Teachers' Retirement System of Louisiana (TRSL) FAQ
Who administers this plan?
A Board of Trustees comprised of 12 elected members and four ex officio members governs TRSL. Members include representatives from each of the state’s seven congressional districts, two trustees who represent retired teachers, one representative for employees paid the school food service funds, one representative for employees of state colleges and universities, and one representative who is employed as a parish or city superintendent of schools. The four ex-officio members include the State Superintendent of Education, the State Treasurer, and the chairmen of the retirement committees of the Louisiana House of Representatives and the Louisiana Senate.
What is the difference between a “Defined Benefit Plan” and a “Defined Contribution Plan”?
TRSL is called a defined plan because it is a plan wherein GSU and you, as an employee, make contributions into a pool of funds from which you receive a retirement income based on a benefit formula. The amount of benefit is determined by the years of service and the average salary for the 36 highest successive months of earnings.
A defined contribution plan is a retirement annuity contract funded by employee and employer contributions. Benefits are based on the value of the account when you elect to retire and are paid in the form of a lifetime income. (See the section on Optional Retirement Plan.)
Who is eligible for membership in TRSL?
You are eligible for membership if you are a faculty employee with an appointment of one full year or more at 50 percent FTE or greater, or if you are a unclassified staff member with an appointment of one full year or more at 51 percent FTE or greater. If you are a nonresident alien with a J or F visa, you are not eligible for membership in a retirement plan.
Do I have to contribute to the plan?
Yes. Your share is 8 percent of gross salary. GSU contributes pays an employer contribution that is determined each year based on an actuarial formula, also set by state law. The rate is subject to change July 1 of each year.
Can my TRSL Contribution be refunded?
You may obtain a refund of your employee contributions, upon request, at termination of employment. The earliest you may receive your refund is 90 days after your termination date. You may obtain the application for refund from the Department of Human Resources, 242 Long-Jones Hall or at http://www.trsl.org/main/general.php?section=general&page=forms_by_subject.
How long must I participate to be vested?
You must have at least 10 years of service to receive a vested retirement benefit when 60 years of age.
If I participate in TRSL, Do I also contribute to Social Security?
No, if you contribute to TRSL, you do not participate in Social Security; however, if you were hired after April 1, 1986, you must pay the Medicare portion of the FICA tax (1.45 percent of salary)
Should I designate a beneficiary?
Yes, it is important to designate a person to receive benefits in the event of your death prior to retirement?
When May I retire?
Retirement eligibility is determined by your age and years of service. The various combinations of service and age eligibility requirements are as follows:
- 10 years of service, or more, at age 60 or later
- 20 years of service or more, less than age 65
- 25 years of service, or more, at age 55 or later
- 30 years of service, or more, regardless of age
- 20 years of service at age 65, excluding military service purchased under provisions of L.R.S. 11:153 after September 10, 1982.
What determines the amount of my benefit?
Your retirement benefit is determined by a formula, as follows:
Years of Service Credit x Formula Percentage X High Three-Year Salary = Retirement benefit
The applicable formula percentages are:
|10 years of service, or more, at age 60 or later||2%|
|20 years of service, or more, less than age 65||2%|
|25 years of service, or more, at 55 or later||2.5%|
|30 years of service, or more, regardless of age||2.5%|
|20 years of service at age 65||2.5%*|
|*Exclusive of purchased military service.|
[Years of Service] x [Formula %] x [3-Year Average
Salary] = Benefit
[25 years of service] x [0.025 rate] x [$30,000] = $18,750 benefit
[30 years of service] x [0.025 rate] x [$30,000] = $22,500 benefit
Will retirement benefits increase after I retire?
Although not guaranteed, periodic cost-of-living adjustments may be made to your retirement benefit.
What if I become disabled?
If you are an employee with less than five years of service, you are not eligible for disability benefits; however, you may receive a refund of your contributions to the plan at the time of termination. If you have more than five years of service, you are eligible to apply for lifetime disability benefits.
What if die before I retire?
If you have less than five years of service, you are not eligible for survivor’s benefits; however, your beneficiary may receive a refund of your contributions to the plan at the time of your death. For employees with five but less than 10 years of service, limited benefits are available if minor children are involved. For employees with 10 or more years of service, the beneficiary may receive benefits for life.
If I terminate employment before retirement, what benefits are available?
If you have less than 10 years of service credit at the time of termination, you may apply for a refund of your contributions to the system. Employees with 10 years or more service credit will be eligible to receive a benefit at the age of 60. This is commonly called a vested retirement benefit.
What is TRSL’s drop program?
The Deferred Retirement Option Plan (DROP) is an optional program in which you, as a member of TRSL, choose to freeze your regular monthly retirement benefit and have this benefit deposited each month in a special account at TRSL while you continue to work and draw a salary from a TRSL employer.
When may I enter the drop program?
You may participate in DROP for a maximum of three years beginning on the date you first become eligible to retire and ending no later than three years and 60 days later.
You are eligible to participate in DROP based on 2.5 percent of your salary per year of service credit if you have 30 years of service, 25 years of service and at least age 55; or at least age 65 with 20 years of service. To qualify for a benefit based on 2 percent of salary per year of service credit, you must be at least age 60 with 10 years of service.
Once DROP participation begins, the decision to participate is irrevocable and the period of participation cannot be extended. The participation may be shortened only by termination of employment or by death.
Will I continue to contribute to TRSL?
No, the retirement contributions that are normally deducted from your salary are discontinued while you are participating in DROP. It may be possible to put this money into an alternative tax-sheltered supplemental retirement account while you are in DROP. See the Supplemental Retirement Account for details on tax sheltering a portion of your salary.
What Will Happen When The Drop Period Is Over?
At the end of DROP, you may either terminate employment and begin regular retirement or continue working. If you retire, you may begin withdrawing funds from the DROP account. If you continue working, you cannot withdraw from the DROP account during employment, and employee and employer contributions to TRSL must resume. You earn additional service credit or continued employment.
When you elect to retire following DROP participation, the additional service and the unused sick and annual leave balances will be converted to additional service credit to increase your retirement benefit.
For complete details concerning DROP, see http://trsl.org/uploads/File/Brochures/DROPhandbk.pdf.
WHAT IS TRSL ILSB?
ILSB (Initial Lump Sum Benefit), formerly known as Option 5, provides a one-time lump-sum payment of up to 36 months of the regular maximum monthly benefit that is paid if you are a retiring member who has not participated in DROP. Your regular monthly retirement benefit and that of your beneficiary will then be reduced on an actuarial basis. The one-time lump-sum payment may:
- Be directly rolled over into an individual retirement account (IRA) or other qualified plan:
- Remain in an account at TRSL that earns interest at one-half of one percent less than TRSL’s actuarial realized rate of return; or
- Be paid directly to you, subject to any state and federal taxes and
early withdrawal penalties due. Before making a decision about ILSB, you
should carefully consider whether the reduced monthly lifetime benefit you
receive under ILSB would be enough to meet future financial obligations.
Additional information on ILSB is presented in the TRSL handbook.