STRS Ohio Recognizes 100th Anniversary
A Legacy of Service to Ohio Educators
The State Teachers Retirement System of Ohio was established by law in 1919 — the first statewide, actuarial-based teacher retirement system in the United States. After a century of providing retirement benefits and quality service to its members, STRS Ohio will recognize its 100th anniversary during fiscal year 2020 (July 1, 2019–June 30, 2020). The centennial is a milestone worthy of acknowledgment as the system focuses on strengthening its financial position and continues its mission to partner with members in helping to build retirement security.
The State Teachers Retirement Board and staff invite you to visit the special anniversary section of the system’s website and be a part of the 100th anniversary recognition as we honor Ohio’s teachers for their contributions to society. The special website section offers a timeline of significant dates in the retirement system’s history plus an opportunity to share your favorite stories from your time in the classroom or from your years in retirement. We hope that you will visit the site frequently throughout the year to see what favorite memories your colleagues have shared and what new updates have been added. Plus, check out STRS Ohio on our social media channels as we recognize 100 years of serving Ohio’s public educators.
Board Adopts Amendments to Its Funding Policy
Following several months of review and discussion, the Retirement Board adopted amendments to its funding policy. The board’s funding policy includes the stated purpose “... to state the Board’s objectives for funding and to lay out clear criteria for making decisions regarding changes to funding and benefits, as well as when those changes should be considered by the Board.” The funding policy’s goal is “... to safeguard members’ benefits in the long term.”
The funding objectives in the policy include:
- 100% funding
– At 85% or greater, the Board may consider plan changes that in the determination of the Board’s actuary do not materially impair the fiscal integrity of the system.
- Manage the risk of unanticipated benefit changes
- Intergenerational equity, to the extent consistent with the other funding objectives
- Transparency and accountability
During the discussion about the funding policy, the board chose to add the 85% language above. The approved amendment allows the board to consider plan changes when the funded ratio reaches 85% or higher, but the board’s actuary must determine that any proposed changes do not materially impair the fiscal integrity of the system.
STRS Ohio will continue to share updates from each board meeting on our website and through our eUPDATE email news service. You can register for this service by providing your email address through your Online Personal Account.
Member Survey Results Show Positive Perceptions of STRS Ohio
Research with STRS Ohio members and retirees conducted in late 2018 reveal that 95% of retirees and 82% of active members have positive overall impressions of the Retirement System. Key findings from the survey results also included:
- Trust and confidence in the system remained steady for both retirees (84%) and active educators (73%).
- About three quarters of retirees and three out of five active members have positive impressions of the Retirement Board; compared with last year, more members believe the board is headed in the right direction.
- Most members are satisfied with STRS Ohio communications — including email updates — with 91% of retirees and 84% of active members indicating that STRS Ohio keeps them well-informed about pension- and retirement-related issues.
- About seven out of 10 active members are setting aside additional savings for retirement.
- More than eight out of 10 retiree households have at least one source of income in addition to their STRS Ohio pension. Investments and spouse’s pension are the most common forms of additional income. The survey showed that on average, STRS Ohio provides 62% of retirees’ income.
Don't Let Final Average Salary Limitations Catch You by Surprise
FAS Limitations Can Affect Your Retirement Benefit
If you plan on retiring in the next several years and are considering taking on additional duties to increase your salary, you need to know that there are limits on earnings that are used to calculate the final average salary (FAS) that is included in the retirement benefit formula. The FAS is the average of your five highest years of earnings, but it is subject to certain limits that are required by law to help ensure that members’ retirement benefits have been properly funded.
If you work extra duties, it may benefit you by providing extra salary during your working years but may not increase your FAS at retirement. Your FAS will be limited if the extra earnings you receive cause the percentage increases in your two highest years of earnings to be greater than the increases in the three years that immediately precede the earlier of the two highest years. Compensation for a partial year of service may also be limited. Examples of extra duties in the two highest years of earnings that may trigger a limit to your FAS include:
- Accepting a supplemental contract, summer school teaching (K–12) or summer session (college and university).
- Assuming extra duties that required working extra days or hours.
- Working additional duties for three years, but not teaching through the last day of the school year in the last year.
- Performing services for the school district for years with no pay and then getting paid for those duties only in the last, last two or last two years and a partial year.
- Receiving a supplemental contract for services performed as a mentoring teacher as part of the licensing requirement for teachers in your district.
- Working overload assignments in addition to your regularly salaried employment, even if that was required.
- Accepting new employment or more pay in a position covered by the Ohio Public Employees Retirement System or the School Employees Retirement System in addition to your employment covered by STRS Ohio.
- Being assigned extra duties in the last two years as a result of a collective bargaining agreement.
- Accepting an interim or short-term position that results in a significant increase in pay.
- Accepting a new part-time position with another STRS Ohio-covered employer.
These are some of the more common reasons for FAS limits, but they are not the only examples. Please note — while all of these earnings may not be included in your FAS, at least a portion of the earnings are included in many cases, which could result in a higher FAS than if the extra duties had not been performed.
Please be sure to discuss your retirement with an STRS Ohio benefits counselor at least twice before retirement. If you earn additional amounts beyond your contract for regular teaching duties, you should talk with a counselor at least four years before you retire. Also, if you do not plan to work through the last day of your contract in your last year of teaching, be sure to discuss this plan with a benefits counselor before your retirement. For more information or to schedule a counseling session, call STRS Ohio toll-free at 888‑227‑7877.
Supplemental Savings Programs Can Boost Your Retirement Readiness
If you are looking for an optional investment account in addition to your STRS Ohio retirement plan, you might consider an individual retirement account (IRA), a 403(b) plan or a 457(b) plan. These are individual investment accounts that can supplement the retirement income that you will receive from STRS Ohio. These accounts each have their own plan characteristics, such as maximum annual contribution limits, withdrawal limitations and fees. A financial advisor can help you determine if one of these plans is right for you. The Ohio Public Employees Deferred Compensation Program is a supplemental 457(b) retirement plan that is available to all Ohio public employees. You can learn more about this option at www.ohio457.org.
Protect Yourself From Scams and Hackers
STRS Ohio wants you to be safe from phone and online scams. Hackers and scammers seem to become more sophisticated in their approach every day. Beware of common phone scams that offer a free prize or ask for your bank account number, debit or credit card information or your Social Security number. These same tips apply to your email as well. The Federal Trade Commission’s Consumer Information portion of its website offers online security tips on phone scams, computer and laptop security, online scams, how to dispose of old computers and mobile devices and more. You can find this information at www.consumer.ftc.gov.
Active Member Arthur Lard to Serve on Retirement Board
Arthur Lard, a high school teacher from Portsmouth City Schools, will fill a contributing member seat on the board beginning Sept. 1. He was the only STRS Ohio contributing member to file enough completed petitions for the 2019 election. Since he was unopposed, in accordance with Ohio statute, no election was necessary. The term for this seat is Sept. 1, 2019, through Aug. 31, 2023. Board members receive no compensation for service on the board other than reimbursement for actual, necessary expenses.