Chapters

00:00 Choosing the Right Retirement Month

01:31 Popular Retirement Months

02:28 Insurance Factors

03:10 Financial Factors

04:01 Goal Factors

04:54 Relationship Factors

05:27 Action Items

06:01 Next Video Preview and Disclaimer

Transcript

Hi everyone, I'm Ryan Earley, vested PERS member, former school finance officer, and host of the PERS Pro YouTube channel. Most PERS members spend years counting down to the age they are eligible to retire, but have they given much thought about the specific month they should walk out the door? Let's dive in.

In Mississippi, your PERS retirement effective date will generally be the first of the month. While you have the freedom to choose any of the 12 months in a year, be mindful of deadlines and timelines. First of the month: For active members, your retirement becomes effective the first day of the month after you terminate your current employment and PERS receives your completed pre-application from your employer. For inactive members, your retirement also becomes effective the first day of the month after PERS receives your completed application directly from you. 90-day window: You must submit your pre-application, that's Form 9A, service. To set your date and all other forms must be filed within 90 days of your pre-application to maintain that effective date you've chosen. Termination: You must actually withdraw from service before your benefits can begin. Special note, that employers really appreciate when retirees submit their paperwork early and retirees will really appreciate the extra attention they receive from their employer during this process.

Why do some months see a stampede of retirees while others are relatively quiet? It usually comes down to the employer. July 1st, state fiscal year: This is a common date for school district employees and state agency workers because it aligns with their fiscal years, which is July 1st to June 30th. This date allows you to complete a full contract year and maximize your final year's salary for your high four average. When I was at Jackson County School District, we got a large number of retirement applications the months of January through March for June 1st and July 1st retirements. other common retirement dates. January 1st, which aligns with the calendar year. October 1st, which aligns with the local fiscal year, this is common for county and city governments. Contractual end dates: If you are a teacher, your contract may specify an end date in May, making June 1st a common retirement date for this population of PERS members.

Your health and insurance coverage are often the tail that wags the dog when picking a month. Consider these timing triggers. Medicare eligibility: You are generally eligible for Medicare on the first of the month you turn 65. Retiring the same month you transition to Medicare can simplify your insurance handoff. Deductible reset: Most insurance deductibles reset on January 1st. If you've already met your family deductible for the year, retiring in December could maximize that deductible. Qualifying events: Retirement is a qualifying life event allowing you to enroll in a new health plan outside of the standard open enrollment period of your spouse or the healthcare marketplace.

Beyond your monthly benefit payment from PERS, the month you retire also affects the taxes you pay and your future COLA you receive. COLA WAITING PERIOD To receive your first 3 % COLA, you must be retired for one full fiscal year, that's according to the state's fiscal year, July 1st to June 30th. FEDERAL INCOME TAX Retiring mid-year might keep you in a lower marginal tax bracket for that final working year. FASFA AND COLLEGE AID Retirement status can change your income on financial aid forms, potentially increasing or decreasing aid for children in college depending on if your income you draw in retirement is higher or lower than while you were working. Unused leave: Accumulating additional leave and turning in unused leave can add months or even years to your service credit, potentially bumping your lifetime benefit payment.

Retirement isn't just a math problem, it's a life transition. Sometimes the month is chosen for you by your goals. Finish your goal: Did you set a goal out for yourself that you want to see through, like raising achievement in the classroom to the highest level or growth it's ever been? Staying until the end of the academic year will be required and dictate your retirement month. Caregiving: Are you retiring to help with a new grandchild or an aging parent? Their needs often dictate the start of your retirement. Second career: If you accepted a new job outside of PERS, their orientation date might force you to retire a certain month. The bucket list: is there a once in a lifetime event or a specific travel window like the Winter Olympics or an international festival or solar eclipse that you've been waiting 30 years for? If so, that event could determine the last possible month you can retire.

Finally, don't forget the social nest egg we discussed in our last video. Coordinating spousal exits: Are you and your spouse trying to retire in the same month to start your honeymoon phase together? The sports season: If your child or grandchild plays collegiate or high school sports, retiring in August might be the only way to catch every weeknight game or Saturday kickoff several states away. Solo time: Some retirees choose to retire a few months before their spouse to get the house organized and enjoy a little quiet time before the 24-7 exposure begins.

If you are within a year of retirement, here are your action items for today. Calculate your difference in benefits. Calculate how the month you retire impacts your unused leave, lifetime maximum benefit, future COLA, and monthly health insurance costs. The deductible audit. Look at your 2026 medical spending and planned surgeries. Does it make more sense to retire later in the year? FAFSA review: if you have kids in college, talk to a financial aid officer about how a mid-year retirement change in income might affect their Pell grants or loans.

Make sure you spend as much time picking the ideal month to retire as you do the ideal year to retire. In our next video, we'll look at the different ways a PERS member can accumulate service credit to reach their retirement goal faster. Please make sure you're subscribed so you don't miss this and other videos in our new retirement series. If you found this video helpful, can thank me by hitting the thumbs up button and sharing it with other PERS members. If you have a follow-up question about PERS or anything else related to personal finance, please visit our website at perspro.ms and submit your question or topic for a future episode. Thank you for your valuable public service to the state of Mississippi. We'll see you next time.

Disclaimer, this video is for educational and informational purposes only. Neither the host nor this YouTube channel are officially affiliated with, endorsed by, or sponsored by the Public Employees Retirement System of Mississippi. Always consult a qualified professional for personal advice specific to your situation.