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4 Reasons You Should Not Enter FRS DROP | Understanding the Florida Retirement System
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- เผยแพร่เมื่อ 12 ส.ค. 2024
- Don Anders from Anders Retirement & Investment Advisors discusses the 4 reasons you should NOT enter the Florida Retirement System DROP Program.
We also did a video on the reasons you should enter FRS DROP here: • The 3 Reasons You Shou...
If you'd like to book a complimentary phone consultation with one of our advisors you can click here: andersretirement.com/schedule...
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The reason about losing out on potential future raises is real. I have witnessed this first-hand where people entered DROP several years ago for a 5-year term then they received raises which, while increasing their salary, had no effect on the already calculated pension benefit nor their DROP account balance.
Another reason not to enter DROP is this; after this year's legislative changes you will now get 4% on your DROP account; the state invests your $$$ for you and determines the investment vehicles; let's say the vehicles they choose earn an average of 8% over your DROP period; you will get your 4% and the State will pocket the other 4%; you will not get it, only the 4%; you are actually loosing potential retirement income by being in DROP; a far better solution is leave after 30 years, start collecting your pension and invest it wherever you want, then go get a comparable job at a similar or higher salary elsewhere; your pension invested will most likely earn more than 4% and you will be in control of it, not the State.
Even some PT jobs, plus the pension, would earn more than Im are now, lol.
Thanks for the negatives...one applied to me..and going to wait for the salary increase.
Thank you for the video. Come January 2025, I will reach 11 years of service in the FRS. I have always been in the pension plan since being hired. I am 53 years old. I am thinking about possibly leaving the FRS system all together after the school year ends in 2025 and will potentially be self-employed. Would I have to switch to the investment plan so that I could take that benefit and roll it into a Roth IRA, since I will need to save for my own retirement? Thank you.
Fyi if you work more than 30 years or past age 30 your multiplier goes up. Age 65 gets 1.68 times years of service. 33 years gets 1.68 times 33.
Do you have any videos like this but for High-Risk FRS members ?
Remember, your COLA on your retirement is decreasing every month you do over 30 years. Although there has been legislation to return it to 3%. I actually retired earlier to maintain my COLA.
What about high-risk frs. Whats the difference for us
All of the same things apply. The main difference is that your investment plan buyout may be much higher because of your age.
Great video. Question. Once you enter DROP, will my regular paychecks have FICA withheld since I'm technically retired?
Yes. Thats for social security and not the frs
@@AndersRetirement Thank you. I'm planning on contacting you in the near future. I've really enjoyed all of your videos.
how do you get 7.5% more when you only get 1.6 extra for every extra year one works? so 31 years service comparing to 30 years service is only 3.3% more in pension.
1.6 x 5 years
highest 5 years is only used to calculate average salary to determine pension. The example I used showing an extra year service only increasing pension by 3.3% if it is not the one of the highest salary 5 years. @@AndersRetirement
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YOU SHOULD WORK FOR A PENSION. YOU ARE WRONG,