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your $ A magazine from WEA Member Benefits

™

Are you

SUMMER

2016

Retirement Ready?

Can you really retire the way you want to? We can help you find out.

} Nick and Karen Niehausen, retired Kettle Moraine School District and North Lake School District

your insurance

Enhancements and additions to your home insurance

your safety

Avoid deadly driving distractions

your kiosk

Home health care: More costly than you think


your $ {

CONTENTS SUMMER 2016

3 YOUR ACCOUNT

- Let us know if you’ve moved. - Keep your account here and continue to enjoy low fees. - Review your SRA and your beneficiaries.

4

- Nominate a financial mentor.

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4 YOUR RETIREMENT 8 YOUR SAFETY - If you’re getting close to retirement, you may have a lot of questions. We can help you find answers.

6 YOUR INSURANCE

- Enjoy more coverages and enhancements on your home policy. Plus, there’s a new, inexpensive option that can really pay off.

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YOUTUBE LOGO SPECS

on light backgrounds standard

- Avoid deadly driving distractions.

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10 YOUR KIOSK

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- Student artists celebrated at Member Benefits. - In-home health care may be more costly than you think. - Considerations for additional retirement contributions.

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watermark

stacked logo (for sharing only)

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president’s letter Dave Kijek, President/CEO, WEA Member Benefits

Follow us. © 2016 WEA Member Benefit Trust. All rights reserved.

Building your financial confidence with programs that fit your needs How many times do you plan to retire? That might seem like a funny question, because for most of us (unless you’re Brett Favre) the answer would be—one time. The significance of this may not be apparent, but because you only plan to do it once, you want to get it right. While we spend years perfecting our skills and building experience in our chosen professions, we often come to the end of our careers only to enter a

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new phase with no experience and little knowledge. Uncertainty about finances and retirement decision-making can be overwhelming and scary. You’ve worked hard, you’ve served your community, touched many lives, and made a difference—you deserve to retire with confidence. Read more on page 4 about how Member Benefits can help you get a realistic plan that is unique to your situation and goals with a Retirement Income Analysis. You won’t get this level of service, detail, personalization, and unbiased assistance anywhere else. Speaking of programs designed for educators…we just rolled out our new home policy. It’s been completely rewritten

with additional and improved coverages to benefit you—including educatorspecific coverages. Knowing your home is protected by an organization that works for you is a definite confidence booster. I also want to give a shout out to all the young artists who submitted their art for display in our reception area. What a treasure trove of talent we have in our Wisconsin public school students! Lastly, remember to take a moment to recognize those financial mentors who have made a difference to their colleagues with their financial encouragement and guidance. We’re confident they deserve some recognition. weabenefits.com


{ your account IRA and 403(b) news Are you on the move?

If you recently moved or have plans to move this summer, please let us know your new address. • Contact us directly at 1-800-279-4030 or log into yourmoney to change your address on your retirement savings accounts. • If you also have your auto or home insurance with us, you can use our online Update Your Policy form or call 1-800-279-4010 to make the change.

Retired or changed jobs? Keep enjoying our low fees

If you have a 403(b) or an IRA account with us, you can keep it here regardless of your employment status and continue to take advantage of our low fees and great customer service. Reminder: WEAC members receive additional savings with a lower annual fee cap on IRA accounts.

Don’t miss a chance to boost your savings

Are you maximizing your 403(b) contributions? Summer is a good time to update your Salary Reduction Agreement (SRA) so you’ll be ready to go for the school year. To update your SRA, please contact your school district business office for their most recent SRA, download our SRA at weabenefits.com, or if your district allows, you can update your SRA online through yourmoney at weabenefits.com/yourmoney.

Nominate a financial mentor before summer ends

Do you know someone who takes the time to give financial encouragement, advice, and guidance to his or her colleagues? Give that person some welldeserved recognition. It only takes a minute to nominate someone by visiting weabenefits.com/mentor.

Review your beneficiary designations annually

As you experience changes in your life such as marriage, divorce, or death, do not forget to review your beneficiary designations. The beneficiary designations associated with your retirement account(s) take precedence over your will. To view your current beneficiary designations through Member Benefits, log into weabenefits.com/yourmoney. Beneficiary change forms can also be downloaded from weabenefits.com/retirementforms. Content in this magazine is for informational purposes only and is not intended to constitute legal, financial, or tax advice. Certain recommendations or guidelines may not be appropriate for everyone. Consult your personal advisor or attorney for advice specific to your unique circumstances before taking action. The Trustee Custodian for the WEAC IRA accounts is Newport Trust Company. The 403(b) retirement program is offered by the WEA TSA Trust. TSA program registered representatives are licensed through WEA Investment Services, Inc., member FINRA. Property and casualty insurance programs are underwritten by WEA Property & Casualty Insurance Company. The terms and conditions of your coverage are exclusively controlled by your written policy. Please refer to your policy for details. Certain policy exclusions and limitations may apply.

Wondering if you qualify for our insurance program in retirement? As a Wisconsin public school employee, you are eligible to participate in our highquality personal insurance program, which includes auto, home, condo, renters, flood, and umbrella insurances. Our insurance products have been tailored to meet your unique needs as a Wisconsin educator.

If retirement is on the horizon

If you’re retiring soon and are interested in our insurance products, plan ahead. Once you retire, unless you have a 403(b) account with us, you may not qualify for our insurance program. However, you may become eligible after you retire if you purchase a WEAC-Retired membership.

Once you’re in, you’re in

Once you are in our insurance program, your eligibility to participate will continue as long as you keep your policy in force (subject to underwriting requirements). You do NOT need to leave just because you no longer meet one of our eligibility criteria—those criteria are only applied to those who are trying to enter the program.

We’re here to help

If you have any questions on eligibility or if you would like to get an insurance quote, give us a call at 1-800-279-4010.

{ Have a story to tell or article suggestion?

Send an e-mail to memberbenefits@weabenefits.com. Type “your$” into the subject line.

weabenefits.com

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{ your retirement

Are you

Retirement Ready?

If you’re within 10 years of retirement, you may be wondering: Can I really retire? Do I have enough money saved to support the lifestyle I want? How do I plan my budget and preserve my assets when I’m no longer working? Fortunately, Member Benefits can help you answer those questions and much more with a comprehensive Retirement Income Analysis. Most people approaching retirement really aren’t sure about their readiness—at least the financial aspect of it. It can be difficult to know what to account for and how to maximize your resources once you retire. If you feel lost and unsure, you’re not alone. The media and the Internet are full of general financial advice that is often contrary and not necessarily accurate. The financial gurus out there make blanket statements that may or may not fit your situation. For example, you may hear that you need to save $1 million dollars to retire. Brenda Echeverria, Financial Planner at Member Benefits, says, “This one-size-fits-all approach just doesn’t work for retirement planning since the amount you need for retirement is based on your specific needs and spending habits. Your ‘magic number’ may be vastly different from everyone else’s. Also consider that as a Wisconsin educator, your sources

of income in retirement will include the Wisconsin Retirement System (WRS) and possibly other post-employement benefits that are unique to public servants.” Let’s start with a simple fact: Planning for retirement is a highly personal process. And, you only retire once, so you want to get it right. Guidance from someone who understands the nuances of your situation can be beneficial. Fortunately, as a Wisconsin public school employee, you can take advantage of a financial planning service tailored to fit your needs—a Retirement Income Analysis (RIA).

What is an RIA?

An RIA is an in-depth, detailed service designed to help you (and your spouse/ partner) determine your readiness for retirement and provide a game plan for making important retirement decisions. It involves a discussion with our financial planner about your goals, an analysis of

your investments and savings accounts, and a review of other factors that impact your readiness that you may not have considered. Brenda says, “Many members have told us that an RIA gave them the confidence to retire. Until they see the numbers, they often think they ‘might’ be able to retire but are unsure.” That was true for Nick and Karen Niehausen. Nick explains, “I retired from Kettle Moraine Middle School earlier than I originally intended. The plan gave us real comfort in knowing that, yes, we were in pretty good shape. We can retire now and we can maintain our lifestyle because we have a plan to make our money last into the future.” The RIA process takes a comprehensive look at all of your investments and major expenses. It can help you answer questions you may have never thought of, such as: • Do you plan on leaving a legacy to your

Retirement Income Analysis Cost: $1,900

Participants pay $950 Eligible WEA Tax Sheltered Annuity Trust participants receive a 50% discount off the base cost of $1,900. Plus, WEAC members receive an additional discount. Call for details.

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weabenefits.com 1-800-279-4030 or weafa@weabenefits.com


children or spending down to the last penny? • How long should you estimate your retirement years to be? • What tax bracket will you likely be in during retirement and how can you plan for it? • Do you plan to move after retiring? • Will you help with your kids’ expenses? • How will you budget for things such as replacing cars? • What post-employment benefits will you have? What will your health care costs be? • Do you expect to receive additional assets in the future, such as an inheritance? • Are you calculating your Social Security estimate correctly? When should you start collecting? • How do you draw from WRS? • If you die first, will your partner be okay financially? • Have you planned for your funeral expenses? Your will?

What you’ll come away with

You will meet with our planner several times for the RIA (see page 9). At the final meeting, you’ll receive a binder with a detailed analysis of your situation that will give you realistic expectations for covering your expenses, from the basics to the fun things you may want to do. Says Brenda, “You may find you’re on target, or you may need to work a bit longer, save more, or invest more aggressively to meet your goals. We take a look at all of the options so you can start planning and making decisions.” In the analysis, everything is on a timeline and many scenarios are accounted for. It is based on when you’d like to retire and takes into account your life expectancy, inflation on certain items, tax rates on withdrawals, sources of income, and a 15-year historical rate of return on your current accounts to help estimate future returns. Karen was impressed. “We were literally taken page by page through our financial plan, which was incredible!” she says. With the RIA, you can expect to receive: • A summary of the value of your investments. It’s a good idea to check this at the end of every year to see if it’s tracking.

weabenefits.com

• Plan assumptions: A summary of your assets, liabilities, income, and expenses, including plans for future travel, weddings, replacing vehicles, vacation rentals, etc. • Your expected WRS and Social Security benefits and their assumed start dates. • Charts for expected expenses over time, cash flow analysis, value of investments, and investment assets by asset class. • Tables on required minimum distributions and future tax predictions. • A Monte Carlo analysis on the value of your investments, which is a hypothetical projection of the chances of meeting your expense needs. • Overall recommendations and solutions. • Disclosure document.

“We were literally taken page by page through our financial plan...We come back every year for a free consult to re-evaluate.”

Worth the cost

Our financial planners specialize in working with Wisconsin public school employees, so we understand the unique retirement benefits available to you. If you have a 403(b) with us, an RIA will cost $950 (half of the full price). And, if you’re a member of WEAC, there is an additional discount ($100 for union members or $150 for WEAC-Retired). Karen explains, “Because we had a 403(b) with Member Benefits, we got the reduced price. That was really attractive—plus we got a consultation a year later, which helped a lot. When I walked away from those meetings, I’d be shaking my head, ‘Yeah, I get it.’ And then later I’d be like, ‘No, I don’t get it.’ So it’s really nice to come back for the free annual consults to ask, ‘Is this what I’m understanding, is this right?’”

Be aware and beware

It’s important to know who you’re talking to. Says Brenda, “Member Benefits financial planners are committed to work in the best interest of the client. There are no product sales or commissions attached to our services, so you will get an unbiased analysis of your situation.” Holding ourselves to a high ethical standard means you can expect: Continued on page 9

A common mistake When you look at your official Social Security statement, the estimated benefit is based on your average earnings and assumes you’ll continue to make a similar income up until retirement. However, many Wisconsin public school employees Continued on page 9 so retire before full retirement age, you may receive less than what your statement predicts. That’s just one factor of many we’ll help you consider to get a more realistic picture of what you’ll have in retirement.

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{ your insurance

B

h a t n r eve e t t e

r

HOME POLICY

Provides even more protection for Wisconsin educators

I

6

nsuring your home is about protecting your investment and personal property. It’s also about protecting your family from loss that could be financially devastating. What’s in your policy, how much protection you have, and whether your insurance will come through when you need it most are key factors for avoiding costly surprises. Since our inception, WEA Member Benefits has focused on providing superior coverage and claims experience for Wisconsin public school employees. Our unique mission makes it easy to do what’s in the best interest of our participants. Starting July 1, 2016, WEA Member Benefits will provide enhanced and expanded coverages for our participants and their families. These changes are the result of a year-long process of rewriting our home policy. For this process, we had

two goals in mind: 1. Make the policy easier to read and more member-friendly, and provide clarity about what the policy covers. Industry wide, policies tend to be written like technical or legal documents that are not consumer-friendly. Our new policy is designed with an emphasis on financial education and includes features such as a table of contents, definitions of key words, and steps to take in case of an accident or loss. We want to make it easier to understand your policy coverages so you can be confident in what you are receiving for your premium dollar. 2. Enhance and expand coverages that add value and provide greater protection. More than a dozen changes were made to the policy to increase your coverage. For example, we enhanced and extended the Guaranteed Replacement Cost (GRC). Our GRC means we will pay the full cost to repair or replace your

home even if that cost exceeds your policy. We guarantee it! In the past, to be eligible for GRC your home had to be less than 50 years old. Under the new policy, GRC eligibility includes homes built during or after 1950. And, for those homes that were built prior to 1950, we added Extended Replacement Cost, which provides up to 125% of the dwelling limit on your policy. In addition, because we serve the education community, we understand the unique risks for financial loss that go with the profession. So we increased coverage for personal property losses on school premises—regardless of the cause of loss—to $2,000. We also added coverage up to $500 ($100 per hour) for loss of preparation materials for classroomrelated activities that were either stolen or damaged by a covered loss. Plus, deductibles don’t apply.

weabenefits.com


Our exceptional

Guaranteed Replacement Cost coverage just got better.

ENHANCED! If your home was built in 1950 or later, we will pay the full cost to repair or replace your home with materials of like kind and quality without the limits imposed by most other insurers. NEW! Extended Replacement Cost for homes built before 1950 allows for up to 125% of the dwelling limit on your policy. (Certain restrictions may apply.) INCREASED COVERAGES • Loss on School Premises Coverage increased to $2,000 All peril! No deductible! • Loss of Business Property while on insured premises. Coverage increased to $3,000.

New! Equipment Breakdown Coverage for just $26 per year

Surprise! You wake up to find your furnace or air conditioner stopped working, your electronics were Just fried by a power surge, or your refrigerator has $2.17 pe r died. These costly events can turn your household month! finances upside down. Member Benefits now offers Equipment Breakdown Coverage for participants in our home insurance program. Equipment breakdown coverage provides primary coverage for mechanical, electrical, and pressure systems breakdown. This inexpensive coverage reduces gaps in home coverage, provides green environmental coverage and efficiency improvements, and can replace more costly home warranty programs and “big-box” retailers’ extended warranties.

Covers breakdown of washer/ dryer, refrigerator, oven, pool/ spa equipment, and more.

• Loss of Business Property while away from insured premises. Coverage increased to $1,500. • Dismounted Campers /Trailers. Coverage increased to $1,500. • Credit Card Loss/Theft. Coverage increased to $1,500. • Damage to Property of Others. Coverage increased to $1,500.

Covers breakdown of boilers, furnaces, heat pumps, solar units, air conditioners, electrical panels, hot water heaters, humidifiers, and more.

• Medical Payments. Coverage increased to $5,000.

NEW COVERAGES • Loss of Prep Materials up to $500. No deductible! • Replacement Garage Door Opener Coverage. Up to $500 to replace stolen garage door openers. No deductible! • Digital Media Recovery Coverage. Up to $1,500.

• WAIVED DEDUCTIBLE ON Identity Theft claims.

Property and casualty insurance programs are underwritten by WEA Property & Casualty Insurance Company. The terms and conditions of your coverage are exclusively controlled by your written policy. Please refer to your policy for details. Certain policy exclusions and limitations may apply.

weabenefits.com

Replaces more costly home warranty programs and “big-box” retailers’ extended warranties.

Call one of our Personal Insurance Consultants for more information at 1-800-279-4010.

Covers breakdown of computer, telephone, audio/video systems, televisions, security systems, and more.

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{ your safety

Reading a tex t while drivin g 55 mph takes your eyes off the road long enough to cover a footba ll field.

Fatal

Distractions

The dangerous side of distracted driving It’s estimated that one in ten motor vehicle accident fatalities are the result of distracted driving. Of those distracted drivers, a whopping 62% were “generally distracted” or “lost in thought.”1 So what causes so many drivers to feel they can take their eyes and mind off the road? The answer: complacency. After you’ve been driving for a while, you get comfortable. It’s easy to forget how dangerous driving can be. As a result, you’re more likely to feel like you can daydream or send a quick text without putting yourself in danger. Rushing, frustration, and fatigue only compound the problem. And it’s not just you out there who may be distracted, but other drivers on the road. Adopting defensive-driving techniques can keep you safer and may even save you money. WEA Member Benefits offers an accident-free discount on auto insurance premiums if the drivers in your household have not had any at-fault accidents within the last three years. Want to learn how to drive defensively? Take an accredited course on defensive-driving techniques or practice these tips: 1. Minimize distractions. Concentrate on the road, not other tasks. 2. Keep your eyes moving and stay alert. Continuously look in your mirrors and scan the road ahead. Anticipate problems before they develop. 3. Go with the flow. Keep up with traffic. Speeding and driving too slowly are both dangerous.

4. Maintain distance. Follow the 3-second rule for the space between you and the car in front. 5. Make yourself visible. Turn on your lights during the day, use turn signals, and avoid blind spots. 6. Resist road rage. Retaliating against an aggressive driver is dangerous. Maintain your speed while letting aggressive drivers pass by.

You may not think you’re a distracted driver, but how many of these things have you done while operating a vehicle?

p Ate or drank while driving p Applied makeup p Held a dog p Tended to a child p Talked on a cell phone

p Read or sent a text p Adjusted climate controls or vehicle devices (clock, mirrors, radio, etc.) p Operated GPS navigation system

p Talked to a passenger p Daydreamed p Bent down to pick something up p Been “blinded” by sun glare

zz z

p “Rubbernecked” an event or accident scene p Smoked a cigarette p Took two hands off the wheel

Text Message

Send

1. Fatality Analysis Reporting System (FARS) data and the National Highway Traffic Safety Board.

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weabenefits.com


Continued from page 5 • Objective financial advice. • A high degree of professionalism. • Clear information in writing on services provided and the cost for those services. When looking elsewhere for financial help, watch out for bait-and-switch offers. Many brokers will offer you a “free’ analysis as a sales tool to sell you something else, like life insurance. These analyses are typically generic in nature. Brenda sees this all the time and believes it’s misleading. You can find questions to ask and resources to use when shopping for a planner at weabenefits.com/askquestions. Buyer beware!

Best advice

Brenda’s advice? “Anticipate your future tax liability and make necessary changes now before you retire. Get a real picture of your assets and challenges, with help from a planner if you need it. And give yourself permission to spend when you’re younger instead of waiting...there’s nothing to be afraid of when you have a realistic picture.”

{ A.

Retirement Income Analysis planning steps

1 2 3 4 5

Initial consultation This free, no-obligation consultation gives you a chance to talk with a Member Benefits’ financial planner who can assess your situation and recommend the direction you should take. Data gathering Fill out a data gather package before this face-to-face appointment. Over the course of 2½ hours, you’ll review a sample analysis, sign a service agreement, pay the fee, go over documents, and identify, develop, and prioritize your financial goals and objectives. Analysis and plan development In about a month’s time, our financial planner analyzes your information, develops strategies, and writes recommendations to meet your goals. You can request up to three scenarios for the planner to consider. Presenting the plan At this face-to-face meeting, the planner will review the analysis, present the recommendations, and describe the specific strategies included in the retirement plan. Monitoring progress Schedule follow-up meetings to monitor your progress and make adjustments to your plan as needed. As a Wisconsin public school employee, you are entitled to a free one-hour consultation each year which can be used to review your RIA.

All investment advisory services are offered through WEA Financial Advisors, Inc.

Spending early may actually be financially beneficial. Go figure! People nearing retirement often find it hard to give themselves permission to access their retirement savings accounts. This can cause income tax problems in later years they may not have considered because they assume delaying withdrawals will save them money. Below is an example of how withdrawing money sooner could still maintain your balance and help avoid increased tax liability.

ASSUMPTIONS: Married couple, both 62-years-old, retired $60,000 taxable income, plus $400,000 saved in a 403(b) with an average 5% annual return Wait until age 70½ to withdraw funds Total grows to $591,000 at age 70½ Required minimum distribution (RMD) at age 70½ = $21,570

B.

Withdraw $20,000 every year from now until age 70½ Maintains a balance of about $400,000 at age 70½ RMD at age 70½ = $14,598

$60,000 taxable income + $21,570 RMD = $81,570 total taxable income from line 43 on a 1040

$60,000 taxable income + $14,598 RMD = $74,598 total taxable income from line 43 on a 1040

Based on 2016 tax rates: 1st $18,550 is taxed at 10% $18,551 - $75,300 taxed at 15% Remaining $6270 taxed at 25%

Based on 2016 tax rates: 1st $18,550 is taxed at 10% $18,551 - $75,300 taxed at 15%

In situation B, withdrawing some money each year gives this couple more income to do the things they want to do in their younger retirement years while keeping most of their original balance AND maintaining a lower income tax bracket. If this couple is not going to spend the $20,000 withdrawal on themselves each year, they probably don’t want to take money out of their pretax accounts just to place it in a savings account that earns very little. They could consider gifting to their children, increasing their charitable contributions, setting up college education accounts for grandchildren, or making conversions to Roth IRAs. This scenario is for informational purposes only and is not intended to constitute legal, financial, or tax advice. Certain recommendations or guidelines may not be appropriate for everyone. Consult your personal advisor or attorney for advice specific to your unique circumstances before taking action.

weabenefits.com

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{ your kiosk

Art

worth celebrating

In March, the Wisconsin Art Education Association hosted their annual statewide art show at the capitol. Wow! The caliber of the student art was impressive. The event was a celebration of student talent and the dedication of teachers in Wisconsin public schools. And, it inspired Member Benefits to get in on the celebration. We have the perfect wall in our reception area to showcase student art. So, we sent out a request to art teachers to have students submit their artwork for a contest. They more than answered the call! We received 44 submissions (4K–12): drawings, paintings, photographs, and 3-D art made from recycled items. Eleven pieces were selected—not an easy task— to be on display in our office for twelve months starting later this summer. You are invited to stop in and see what wonderful things are coming out of the creative minds of students in Wisconsin. Congratulations to our destined da Vincis, promising Picassos, and rising

Rembrandts! Students and their art teacher each received a $50 Amazon gift card for allowing us to display their art.

Leena Myers, 10th Grade, Whitnall School District. Art teacher: Amelia Hernandez. Yadiel Choren, Kindergarten, J.P. Gravell, 2nd Grade, and Mia Rienzi, 5th Grade, Shorewood School District. Art teacher: Angela Hayes. MacKenzie Chady, Lori Quigley, and Grace Shockman, all 12th Grade, Fort Atkinson School District. Art teacher: Angie Szabo. Ezekial Pavlac, Kindergarten, and Jadelynn Turk Haley, 4K, Black River Falls School District. Art teacher: Jen Dahl. Jamie Bistodeau and Tristyn Hutchins, both 12th Grade, Necedah School District. Art teacher: Megan Sluyter.

(Top photo) “Chance Meeting” Leena Myers, 10th Grade Whitnall School District (Bottom photo) “Play on a City” Grace Shockman, 12th Grade Fort Atkinson School District

In-home health care costs more than you think Genworth Financial’s 2016 annual Cost of Care Study has found that longterm care costs continue to rise, especially services for care in the home. Home health care is the most popular long-term care option among families. However, according to Genworth, one-third of adults surveyed seriously underestimate home health care costs (see illustration). Understanding the true costs related to long-term care can help families plan ahead for how they will pay for these services before they need them. For information about long-term care insurance options, visit weabenefits.com/ltc or call 1-888-247-5905.

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Perceived cost of in-home care

Actual cost of in-home care

$417

$3,861

Nearly one-third of Americans believe costs for these services to run under $417 per month.

The national median rate is $3,861 per month for an in-home aide.

Long-term care (LTC) insurance products are underwritten by multiple LTC insurers. Program administered by LTCi Marketing Administrators Inc. (LiMA).

weabenefits.com


Q&A

Additional retirement contributions

Nominate your financial mentor! “She does an amazing job in being a mentor for staff and encouraging them to save. She is really making a difference.” “He stresses good financial habits and is always willing to help answer questions or suggest a resource.”

Do you know someone who takes the time to give financial encouragement, advice, and guidance to his or her colleagues? Chances are there is someone in your district who goes the extra mile to help others build financial security. Or maybe it’s you! Why not show that person some appreciation? It only takes a minute to submit a nomination online. Award winners will be mentioned in the fall your$ magazine and receive a certificate of recognition.

Nominations for the 2016 awards will be accepted through September 2, 2016.

Visit weabenefits.com/mentor and nominate a financial mentor today! weabenefits.com

What do I need to consider if I want to put additional money toward my retirement above my 6.6% contribution to WRS? Should I put it in WRS or another retirement product such as a 403(b) or IRA? In many cases, a 403(b) or IRA may be a better place to put additional contributions because of the tax advantages they offer. With a pretax 403(b) or IRA, you are able to reduce your income now and defer taxes until you withdraw in retirement. With a Roth 403(b) or IRA, you pay the tax now on contributions but benefit from tax-free growth when you withdraw. In contrast, excess WRS contributions do not offer either of these tax advantages because the Internal Revenue Service does not allow you to deduct your contributions nor does it allow the benefit of tax-free growth. If you’ve already made the maximum allowable contributions in every taxadvantaged plan available, then you may want to consider making after-tax additional contributions to WRS. Just keep these points in mind: • The growth on additional contributions you make will be taxed when you withdraw. • Additional contributions do not buy you more years of service (a commonly held misconception). • You are not required to annuitize additional contributions like you are for the main pension. • The additional contribution portion of your WRS account does not need to be taken in any form when you retire. You may defer distributions until age 70½. If you have questions about this or other retirement topics, give us a call at 1-800-279-4030. This article is for informational purposes only and is not intended to constitute legal, financial, or tax advice. Certain recommendations or guidelines may not be appropriate for everyone. Consult your personal advisor or attorney for advice specific to your unique circumstances before taking action.

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PO Box 7893, Madison, WI 53707-7893

Make a wise financial choice and help secure your future by opening an IRA. Summer is a great time to get started! Start saving in an IRA now with as little as $25 per month. Even a small investment can pay off big later on because you can take advantage of compound interest. And with Member Benefits, you’ll only pay one low annual administrative fee of 0.45% (capped annually at $600 for WEAC members and $750 for nonmembers)*, so more of your money will be working for you.

Ask about o ur special IRA promotion!

Ends August

28, 2016.

Plus, it’s so easy to enroll. Just give us a call or go online at your convenience.

1-800-279-4030 • weabenefits.com/enrollira We can help you, your parent, spouse, or other eligible family members start saving today.** This is for informational purposes only and is not intended to constitute legal, financial, or tax advice. Certain recommendations or guidelines may not be appropriate for everyone. Consult your personal advisor or attorney for advice specific to your unique circumstances before taking action. The Trustee Custodian for the WEAC IRA accounts is Newport Trust Company. To be eligible for this program, you must meet the IRS eligibility requirements for contributing to an IRA. *Minimum annual fee of $25 for inactive accounts. Inactive accounts are accounts with no contributions within a calendar year. Mutual fund management and redemption fees apply. **Restrictions may apply. Wisconsin residency required.

Your$ Magazine -- Summer 2016  

Can you really retire the way you want to? We can help you find out. Also in this issue: Enhancements and additions to your home insurance;...

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