Welcome to CalSTRS

					                                                                C a l i f o r n i a S t a t e Te a c h e r s ’
                                                                              Retirement System

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

                                                                              2007 – 2008
   The California
   State Teachers’
   Retirement System
   has more than
   795,000 active and
   inactive members
   and disburses
   monthly benefits to
   more than 207,000
   retired or disabled
   members and
   their survivors.
   Your retirement
   system, established
   in 1913 for
   California public
   school educators,
   has a long history    Welcome to CalSTRS
   of financial
   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.
                                                                                                        A defined
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
Supplement Account?
   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
Supplement account.

                                                                                                        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
                                                                            Medicare coverage.
    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
Part-Time Educators…
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.
                                                                                                    or adjunct
                                                    administrative fees.)
                                                • 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
                                                    investment experience?
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
                                                                              PRSRT STD
                                                                             U.S. POSTAGE
                                                                            PERMIT NO. 25
                                                                           SACRAMENTO, CA
CalSTRS Resources
Web sites     www.CalSTRS.com
              Click Contact Us to e-mail

Call          800-228-5453
              7 a.m. to 6 p.m.
              Monday through Friday
              TTY 916-229-3541
              Home Loan Program
              Voluntary Investment Program

Write         CalSTRS
              P Box 15275
              Sacramento, CA 95851-0275

Fax           916-229-3879

Visit         Member Services
              7919 Folsom Boulevard
              Sacramento, CA 95826

                                                 Welcome to
                                                 your retirement system

                                                             We are your partner
                                                          in building your secure
                                                                  financial future.
                                             Open to learn about benefits and services
                                                   designed to support you throughout
                                                                your education career.

            5/07 COM1779

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