System
|
Optional Retirement Program |
| Type of Program |
Defined benefit plan
Provides a
determinable benefit based upon your salary and service.
|
Defined contribution plan
Provides a
benefit based upon your accumulated account balance. |
| How Benefits Are Determined |
Benefits are calculated using a specific
formula that takes into consideration a fixed percentage of your years of
creditable service and final average salary.
|
Benefits are based on your ORP account
accumulation which consists of State contributions, income, expenses and
investment gains and losses. |
| Contributions |
State contributions vary annually. They are
determined by the State System's actuary. You must contribute 5% of your
annual salary. |
The State contributes a certain percentage of
our salary each year to your ORP account. (Currently, the contribution
rate is 7.25% of salary.) |
| Investment Management |
The SRPS assets are invested by professional
investment managers chosen by the SRPS Board of Trustees. You do not bear
any investment risk. |
You choose one of four investment vendors when
you join the plan. You may invest your account among your vendor's
investment options. You bear all investment risk. |
| Retirement Benefit |
After 30 years of eligibility service,
or
age 62 with 5 years
age 63 with 4 years
age 64 with 3
years
age 65 or older with 2 years
|
Benefits may begin upon separation from
employment. [A federal penalty tax may apply.] |
| Early Retirement Benefit |
After age 55 with 15 or more years of
eligibility service. Benefit is reduced 1/2% each month by which
your retirement date precedes age 62. |
Benefits may begin upon separation from
employment. [A federal penalty tax may apply.] |
| Disability |
Ordinary disability: you must be permanently
disabled and have 5 or more years of eligibility
service.
Accidental disability: you must be permanently and
totally disabled as a direct result of a job related injury. |
The ORP investment accounts do not include
disability benefits. However, if you become disabled, you may receive the
full value of your current ORP account balance. |
| Death Benefit |
Pre-retirement death benefits are available.
The benefit amount depends upon the age and eligibility service at
death. |
Pre-retirement death benefits are available.
The benefit is your account balance -- including all State contributions
and investments earnings -- paid to your designated beneficiary(ies) or
estate. |
| Vested Retirement Allowance |
You are fully vested after completing
five years of eligibility service. Benefit payments may commence at
age 62 or reduced payments may commence as early as age 55 with 15 years
of eligibility service. |
You are immediately fully vested in your total
account balance. Benefits may begin upon separation form employment. [A
federal penalty tax may apply.] |
| How Benefits are Paid |
You may elect one of several payment options
available under the program. |
You may elect one of several payment options
available through your investment vendor. |
| Cost-of-Living Increases |
Adjustment is made each July 1. Cost-of-living
adjustment has a 3% simple interest annual cap.
|
ORP benefits do not include an annual
cost-of-living adjustment. |
| Portability |
SRPS benefits are transferable among certain
governmental plans within the State of Maryland |
ORP accounts are fully transportable to any
employer offering the same investment provider. |
| Transferring Benefits |
Transfer is possible among certain governmental
plans within the State of Maryland. However, there is no transfer between
out-of state systems and the State Retirement and Pension System.
|
Your benefits are vested immediately. This
means you may accumulate additional funds with the same vendor in another
employer's 403(b) retirement program if that same vendor is offered as an
investment provider in you new employer's
plan. |
