Need Help Choosing UC Retirement Savings Option

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LMK5
Posts: 219
Joined: Sat Jan 05, 2008 8:43 pm
Location: Orange County, CA

Need Help Choosing UC Retirement Savings Option

Post by LMK5 » Wed Nov 07, 2018 12:03 am

My wife has 8 years of CalPERS enrollment. She has been separated from CalPERS for 5 months, and is now starting with University of California (UCRP system). Because she has been separated from CalPERS for less than 6 months, she can apply for reciprocity, where the CalPERS retirement benefit can be enhanced by the UC salary at retirement.

Does the fact that she has reciprocity make the Pension Choice option a better one than Savings Choice (self directed 403(b))? Any other factors to consider? BTW she is now 46 years old.

stochastic
Posts: 35
Joined: Sun Sep 06, 2015 5:09 pm

Re: Need Help Choosing UC Retirement Savings Option

Post by stochastic » Wed Nov 07, 2018 5:14 pm

I think starting work later at 46 tends to favor the pension option, less time for the 403 to compound. It'd help to know her income, how that compared to her income in her prior job and how long she expects to stay at UC. Not sure where the calpers service counts towards the time to be better at UC.

I would probably go with the pension option but it may depend on the exact details.

LMK5
Posts: 219
Joined: Sat Jan 05, 2008 8:43 pm
Location: Orange County, CA

Re: Need Help Choosing UC Retirement Savings Option

Post by LMK5 » Wed Nov 07, 2018 6:20 pm

Thanks stochastic,

The salary at this job is in the mid-50s, just slightly higher than her pay while under CalPERS. She plans on staying at UC long term, probably for 10 years or longer. The reciprocity agreement, I believe, lets CalPERS use her salary at UC to help determine CalPERS benefits.

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