early retirement analysis
DESCRIPTION
TRANSCRIPT
7/1/2013 7/1/2014 7/1/2015 7/1/2016 7/1/2017Current Policy 246 266 271 294 314Rule of 80 148 27 19 34 20
# of Eligible employees
Current Plan Annual Cost7/1/2013 7/1/2014 7/1/2015 7/1/2016 7/1/2017
Average # of employees 22 22 22 22 22Average Age at Retirement 58.76 58.76 58.76 58.76 58.76
Total Salaries at Retirement 1,430,000 1,451,450 1,473,222 1,495,320 1,517,750 Replacement Salary @ 80% 1,144,000 1,161,160 1,178,577 1,196,256 1,214,200 Insurance at Retirement 10,000 10,000 10,000 10,000 10,000 Average Incentive Payment 915,200 928,928 942,862 957,005 971,360
Cost of Retirement Through Age 65 2,288,000 2,301,728 2,315,662 2,329,805 2,344,160 Payback Over the Next 10 Years 2,860,000 2,902,900 2,946,444 2,990,640 3,035,500 Net Savings/(Cost) over 10 Years 572,000 601,172 630,782 660,835 691,340
Annualized Savings 57,200 60,117 63,078 66,084 69,134 Annual Cost of Premium Pay 1,600,000 1,600,000 1,600,000 1,600,000 1,600,000 Total Annual Savings/(Cost) (1,542,800) (1,539,883) (1,536,922) (1,533,916) (1,530,866)
Rule of 80 Annual Cost 7/1/2013 7/1/2014 7/1/2015 7/1/2016 7/1/2017
# of employees 148 27 19 34 20Average Age at Retirement 61.42 59.66 60.72 60.38 61.5
Total Salaries at Retirement 9,557,971 1,715,981 1,117,420 2,294,789 1,151,544 Replacement Salary @ 80% 7,646,377 1,372,785 893,936 1,835,831 921,235 Insurance at Retirement 10,000 10,000 10,000 10,000 10,000 Incentive Payment at 50% 4,778,986 857,991 558,710 1,147,395 575,772 % Assumed to Retire 100% 100% 100% 100% 100%Cost of Retirement Through Age 65 10,077,386 2,299,791 1,371,910 2,718,195 1,275,772 Payback Over the Next 10 Years 19,115,942 3,431,962 2,234,840 4,589,578 2,303,088 Net Savings/(Cost) over 10 Years 9,038,556 1,132,172 862,930 1,871,384 1,027,316
As of Jan. 2011:Estimated retiree insurance benefit expense for 2011 is $1.2 million.
Employee Group breakdown4 Officers19 Administrators44 Faculty74 Staff
141 Early Retirees receiving some health benefit
Estimated premium pay for fiscal year 2011 is $1.6 million
69 of the retirees are currently receiving the premium rate
Estimated incentive pay for fiscal year 2011 is $.7 million