October 8, 2008

Georgia TRS Contribution Rates to Rise in July 2009

In September, the Georgia TRS announced that the employee and employer contribution rates would rise starting July 1, 2009. The new rates will be:
  • Employee - 5.25% from the old rate of 5.00%
  • Employer - 9.74% from the old rate of 9.28%
While this may be news, the actual contribution change will be very, very small.

For example, under the current rates (5.00% and 9.28%), an educator making $50,000 a year would make contributions of $2,500 (annually), and the employer would contribute $4,640.

Under the new rates (5.25% and 9.74%), an educator making $50,000 a year would make contributions of $2,625 (annually) - only $125 more. This would have a net effect on your paycheck of about $7.30 per MONTH. The employer will have contributions of $4,870 - $230 more.

The reason for the change goes back to the performance of the stock market since 2001. TRS has an actuary determine the liabilities versus assets of the plan and calculate the difference that must be made up. The raise in contributions will help bring the plan back in line.

If you wish to know more, please read the letter from the TRS Executive Director Jeffrey L. Ezell by clicking here.

Next on the agenda... writing letters about the proposed TRS Cost of Living Adjustment (COLA) change...

3 comments:

Anonymous said...

I was non-renewed due to the economy. I am receiving teacher retirement for working as a teacher. I have been approved for the unemployment insurance benefits, but now, my local BOE is appealing it. They are saying that since I did not contribute 50% of my retirement, I should be ineligible. I don't think it can be done as in GA the amount contributed by a member of TRS is set by Ga law 505.01. No teacher in Ga has an option to contribute more than the mandatory 5.25%. Does anyone have any comments on this for me?

Robby Schultz said...

I am sorry, but I unfortunately do not know anything about this. You are correct in that you cannot contribute more to your TRS account.

I believe what the BOE is arguing though is that you did not make 50% of the contributions to the TRS account. Your employer also makes contributions, so it is about 1/3 from you and 2/3 from them.

I would definitely be interested in knowing what the outcome is here.

Thanks,
Robby

david said...

Did we ever get an answer on this? I am in the same boat. I was forced out with 29 years. Had to buy 35k in air time and 4 years out of state at 10k per year. It ate up my Sup Retirement fund. Now they say no unemployment.

David