Cash Balance Benefit Program Meets Employee Needs

• Immediate vesting—you don't need to accumulate years of service credit to benefit
• Immediate ownership of both your contribution and your employer's contribution
• Guaranteed compounded interest rate on contributions (4.50 percent through June 2011—this rate is adjusted annually)
• Potential additional earnings and annuity credit
• Portability:
  • Between and among employers participating in the CalSTRS Cash Balance Benefit Program
  • Account stays with you even if you change Cash Balance employers
  • May roll over to an IRA or other qualified plan
  • Ability to transfer funds from other qualified plan
• Employee contribution rate of 4 percent matched by employer for a total of 8 percent (alternative contribution rates may be agreed upon through the collective bargaining process)
• Alternative to Social Security, CalSTRS Defined Benefit Program and other alternative retirement plans:
  • 4 percent savings over the Defined Benefit Program
  • 2.2 percent savings over Social Security
• Secure investment—CalSTRS guarantees no loss of principal
• Upon termination or retirement, both employer and employee contributions available for rollover to other qualified plans
• CalSTRS guarantees all benefits paid in full

Eligibility

• Employer formally elects to offer CalSTRS' Cash Balance Benefit Program
• All employees hired to work less than half-time in CalSTRS-covered employment
• All salaries, including summer school and intersession, generally qualify