DROP - OPERS

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Corollary • If later retirement is not an objective, a partial lump sum option (PLOP) is an alternative to a DROP. (Currently available to members of OPERS.) •Why? – It is easy to understand and to administer. – It has fewer traps. – Benefits are preserved but have been restructured into a more desirable form. 22
Gray Cases • It is not always possible to predict how the DROP affects human behavior. This is why many plans that are supposed to be cost neutral pay less than 100% into the DROP account. 23
Page 1 and 2: MEMORANDUM OHIO PUBLIC EMPLOYEES RE
Page 3 and 4: Deferred Retirement Option Plans DR
Page 5 and 6: What is a DROP? • Both types of D
Page 7 and 8: The PLOP Alternative • PLOP stand
Page 9 and 10: DROPs and Cost Neutrality A common
Page 11 and 12: DROP Operation • Upon satisfactio
Page 13 and 14: DROP Variations • DROP account is
Page 15 and 16: Potential Benefits to Members • D
Page 17 and 18: Possible Disadvantages for Members
Page 19 and 20: Disadvantages for Plan Sponsors •
Page 21 and 22: Cost Neutral • Current contributi
Page 23: Actuarially Cost Neutral This impli
Page 27 and 28: DROP Conclusions • If a DROP has
Page 29 and 30: Other Design Issues • Death or di
Page 31 and 32: DROP Valuations • In order to eva
Page 33 and 34: #2 - State Plan - Forward DROP Samp
Page 35 and 36: Sample DROP Plans #4 - State Genera

DROP - OPERS

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