C a l i f o r n i a S t a t e Te a c h e r s ’
Welcome to CalSTRS
B E N E F I T S A N D S E RV I C E S F O R F U L L -T I M E
A N D PA R T-T I M E E D U C ATO R S
2007 – 2008
has more than
795,000 active and
monthly benefits to
more than 207,000
retired or disabled
in 1913 for
has a long history Welcome to CalSTRS
security. CalSTRS Throughout your career in California’s part-time employees. You may choose to
is administered public school system and in the years to become a Defined Benefit Program member
by the 12- follow, you and your dependents will be at any time in your career. Your employer
member Teachers’ eligible for valuable CalSTRS services and must offer you the CalSTRS Defined Benefit
Retirement Board, benefits. Many of your questions about those Program and an alternative program if you
which includes services and benefits will be answered here. are not required to belong to the Defined
representatives Benefit Program. Districts may offer one or
from K–12 and Basics for Full-Time more alternative programs such as CalSTRS
community college and Part-Time Educators Cash Balance Benefit Program, Social
education, retired Security or another program.
Whether you are a full- or part-time
members and Here, we have outlined some basics about
educator, the California State Teachers’
the public. the CalSTRS Cash Balance Benefit Program.
Retirement System provides you benefits and
The information services. This guide outlines the essential For information about alternative programs,
here is correct as benefits in the CalSTRS Defined Benefit and please see your employer.
of January 2007. Cash Balance Benefit programs. This is a general guide. For more detailed
If differences Membership in the Defined Benefit information on the Defined Benefit and Cash
appear between program is required for full-time educators. Balance Benefit programs, see the Member
the law and this For part-time educators, mandatory Handbook, which you can get from
brochure, the law Defined Benefit Program membership your employer. You may also order it from
must prevail. requirements vary, depending upon an www.CalSTRS.com or by calling 800-228-5453.
individual’s employment status and whether In addition, visit our Web site for a wealth of
or not the CalSTRS Cash Balance Benefit information about CalSTRS programs, benefits
Program is offered by the employer to their and services and links to other resources.
2 • Welcome to CalSTRS
Defined Benefit Program
My retirement is a “defined benefit” When will I be eligible
program. What is that? for retirement benefits?
A defined benefit program guarantees a This eligibility, known as vesting, occurs
lifetime benefit to you (and to your survivors, when you have five years of service credit. You
if you choose), regardless of the amount of can retire as early as age 50 if you have at least
funds you have contributed to your account. 30 years of service credit. You can retire at age
55 with five years of service credit.
Am I required to belong to the
CalSTRS Defined Benefit Program? How do I know how much
Yes. If you are a full-time California I’ll receive when I retire?
public school K–12 teacher or community Your Defined Benefit retirement benefit
college instructor you are required to belong is determined by a formula set by law; it
to CalSTRS. Some part-time and substitute is based on your age at retirement, highest
educators are required to belong to the average annual compensation and amount of
Defined Benefit Program depending upon service credit. Your monthly Defined Benefit
their individual employment status and retirement benefit does not depend on your
whether or not the CalSTRS Cash Balance accumulated contributions. For example, a
Benefit Program is offered by their employer. teacher who is 61 years old and has 29 years
of service credit will receive 62 percent of his
How much do I pay into the DB Program? or her working salary in retirement.
Eight percent of your salary is automatically To estimate your benefit, visit
withheld from your paycheck. Your employer www.CalSTRS.com and click on Calculators.
contributes an amount equal to 8.25 percent In addition, starting at age 45, you will be benefit program
of your salary to help pay benefits. mailed an annual estimate of your projected guarantees a
What is a Defined Benefit Defined Benefit and Defined Benefit
Supplement retirement benefit in your lifetime benefit
One-fourth of your CalSTRS payroll Retirement Progress Report (see below). no matter the
contributions will be allocated to your How will I know how much amount in your
Defined Benefit Supplemental account is in my retirement account?
through 2010. In addition, if you earn more account.
CalSTRS sends you an Annual Statement
than one year of service credit in a school of Account in a brochure called Retirement
year, your contributions and most of the Progress Report. It shows your Defined
employer contributions from your earnings Benefit contributions, interest accrued and
in excess of one year will be allocated to total service credit. This statement will also
your Defined Benefit Supplement account. show how much is in your Defined Benefit
Your funds will earn interest and be available Supplement account. If you see a discrepancy
to you when you begin to take a Defined between this statement and your records, talk
Benefit monthly benefit or one year after you to your employer right away.
terminate CalSTRS-covered employment.
You can receive your funds in a lump sum
or in a monthly payment if you are receiving
a monthly Defined Benefit payment and
have at least $3,500 in your Defined Benefit
Welcome to CalSTRS • 3
Will CalSTRS pay benefits to my survivors?
Yes. Depending on your amount of service
credit and if you die before or after retirement,
your survivor could receive a refund of the
balance in your retirement account, a one-
time amount and/or a monthly benefit.
As soon as you are hired, complete
the One-Time Death Benefit Recipient form
provided by your employer. You can also print
this form from www.CalSTRS.com or call
us at 800-228-5453 to order it. Remember
to update this recipient designation if your
choice of recipient changes during your career.
In addition to the recipient, you can select
an option beneficiary when you are eligible to
retire. The option beneficiary will receive a
lifetime monthly benefit when you die. Your
Are there other ways to add service credit? recipient and your option beneficiary do not
As soon as Yes. You may buy service credit for have to be the same person.
you are hired, some types of service in out-of-state public
schools, the military, Red Cross or Job Corps, If I leave teaching, can I keep
complete a maternity or paternity leave and certain other my contributions in CalSTRS?
One-Time teaching jobs. In addition, once you have Yes. This is especially valuable if you
at least five years of CalSTRS service credit, might return to teaching later or if you
Death Benefit you may buy up to five years of nonqualified already have at least five years of service
Recipient form. service credit, also called “air time.” credit. If you return to teaching, it will be
expensive to recover service credit if you
Am I entitled to disability benefits? had a refund of your CalSTRS account.
Yes. In general, once you are vested and Even if you do not return to teaching, if you
meet the eligibility requirements, disability have at least five years of service credit, you
benefits will be half your highest average will receive a lifetime monthly benefit from
annual salary for life or as long as you are CalSTRS when you retire.
disabled, plus another 10 percent for each
eligible child (up to a total of 90 percent) If I leave teaching, can I
until the child reaches age 21. withdraw my contributions?
If you leave teaching you can withdraw
your own contributions and interest (partial
refunds are not allowed). However, if you
withdraw your contributions, you terminate
your CalSTRS membership and benefit
eligibility. Please consider this carefully. It is
expensive if you later resume teaching and
want to recover this service credit. You cannot
withdraw employer contributions.
See more Defined Benefit Program
information on page 6.
4 • Welcome to CalSTRS
Cash Balance Benefit Program
What is the Cash Balance additional credits (see above). This amount is
Benefit Program? paid to your named beneficiary. If you have
It is CalSTRS’ alternative retirement at least $3,500 in your account, your named
program that employers may choose to offer beneficiary may choose to receive a monthly
for part-time educators. benefit.
When will I be vested? Can I continue with Cash Balance if I move
You are immediately vested. You do not to another district or become a member
have to wait to become eligible for benefits. of the Defined Benefit Program?
You do not
In most cases, you can continue as a Cash
How much must my employer Balance participant if you move to another have to wait
and I contribute? district that offers the program and continue
Your employer must contribute at least 4 to become
part-time employment. If you become a
percent of the salary you earn. You usually member of the Defined Benefit Program and eligible for
pay 4 percent. However, your contribution are no longer contributing to Cash Balance, you
rate may be bargained with your employer. benefits.
may transfer your Cash Balance funds into the
Is the interest rate guaranteed? Defined Benefit Program and receive Defined
Yes. It is set by the Teachers’ Retirement Benefit credit for your Cash Balance service.
Board based on the 30-year Treasury rate. What are my options if I leave
The interest rate for the 2007-2008 fiscal public school employment?
year is 5.25 percent. You have two options:
How do I know how much I have • Leave your contributions on deposit
in my account? with CalSTRS.
You will receive an annual statement • Withdraw your funds or roll them over to
showing the balances of your contributions, another eligible retirement plan or IRA. If
your employers’ contributions and interest you decide to withdraw the funds, you’ll
credited to your account. have to wait six months after you terminate
employment. If you withdraw the funds
Am I entitled to disability benefits? and then return to CalSTRS-covered
Yes. Normal distribution is a lump- employment, you won’t be able to
sum benefit. This amount is the sum of withdraw funds again for five years.
your contributions, interest and additional
credits in your and your employer What happens when I retire?
accounts. (Please see the Choose a First- • If you have less than $3,500 in your
Class Plan for Your Future brochure for account, you can take your and your
details about additional credit.) If you employer’s contribution, plus interest, in a
have at least $3,500 in your account, you lump sum or
may elect to receive a monthly benefit. • If you have more than $3,500 in your
account, you can choose to receive a
Will CalSTRS pay benefits to my survivors? monthly benefit over a specific period of
Yes. Normal distribution is a lump- time or over your lifetime and, under some
sum benefit, which consists of your and circumstances, the lifetime of a beneficiary.
your employer’s contributions, interest and
Welcome to CalSTRS • 5
Your CalSTRS Extras
CalSTRS Web Resources
www.CalSTRS.com and myCalSTRS
Visit www.CalSTRS.com to find much more information about
CalSTRS, including details of programs and benefits, news
on legislation that could affect CalSTRS and several benefits
calculators. You can also e-mail CalSTRS through Contact Us.
By registering at myCalSTRS at www.CalSTRS.com, you can update Defined Benefit Program
your address and phone number and view your Annual Statement
and Cash Balance Program
of Account, one-time death benefit recipient and option beneficiary
and tax withholding information. You can also send and receive What about Social Security payments?
confidential information about your account. You do not pay into Social Security on
your public school employment earnings.
403bCompare.com However, if you or your spouse otherwise
A valuable tool in helping choose an optional retirement savings plan qualifies for Social Security, that monthly
is 403bCompare.com. Created and managed by CalSTRS, this is an check may be reduced because of the
online information bank featuring detailed and objective information federal Windfall Elimination Provision
about experience, features and fees of vendors and products or Government Pension Offset. For more
available from your employer. information, contact the Social Security
Administration at www.SSA.gov or call
CalSTRS Home Loan Program 800-772-1213. Your CalSTRS benefit will not
Members looking for a fixed-rate, first-mortgage home loan will be reduced if you receive Social Security.
want to check out this program. Several loan options are available
for a conventional home purchase or refinance loan. See What about Medicare?
www.CalSTRS.com for current interest rates and approved lenders You and your employer each pay
or call 866-384-4457. 1.45 percent of your wages toward
Voluntary Investment Program
If your district participates in this 403(b) program, you can set Does CalSTRS provide health
benefits after retirement?
aside even more retirement funds through tax-deferred savings. The
No. Health benefits depend on your
Teachers’ Retirement Board oversees the VIP’s competitively priced
district’s agreement with your employee
investment options. For more information, visit www.CalSTRS.com
bargaining unit. Ask your employer.
or call 800-699-4032.
Does CalSTRS assist me in
Benefits Counseling and Workshops retirement financial planning?
CalSTRS-trained counselors can help you plan for retirement. They To help you develop a plan to build wealth
provide retirement and disability benefit estimates, as well as for your future, CalSTRS offers free financial
information about CalSTRS benefit programs. Counselors are available education workshops. To register, visit
throughout the state for one-on-one or telephone interviews. www.CalSTRS.com or contact your local
Counselors also conduct free workshops designed to provide you benefits counseling office.
with the knowledge and confidence to help you plan for a successful
Can I save in a tax-deferred plan
retirement. To find a benefits counselor or workshop near you, through payroll deduction with CalSTRS?
visit www.CalSTRS.com and click on Members, then Counseling/ Most employees are eligible to participate
Workshops, or call 800-228-5453. in the CalSTRS Voluntary Investment
(800) 228-5453 Program, a 403(b) program that offers 20
well-diversified investment options and
Representatives are available to answer your telephone questions
retirement financial planning advice.
weekdays from 7 a.m. to 6 p.m.
To order a CalSTRS VIP brochure, visit
www.CalSTRS.com or call 800-699-4032.
6 • Welcome to CalSTRS
Choosing Between the Defined Benefit Program
and an Alternative Retirement Program
As a part-time or adjunct employee, • Are comfortable with the contribution
you have a choice of retirement programs. rate, which is typically 4 percent of your
Employers must offer the Defined Benefit salary, depending on your local bargaining
Program and an alternative program to all agreement. This rate is matched by your
adjunct employees or part-time educators employer.
hired to work less than 50 percent of the If your employer offers an alternative
full-time equivalent for a specific position. program (other than the Cash Balance
Districts can offer one or more of the Benefit Program) ask yourself:
following programs: • Does the plan offer a monthly benefit for
• CalSTRS Cash Balance Benefit Program life or is it a non-lifetime benefit based on
• Another program chosen by the district contributions and interest?
• Social Security • What is the contribution rate? Is it
Full-time employees are automatically matched by my employer?
enrolled in the CalSTRS Defined Benefit • Is there a vesting requirement?
Program. As a part-time employee, you may • Does the program charge administrative As a part-time
choose the Defined Benefit Program anytime fees? (Neither CalSTRS program charges
during your career.
• Is there a guaranteed annual interest rate? employee, you
How can I pick the plan that
works best for me? • Does the plan have a record of sound have a choice
You may want to choose the CalSTRS • How long do you have to wait to receive of retirement
Defined Benefit Program if you: your funds? programs.
• Plan to work as an educator in California
long enough to earn a benefit. Called For More Information
vesting, this occurs after you have five The available alternative programs vary
years of service credit with CalSTRS. widely by district, so we cannot describe every
This could take 10 years of half-time one. Check with your employer or the Social
employment. Security Administration to find out specifics
• Want a monthly benefit that provides a on the benefits offered.
specific amount that is known in advance For detailed information about part-time
and payable for life, one with benefits educators and the CalSTRS Defined Benefit
based on a set formula and not on the Program, see the Member Handbook. For
monies in your account. information about the Cash Balance Benefit
• Are comfortable contributing 8 percent of Program, see the Cash Balance Benefit Program
your pay towards your retirement. Your brochure. There are K-12 teachers and
employer contributes 8.25 percent. adjunct faculty versions. These publications
You may want to choose the are available from your district. You can view
Cash Balance Benefit Program if you: or order them from www.CalSTRS.com or
• Want a program that provides order by calling 800-228-5453.
immediate vesting. For more information about Social Security,
• Want a lump-sum or lifetime monthly visit www.SSA.gov or call 800-772-1213.
benefit based on monies credited to your
account with a guaranteed interest rate.
Welcome to CalSTRS • 7
PERMIT NO. 25
Web sites www.CalSTRS.com
Click Contact Us to e-mail
7 a.m. to 6 p.m.
Monday through Friday
Home Loan Program
Voluntary Investment Program
P Box 15275
Sacramento, CA 95851-0275
Visit Member Services
7919 Folsom Boulevard
Sacramento, CA 95826
your retirement system
We are your partner
in building your secure
Open to learn about benefits and services
designed to support you throughout
your education career.