Satellite Broadcasts

U.S. Office of Personnel Management
FERS Election Opportunities

FERS, Its Time to Choose
Transcript of the December 2, 1998 Broadcast

Notes:
-Bracketed [ ] text indicates that information was not included in the Satellite Broadcast.
-A person's name in parentheses indicates the speaker.

(Doris, Introduction)

Hello, Im Doris McMillan, your host for this sixth and final satellite broadcast sponsored by the U.S. Office of Personnel Management for the FERS open season. Were glad you joined us.

Today, were coming to you from the studios of the Health Care Financing Administration, or HCFA, in Baltimore, Maryland. In case the name HCFA isnt familiar to you, its a major component of the Department of Health and Human Services and is the agency that administers Medicare. Our program is being produced by staff of the Social Security Administration (SSA). We want to thank HCFA and SOCIAL SECURITY for making this program available to all of you who are still looking at your choice between staying in the Civil Service Retirement System, or CSRS, or transferring to the Federal Employees Retirement System, or FERS. Since this is a government production and isnt copyrighted feel free to turn on the VCRs. Its yours to replay, re-transmit, or use in training. You can also purchase videotapes of todays broadcast by calling (703) 620-6000. Checks or VISA only.

As Im sure you know, were in the final days of a six-month long open season that began July 1 and ends on December 31. It may seem that the beginning of the open season was only yesterday, but now its nearly over. If you want to transfer to FERS, you only have until December 31 to turn in your election. So, it really is "Time to Choose."

Its very unusual for employees to be given a choice of retirement plans especially two plans that are as good as CSRS and FERS so you need to take advantage of this opportunity and make the choice that is best for you. Remember, if you transfer to FERS, your decision is irrevocable. Also, if you decide to stay in CSRS, you arent likely to have another chance to transfer to FERS unless you have a break in service. So, this is a very important decision. During the next ninety minutes, we will have lots of information to help you make your decision.

First, Ed Flynn, Associate Director for Retirement and Insurance at the U.S. Office of Personnel Management, and Phil Gambino, Assistant Deputy Commissioner for Communications at the Social Security Administration, have some important points for you to consider in making your decision.

Next, experts from OPM and SOCIAL SECURITY will answer a number of the questions that employees ask most frequently about their choices between CSRS and FERS. These are questions that employees have asked again and again at presentations, in individual counseling, and in prior broadcasts. Some are taken from questions that viewers faxed in during earlier programs and before todays show.

One tool that helps employees choose between CSRS and FERS is profiles of typical employee situations, and discussion of key points in the employees decision. The third segment of our program will feature a panel of retirement counselors who will talk about several typical employee profiles. As you watch these profiles, look for similarities between these employees and the factors in your own personal profiles.

Finally, our last segment is your chance to ask your own questions. If you want to fax a question in now, the number is (410) 786-8890. To call in with a question, dial 1-800-953-2233. Ill repeat those numbers later.

Now, lets really get into our program and go to Ed Flynn, Associate Director for Retirement and Insurance at OPM.

(Ed)

Thanks, Doris. Its a pleasure to be here today.

As Doris just said, were now down to the final days of the Open Season. While some of you may be watching simply to learn more about your retirement benefits, we assume most of you are watching because you havent decided whether to stay in the Civil Service Retirement System or switch to the Federal Employees Retirement System.

It may be you havent had the time to think about your choices believe me, I know how busy all of us are. Or, it may be you find it hard to think about retirement because it seems far off in the future. You may be uncertain about your future plans or worry that events beyond your control make it difficult to plan.

What we hope to do for you in this program is focus on the characteristics of the Civil Service and Federal Employees Retirement Systems in terms of the most typical transfer considerations. Our experience has been that most of the time you can make transfer decisions more easily when you examine the characteristics of the two systems, and the things that are most important to you.

Before we get into the heart of the program, I want to take a moment to thank the Health Care Financing Administration for co-hosting this program with us. As Doris said, our program is coming to you from their studios in Baltimore, Maryland. So, thanks to you, Pierce, and your associates, for making this program possible.

Lets take a minute now to list some of the most common considerations in making a decision about staying in the Civil Service Retirement System or transferring. You may want to jot these points down so you can keep them in mind during the broadcast.

First, do you expect to retire from Federal service, or do you expect to leave before retirement?

Second, are you able to save for your retirement through the Thrift Savings Plan or some other means?

Third, do you plan to retire soon, or will you continue to work a number of years before you leave Federal service?

Is flexibility in your retirement options important to you?

Will you receive a Social Security (SS) benefit based on your work record or that of your spouse?

Are maximum survivor benefits for your spouse important to you?

Do you have any concerns about your health?

And finally, if you are in the Civil Service Offset system, do you have a substantial number of years of Offset coverage?

During the segments that follow, we will focus on these questions in several ways. First, Phil Gambino, the Assistant Deputy Commissioner for Communications at the Social Security Administration, will highlight some important considerations about your Social Security benefits.

Were really glad the Social Security Administration is co-hosting this broadcast because most of you, whether you transfer or not, will eventually become eligible for a Social Security benefit. A 1996 study done by the Social Security Administration found that almost 900,000 Civil Service retirees, or more than half the retired population, were also entitled to Social Security benefits. Since Social Security is an integral part of the Federal Employees Retirement System package, we expect this number will increase substantially as more of those employees retire.

You know that your retirement plan provides not only retirement income, but also payments if you become disabled, and benefits to your family if you die. So does Social Security. This makes it even more important to know about Social Security benefits you and your family may be entitled to receive. In addition, if you transfer to the Federal Employees Retirement System, Social Security is more likely to be a larger portion of your retirement income.

To help you get this information, we constantly work with the Social Security Administration to be sure that information about Social Security benefits is part of our products. We couldnt do this work without their great support and cooperation. So, without further ado, let me introduce Phil Gambino from the Social Security Administrations Office of Communications and, as I do, say thanks for the top notch support and assistance we get from your office.

(Phil)

Thank you, Ed, and thanks for inviting Social Security to co-host today's broadcast. The timing of this broadcast could not be better. As you said, time is running out for the FERS open season. All Federal employees have to make their decision to either switch to FERS or stay with the Civil Service Retirement System. In today's broadcast we'll be highlighting many of the issues that other employees have addressed in making their decisions. However, there is one issue that I'd like to address now. Some people are concerned about the future of Social Security. Let me assure you that Social Security is there for you today and it's going to be there for you in the future. As a matter of fact, next week there's going to be a White House conference dealing with the future of Social Security. We all know how important Social Security has been to America, and we also know that changing demographics will require some changes to Social Security in the future. The White House conference will be addressing some of the future options for Social Security. But make no mistake about it, Social Security will be there in the future.

Another important aspect of today's broadcast rests with something that Ed alluded to earlier. Most retired Federal employees will be entitled to a Social Security benefit whether you switch to FERS or not. And, all Federal employees hired after 1987 will have Social Security as the major component of their benefits package: retirement, as well as disability and survivor's benefits. We all need to learn more about Social Security.

Finally, I want to remind all of you considering your options, that every decision is a personal decision. Each decision has to be based on your individual and family characteristics. To make the right decision you must understand how Social Security benefits are computed, and how the Windfall Elimination Provision or Government Pension Offset may affect you. Although there is a lot of confusion about some of these provisions, you'll learn that they're relatively easy to understand. Today you will be offered many resources to help guide you. One of the more important ones will be your Social Security Personal Earnings and Benefit Estimate Statement (PEBES). Your PEBES will have benefit amounts that you'll need to examine to make your decision. The PEBES and the other tools being offered will make your decision making much clearer. Good luck and thanks for watching.

(Ed)

Thanks Phil. Now, let me repeat some points weve made all along during this Open Season because they are very important.

First of all, take advantage of this opportunity. Take the time to consider your decision about remaining in the Civil Service System, or transferring to the Federal Employees Retirement System. If you dont make a decision, then the clock will make it for you. It is, as the title of the program says, "time to choose." Youre not likely to have another chance to transfer unless you have a break in service.
Second, make your own decision. No one can or should make it for you. What may be a good decision for me may not be a good decision for you because of differences in our employment history, personal circumstances, or plans for the future.
Third, make your decision based on what you know today. None of us have a crystal ball to predict the future. You need to look at what you know about your employment history, your current situation, and your expectations for the future.
People often ask us at OPM what retirement changes we think there may be in the future. The short answer is that no one really knows. You must, however, decide on the basis of what you know and your best judgment about what the future may hold. Focus on the opportunity you have now rather than worrying about things you cant control. Make your best judgment and then go with it.
Finally, remember that this is not a "right" or "wrong" issue for most people. Your choice is between two excellent retirement systems. However, one may fit your needs better than the other, so use this opportunity to make a careful choice. And now, lets go back to Doris for the next part of the program.

(Doris)

Thank you, Ed. And now were going to those frequently asked questions. With me are two experts on retirement and Social Security. Henrietta Galloway is a benefits specialist from OPMs Retirement and Insurance staff. Bob Gleason is a public affairs specialist with Social Securitys Office of Communications. Welcome to the show.

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Updated 9 December 1998