Benefit Payment Options - What Works for Me?

Sep 26, 2023, 13:30 PM

When applying for retirement, you will elect how you will receive your monthly pension payments in retirement. MOSERS offers several benefit payment options, and each option has its own advantages and disadvantages, depending on your own individual preferences, plans, financial situation, and the needs of those who are financially dependent on you.

 Let’s look at a few different scenarios. Please note that these are fictional examples to help illustrate the different options. Depending on the plan you are in, the benefit payment options may vary slightly. We encourage you to consult with a MOSERS benefit counselor and carefully review your options before making a final election.

Please view our Benefit Payment Options page for more information about each option and how they differ by plan.

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Tom – MSEP 2011, Joint & 50% Survivor

Tom is a member of MSEP 2011, who is married to Maria and wants to ensure she will be taken care of in the event of his passing. Maria is retired and already has a pension from her position working as a teacher. He chooses the Joint & 50% Survivor option. Tom takes a reduction to his monthly payment for the rest of his life in order to provide this potential survivor benefit, but upon his passing, Maria will receive a monthly payment for the rest of her life. Maria’s monthly payment will be 50% of whatever Tom was receiving when he died, including cost-of-living adjustments (COLAs), but excluding any temporary benefits. Tom feels secure knowing Maria will be financially supported even after he is gone.


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Sarah – MSEP 2000, Life Income Annuity

Sarah is a member of MSEP 2000, and is married but has been diagnosed with an illness that could shorten her life span. She wants to maximize her benefit payments while she is still alive so she can travel the world with her husband, Andre, so she chooses the Life Income Annuity option. This provides her with an unreduced monthly pension payment for the rest of her life. Sarah knows that Andre has a good pension and will be financially secure without her help. Sarah is comforted knowing that she can rely on a steady income during her remaining time.


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Jose – MSEP 2011, Life Income with 180 Guaranteed Payments

Jose is single and has no children, but he does have a nephew that he is very close to. Jose has decided to retire early due to health reasons and is concerned about living long enough to see his nephew get married. He chooses the Life Income with 180 Guaranteed Payments option, because he wants to make sure that if he passes before the wedding, he can still give his nephew something. If he lives on, he will still receive a reduced monthly pension payment for every month of his life. He has selected his nephew as the beneficiary, meaning, that if Jose passes before all 180 payments have been made, his nephew will receive any remaining payments of the 180 guaranteed payments.


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Bob - MSEP, Joint & 100% Survivor

Bob is a member of MSEP and is married Sasha. As Bob approaches retirement, he wants to make sure that Sasha will be taken care of if anything happens to him. After carefully reviewing all the available benefit payment options, Bob decides to elect the Joint & 100% Survivor option. Under this option, when Bob passes, Sasha will continue to receive 100% of his monthly pension payment, including any COLAs, for the rest of her life. Bob knows that this option will provide the most financial security for Sasha since she has no other retirement benefits of her own.


In the end, each of these individuals found a MOSERS benefit payment option that worked best for their unique circumstances.

Want to know more? Visit our Benefit Payment Options page for additional information.


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