Taking Full Advantage of Your Available Pension Benefits
As many of you are aware, while you work as a police officer in your city, at the end of your career you are entitled to benefits through the Ohio Police & Fire Pension Fund. Most officers and fireman are aware of the basic benefits but many don’t know how to take advantage of the great pension system we have.
Minimum benefits start at 25 years of service. Whether you fall under the old benefit structure of your three years highest average (benchmarked) or your highest five years average it is important to know the difference in working beyond 25 years. After 25 years of working, should you decide to work beyond that date you will receive a multiplier of 1.5% per year of your average annual salary to a maximum amount of 72% after 33 years of service.
After 25 years of service, you also have the option of entering the deferred retirement option program (you must meet age requirements of 48 under the old system or 52 under the new system). The deferred retirement option program allows you to freeze your benefits and have those benefits deposited into a tax deferred account upon entering into a service retirement (maximum eight years).
To maximize the benefit, if you were to work until you received the maximum of 72% and enter the deferred retirement option program completing it until the maximum of eight years you would be entitled to a very optimal retirement program. Purchasing of prior service also counts toward the years of service you work. You are also entitled to receive benefits that are any combination of 25 plus years of service and the minimum required time in the deferred retirement option program (minimum 5 years to collect interest).
These are only a portion of the benefits available that most members are aware of. You are also entitled to participate in a deferred compensation program. The most popular program is the Ohio Deferred Compensation Program. You can contribute a maximum of $17,500 for 2014. If you were able to contribute just a small amount per day throughout your career and balanced a portfolio along the way, you would have a nice little savings account upon your retirement. Should a deferred compensation program not be of your liking you can contribute to an Individual Retirement Account (Roth or Traditional) which contribution limits of $6,500 for 2014.
Currently the Ohio Police & Fire Pension Fund also offers health care benefits at competitive rates for the member (spouse and children make the cost a lot higher). OP&F covers 75% of the benefit cost for the participant. The fund also offers prescription, dental and vision coverage.
I encourage everyone to revisit the benefits you have available to you and to take advantage of the full complement of options. Please visit www.op-f.org to review the retirement benefits you have available to you. You can download or request the service retirement brochure which explains your benefits in greater detail.
Scott Huff, Trustee
Ohio Police & Fire Pension Fund