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Are you considering retirement and/or are ready to retire? Congratulations! Below you will find information and resources on the steps you must take in order to initiate retirement, and information to help you make sure that the transition into retirement is as smooth as possible.
An employee who elects to retire and is at least 55 years of age and has the combination of age and full years of service totaling 75 may remain on the City's health plan and is required to pay the premium contribution in effect at the time of retirement. An employee retiring from the Police or Fire Union must be at least 50 years of age with twenty years or more of continuous service. An employee retiring from the Water or Wastewater Utility must be at least 55 years of age and have 25 years or more of continuous service. Retired employees will receive the same insurance benefits as active employees and will be subject to the same plan changes as active employees. Employees hired on or after January 1, 2007 will not be allowed to remain in the health plan upon reaching the age of Medicare Eligibility. An employee hired into the Police Union on or after January 1, 2010 will not be allowed to remain in the health plan upon reaching the age of Medicare eligibility. An employee hired into the Water or Wastewater Utility on or after May 1, 2007 will not be allowed to remain in the health plan upon reaching the age of Medicare Eligibility.
Retirees are required to enroll in Medicare Part B and the City will continue to provide insurance and pay for Medicare Part B. Employees hired on or after January 1, 2007 are not eligible for Medicare Part B payments. Employees hired into the Police Union on or after January 1, 2010 are not eligible for Medicare Part B payments. Employees hire into the Water Utility or Wastewater Utility on or after May 1, 2007 are not eligible for Medicare Part B payments.
If an employee retires with a single health insurance policy, this retiree will not be allowed to add any spouse or children after retirement. An employee who retires with a family policy will be allowed to add a new spouse or children after retirement.
To view the benefits for Pre-Medicare eligible retirees, visit the following website;
Pre-Medicare Eligible Retirees Health Insurance Information
The prescription coverage is through CVS Caremark, and all prescription costs that you pay will go towards the deductible. A quarterly invoice is mailed to retirees. If you are retiring from the Police or Fire Union, you may use your deferred compensation account to pay for your health insurance premiums throughout retirement. Please contact your deferred compensation provider to speak with them about this process.
Dental & Vision Insurance
Dental and Vision Insurance end at the end of the month you retire. If you are enrolled in the dental and vision insurance coverage upon retirement, you will be offered dental and vision insurance coverage through COBRA. The City will mail you a COBRA notice.
The Life Insurance Policy is through Employee Trust Funds. The Basic Unit and each Additional Unit of life insurance is equal to your highest annual earnings throughout your employment at the City of Racine. The Unit amount stays the same starting at retirement, until the age of 65. The Basic Unit and Additional Unit premiums will be deducted out of your pension check. The City will reimburse you on a quarterly basis for the Basic Unit premium. Once you turn 65, the Additional Units of Life Insurance (if applicable) will automatically be dropped from your policy, so you will be left with the Basic Unit of Life Insurance. At age 65, 66, and 67 the worth of that Basic Unit of Life Insurance will decrease by 25% each year. For example; If you have $83,000 in coverage at retirement at age 62, this will stay the same until you turn age 65, where the coverage will be worth $62,250 (decreasing by 25%). At age 66, the policy will be worth $41,500 (50% of original value, dropping an additional 25%). At age 67, the policy will be worth $20,750 (25% of original value, dropping an additional 25%). The original value of the Basic Unit of Life Insurance will drop 75% total by the age of 67. You will keep the remaining amount for the rest of life. Spouse and Dependent Units of Life Insurance will end at retirement unless you convert it to a whole life policy within 31 days.
You may be able to continue certain policies after retirement. Call AFLAC at (800) 992-3522 for more information.
You will need to place a call to the Wisconsin Retirement System, (877) 533-5020 to request a retirement packet. It often takes up to two months to receive this packet, which contains all of the necessary forms and estimated amounts for the various retirement annuity options. When you request this packet from WRS, you will need to provide them a projected date of retirement that is less than one year in the future. This is not a date that you will be held to - it is merely a date used for the computations.
Retirement paperwork must be returned to the Wisconsin Retirement System a minimum of 60 days prior to your effective retirement date in order to get the first check in a timely fashion. You cannot return the retirement pack to WRS any earlier than 90 days before the effective retirement date.
The Wisconsin Retirement System uses two methods of computing your retirement benefits. The first method is a formula calculation that takes your highest three calendar years of pay times a factor times the number of years you have made contributions to WRS. The WRS uses one factor for service before 2000 and another factor for service in 2000 and later. The second method is a money purchase benefit calculation, which uses the total funds (contributions and earnings) that have been accumulated into your WRS account and your current age. You receive the larger of the two calculations. WRS has booklets available that describe the two calculations in detail. You can also visit the Employee Trust Funds website (http://etf.wi.gov/) and use calculators that compute estimated retirement payments.
You have the ability to purchase prior service that you may have forfeited earlier. You also have the opportunity to purchase certain governmental service. Contact the Wisconsin Retirement System for a booklet and details.
If you have military service, you will need to provide the Wisconsin Retirement System with a copy of your DD214 at any time. WRS will keep it on file for the calculation when you retire. This service will not show up on any year-end statements showing years of service. It is only used when you retire and your retirement benefit is being calculated.
At the above ETF website, you can click on the "Retirement" tab and the "Applying for Retirement" section, and you will find a Retirement Planning Checklist and a WRS Retirement Benefits Calculator that you can use to help calculate what your benefits would look like today.
What age do I have to be in order to retire?
Aside from disability, you can retire at age 55 as long as age plus your years of service equal 75 years. An employee retiring from the Police or Fire Union must be at least 50 years of age with 20 years or more of continuous service. An employee retiring from the Water or Wastewater Utility must be at least 55 years of age and have 25 years or more of continuous service.
What happens with my Health Savings Account (H.S.A.) when I retire?
If you are still covered by a High Deductible Health Plan, you are eligible to continue funding your HSA account. Most people begin Medicare at age 65 and are no longer eligible to fund their HSA account at that point; however, your HSA account can continue to be used for qualified medical expenses during retirement.
Will I receive an invoice for my health insurance premium?
Yes, you will receive an invoice in the mail each quarter for your health insurance premium. The address to send the payment to will be listed on the invoice.
Can I pay for the health insurance premium for the full year?
Yes, you can pay for the full year all at once. You will need to contact the Benefits Coordinator at (262) 636-9474 in order to do this.
Listed below are resources that are beneficial to look at if you are considering retiring from the City of Racine.
* If you need your login information, please contact Human Resources at 262-636-9175.
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