As we were heading into the month of August, the trustees of the RMT were preparing for our third quarter meeting. By the time you read this, that meeting will have already happened. We met in the city of Irvine.
I always reach out to the trustees before the meeting just to make certain we are all, as they say, “on the same page of music.” We were going to be in serious discussions with a variety of potential service providers for a new auditor. And we were expecting PORAC President Brian Marvel to show up as well.
That being the case, I wanted to make certain everyone grabbed their coat and tie. I started the email to the trustees to remind them. The first line read, “It goes without saying.”
I got to thinking about that. If something goes without saying, why do we insist upon saying it? Don’t they already know? It seems a bit paradoxical.
I believe that the reason is simple. It is one way in which we highlight something that is important. An insurance policy against failing to plan and cover all of the bases. A bit like the RMT.
The RMT will celebrate 14 years in existence in September. I have had the pleasure of serving as a trustee for about 12 years now. I’ve talked to a lot of PORAC members during that time. I have come to realize not everybody knows about us, what we offer, how it works, what it costs and what the benefits are that they can expect to receive. That’s why I feel the need to say it, share it and explain it. Stick with me here, as it won’t take long.
The primary mission of the RMT is to provide a funding mechanism (monetary benefit), which is available upon retirement and reaching the age of 55. The money must be used for health insurance premiums and medical expenses. That includes medical, dental, vision, chiropractic, prescription and long-term care premiums.
With the blessing of the federal government, we are able to accept contributions on a pre-tax basis. We direct the contributions to our professional investment advisors. They handle the money with kid gloves, according to our declared investment policy. We have a good history of achieving our financial goal in the stock market. We make money, and the feds allow us to avoid any taxation on the earnings growth of our three-tiered portfolio.
We monitor your contributions. Much like pension plans, the longer you work, the bigger your anticipated benefit. We have a formula in place to calculate that benefit. And once you become age-eligible and we start sending money your way, you will receive it totally tax free. Your benefit is designed to last a lifetime. A surviving spouse would be entitled to 50% of your benefit.
That is the Reader’s Digest version of why we exist. Here are a few highlights to give you a bit more information.
- When your association joins, you will need to make contributions for five years in order to be eligible for the lifetime benefit.
- For a variety of reasons, some of your members won’t make it to the five-year mark (retirement, resignation, termination, probation failure, injury, etc.). There are a couple of options available. But in no event will you lose any money.
- The minimum monthly contribution is $100. Associations have the option to alter the contribution rate in the future. An association can also negotiate for the employer to make some or all of the contribution.
- An association can opt to convert and transfer sick leave, vacation or both at the time of service separation.
- The plan is available to sworn, non-sworn and fire personnel.
- The trustees are volunteers who are either currently employed as a LEO with a participating association or retired from a participating association. They are elected one each from the four PORAC regions and serve a two-year term. The PORAC president appoints a fifth trustee from his Board of Directors. Your employer has no say in how the Trust is run. All decisions are made by the trustees.
As you might have noticed, this was a very basic overview. We have a website that offers a whole lot more information, including the summary plan description. Find us at PORACRMT.org.
We would be very happy to send some information your way. And with the pandemic subsiding, we have resumed in-person presentations. We can meet with your board and/or attend an association meeting. Over the years, we have met with association leaders at the Annual Conference. That’s in San Diego in about 10 weeks.
So, to summarize, sometimes you just have to say that which goes without saying, “stay safe and remain healthy.” See you at Conference.