In this episode Don Anders gets into whether you should pick the FRS Investment Plan or the FRS Pension plan. You make this decision when you first start working, but you can also change it using your one-time second election.
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Transcription:
Don Anders: Hello, this is Don Anders, and welcome to the Florida Retirement System Podcast. The purpose of this is just to educate people on retirement, and it's myself, Don Anders. I've been working with FRS retirees for over a decade now. My firm and myself, we've helped over 2,000 people retire, just like you, from the Florida Retirement System.
Don Anders: The reason I started this podcast was because we hear all the time of, "Hey, we really wish we had this education earlier on, before we chose our options, not right when we go to retire," because that's when my firm works with people. So, we decided to do this podcast to educate.
Don Anders: With me we have Alex Dingman. Alex is a longtime friend of mine. He works doing radio, doing podcasts. I brought him on to help me produce this and get it out to you, but more importantly, Alex knows nothing about the Florida Retirement System. So I wanted to bring him on and almost make it like he's a new employee, or someone that is getting ready to retire, and my goal is going to be to educate him on your options, on the FRS options. Because if I can educate him, who's starting from pretty much nothing from an educational standpoint with the FRS, then hopefully I'll be able to educate you on it as well. So, Alex-
Alex Dingman: It's good to be. I hope I can guide you, kind of ask the questions, given the perspective that I'm going to have here, of not knowing much, and then, like you said, you can be the one to educate me, Don.
Don Anders: Hopefully we can. Well, we'll see what we can accomplish. By the way, this is a serial podcast. What that means is we're not going to do a bunch of ongoing ... There's going to be about 15 episodes, and then if there's any updates or changes down the road, we'll go ahead and issue bonus episodes. So, don't think this is going to be a two- or three-year commitment to listen to. 15 episodes, not too long, so you could even knock these out in an afternoon, okay?
Alex Dingman: Outstanding.
Don Anders: Okay. What I wanted to start off with is the difference between the pension plan and the investment plan, Alex. What the pension plan and investment plan is, are the two options. Let's say you're about to start working. Okay? What do you want to be? You want to be a teacher, firefighter, police officer?
Alex Dingman: Firefighter. That sounds pretty cool. Always been a dream of mine to be that cool, so let's do it for this [crosstalk]
Don Anders: Were you playing with the fire trucks as a kid?
Alex Dingman: Yeah. Oh, you know it. Yeah.
Don Anders: Okay.
Alex Dingman: Love it.
Don Anders: All right. So you finally get your dream to become a firefighter. You get on board, and they're going to give you a packet. In that packet, it asks, "Do you want to go with the pension plan or the investment plan?"
Alex Dingman: And I have no idea. I mean, I can think in my head, I've heard these terms before, investing, obviously, putting my money somewhere, a pension, I think that means money you get after you retire. But I'm not really sure what the difference is, Don.
Don Anders: Yeah. And that's pretty accurate, but they both apply to the pension. The FRS is a little unique. Not all pension plans allow people to do this, but the FRS allows you to either have a cash value, a lump sum, or they allow you to have a monthly traditional pension there. There's a few factors that you want to factor in. First off, how long do you plan on being a firefighter
