When it comes to planning for your retirement, it can be hard to know if you’re on the right track. Although LAGERS is designed to be the foundation of your retirement security, your retirement will likely include income from more than just your LAGERS benefit. Here are a few things to think about as you make your financial plans for the future:
How does my LAGERS benefit work?
Your LAGERS benefit is designed to pay a pre-determined benefit every month in retirement for your lifetime. Unlike a defined contribution plan, such as a 401(k), you do not have to direct investments in your account, rather, contributions are pooled and invested in one portfolio that is managed by LAGERS investment experts. Returns from investments are used to guarantee your monthly benefit and provide an annual cost-of-living adjustment that is approved by the LAGERS Board of Trustees each year.
Why could my benefit not be enough income in retirement?
Although all LAGERS’ retirees receive a monthly benefit, your specific benefit amount is determined by multiple factors including your employer’s benefit multiplier, your length of service and your final average salary. The longer you work and the more you earn, the greater your monthly benefit in retirement. If you are worried your benefit won’t be enough, you can consider working longer or supplementing your retirement savings outside of LAGERS.
Tools to prepare for the future
To ensure you’re on track to meet your expectations for retirement, calculate your benefit income early in your career. Pay attention to your LAGERS annual statements and run a benefit estimate using the myLAGERS online web tool. There are also retirement calculators such as the AARP online retirement calculator to help you determine what your financial future will look like.
Remember to take advantage of any deferred compensation programs your employer might offer and utilize other personal savings and financial planning tools to maximize your income in retirement.
Additional questions about your LAGERS benefits? Reach out to our benefits team at [email protected].
