The UC Board of Regents recently approved several recommended changes to the UC Retirement Plan (UCRP) based on findings from an “experience study” of the Plan presented to the Regents at their September meeting. An experience study is conducted for UCRP every three to five years to determine if revisions are needed to the actuarial assumptions.
The approved changes that will go into effect in 2016 include the following:
- Capital Accumulation Payment (CAP): Starting Jan. 1, 2016, the earnings rate on balances resulting from CAP allocations in 2002 and 2003 will change from 7.5 percent per year to 7.25 percent per year.
- Lump sum cashout (LSC): The new actuarial basis, effective for LSCs on or after July 1, 2016, will result in higher LSC amounts than under the current basis, with increases ranging from about 3 percent to about 5 percent, depending on the member’s age. LSCs at age 60 will be about 4 percent higher under the new basis.
- Monthly payment options: For retirements starting July 1, 2016, the payment option amount under the new actuarial basis for members with a contingent annuitant of a similar age will increase slightly — up to about 2 percent. There may be a smaller increase or possibly a slight decrease for Members with contingent annuitants that are much older or younger than they are.
Note: No changes are being made to UCRP benefits that are payable as basic retirement income.
To learn more or if you have questions, you can speak with your campus benefits office, a retirement counselor or call the Retirement Administration Service Center at 800-888-8267.