Jeff Pabst, CRC
One of the common misunderstandings of your LAGERS benefit is that you must work with your employer until retirement to receive a monthly benefit. Your LAGERS benefit is more portable than you may think, and whether you plan to be a career local government employee in Missouri or plan to move on in the future, you have many options for taking your LAGERS benefit with you throughout your career.
I plan to leave my current LAGERS employer and go to another LAGERS employer.
When moving directly from one LAGERS employer to another, there is not much you need to do in regards to ‘transferring’ your LAGERS benefit. Upon being hired at the new LAGERS employer, they will complete an enrollment, and you will have a separate account with the new employer. If you are not vested (60 months of service) at the time you change jobs, not to worry. Vesting in LAGERS is system-wide, and your service from your previous employer will count towards your overall vesting. At retirement, we will do two (or more) calculations for your benefits, add the benefit amounts together, and pay you one monthly benefit.
I’m leaving the LAGERS system, but may come back in the future.
If you are leaving the LAGERS system, but believe you may return in the future, you can simply leave your LAGERS benefit untouched. When you reemploy in the future, your benefit will simply pick back up where you left off. If you are not vested when you leave employment, be sure to return to LAGERS covered employment within 10 years to preserve your previous service. If you elect to take a refund or payout when you leave employment, you are forfeiting your previous service, and upon reemployment, you will begin with zero service credit.
While you are between LAGERS employers, you can participate in whatever retirement plan your employer offers, and it can work in tandem with LAGERS upon retirement.
I’m leaving the LAGERS system, and don’t plan to return to LAGERS covered employment.
While some public workers will remain in public service in Missouri for their entire careers, others choose at some point to move on. When this happens, there are several options when it comes to your accrued LAGERS benefit. If you have less than five years of service in LAGERS when you leave, you can receive your member contributions (if you have any), plus interest, by applying for a refund. If you were vested when you left, but have less than ten years of LAGERS service and you are more than 10 years from your normal retirement age, you can also apply for a lump sum payout of your benefit. You can roll this payment into any new retirement plan at your new employer, or you can simply take the payment directly. This is a great option for members who have smaller benefit accruals in LAGERS and wish to completely transfer their benefit into a new plan. You also have the option to let your LAGERS benefit sit with LAGERS and begin your monthly benefit at retirement age in addition to any other retirement benefits you earn at future employers.
If you ever do leave employment with your LAGERS employer, just remember that there are many options that provide flexibility to take your LAGERS benefit with you. If you have any questions about your options, please do not hesitate to contact our office.