SEGIP — continuing life insurance at retirement

Basic life (state-paid) and child life • The State’s contribution for basic life ends

at retirement.

• At retirement, you can continue basic and child life coverage at your own expense for up to 18 months or until you are eligible for coverage under a new group plan, whichever occurs first.

• For cost: https://mn.gov/mmb-stat/segip/doc/combined-ret-rates.pdf

• SEGIP/MMB bills you directly, and you will remit premium back to them. (Minnesota Life is not involved in this “18-month continuation” process.)

• Toward the end of the 18-month period, MMB will advise you of your right to convert coverage to an individual policy. If you convert coverage within 31 days of the group coverage termination date, conversion to the new policy is guaranteed, meaning coverage cannot be denied.

• For conversion information and cost: www.lifebenefits.com/plandesign/statemn Click on Forms & Documents.

Optional employee and/or spouse lifeNo cost post-retirement death benefit

Employees retiring at or over age 65

• In order to receive this benefit, you must have carried the optional life insurance for at least 5 years prior to the date you retired or turned 65, whichever occurs later.

• The paid-up post-retirement benefit amount will be 15 percent of the smallest amount of optional insurance you had during that 5-year qualifying period.

• The 15 percent benefit will continue for the remainder of your life at no cost to you.

• Accidental death & dismemberment coverage is included.

• Employees may continue the remaining 85 percent of coverage under the 18-month Minnesota Continuation law. The premium rate will be the same as it is for an active employee of the same age.

• At the end of the 18-month continuation period, any portion of that coverage may be converted to an individual policy with Minnesota Life.

Employees retiring prior to age 65

• If you retire prior to age 65, you may elect to continue your optional life insurance until your 65th birthday by continuing to pay the required premium directly to Minnesota Life. The premium rate will be the same as it is for an active employee of the same age.

• The post-retirement death benefit will then be provided for you at age 65.

• The benefit amount will be 15% of the smallest amount of optional insurance you had during the 5-year period preceding age 65.

• This coverage will continue for the remainder of your life at no cost to you.

• Accidental death & dismemberment coverage is included.

• When the 15 percent post-retirement death benefit goes into effect at age 65, retirees then have the option of converting any portion of the remaining 85 percent of coverage to an individual policy with Minnesota Life.

Designed exclusively for State of Minnesota employees, this plan is jointly underwritten by Minnesota Life Insurance Company, an affiliate of Securian Financial Group, Inc., and the ReliaStar Life Insurance Company, Minneapolis. This brochure is intended as a general guide to these options. For details, see the certificate of insurance. In the event of a conflict between this summary and the policy and/or certificate, the policy and/or certificate shall dictate the insurance provisions, exclusions, all limitations, and the terms of coverage. Products are offered under policy form series 03-30522 and MHC-96-13240.Securian Financial is the marketing name for Securian Financial Group, Inc., and its affiliates.

Spouse life

• A post-retirement death benefit may also be provided for your spouse if he/she is age 65 or over when you retire, or when your spouse reaches age 65 if that occurs after you retire.

• To qualify, you must have had spouse insurance for at least 5 years prior to your retirement date or your spouse’s 65th birthday, whichever occurs later.

• The benefit amount will be 15 percent of the smallest amount of life insurance you carried on your spouse during the 5-year qualifying period, and it will continue for the remainder of your spouse’s life at no cost to you or your spouse.

• Accidental death & dismemberment coverage is included until the spouse reaches age 70.

• If your spouse is not yet age 65 when you retire, you may continue his/her coverage until he/she is 65 by remitting premium directly to Minnesota Life. The premium rate will be the same as if the employee were still active. When the 15 percent Post-retirement death benefit goes into effect at age 65, your spouse will have the option of converting any portion of the remaining 85 percent to an individual policy with Minnesota Life.

• If your spouse is 65 years or older upon your retirement, you may continue the remaining 85 percent of your spouse’s coverage under the 18-month Minnesota Continuation law. At the end of the 18-month continuation period, any portion of that coverage may be converted to an individual policy with Minnesota Life.

Eligible retirees include• Regular retiree: age 65 or over and entitled to

receive a retirement annuity based upon years of service.

• Early retiree: under age 65 at time of retirement, has 5 years of allowable pension service or meets the service requirement of the collective bargaining agreement or plan, whichever is greater, and is entitled at the time of retirement to immediately receive a retirement benefit or a retirement annuity under a retirement program sponsored by the state or such organization of the state, or is at least 50 years of age with at least 15 years of state service.

Whichever category applies, you must make a decision at the time you retire whether or not you want to continue coverage. You cannot enroll for or increase optional life benefits after retirement; however, you can decrease or cancel coverage at any time.

Employees who don’t qualify as a “retiree” or if an employee cannot satisfy the 5-year qualifying coverage period for either him/herself or for the spouse, then the 18-month Minnesota Continuation law would apply, followed by the conversion option.

ReliaStar Life Insurance Company 20 Washington Avenue South Minneapolis, MN 55401

400 Robert Street North Suite 1880 St. Paul, MN 55101-7734 ochs@ochsinc.com 651-665-3789 1-800-392-7295

lifebenefits.com

400 Robert Street North, St. Paul, MN 55101-2098 ©2018 Securian Financial Group, Inc. All rights reserved.

F30448-9 Rev 4-2019 DOFU 10-2018 590112

INSURANCEINVESTMENTSRETIREMENT

It is the Agency HR staff’s responsibility to provide the retiring employee with all necessary continuation forms. The employee returns the completed forms to HR, who forwards them to SEGIP. If needed, SEGIP/MMB will send Minnesota Life a copy for the post-retirement benefit.

For conversion information and cost: www.lifebenefits.com/plandesign/statemn Click on Forms & Documents.

Questions?Minnesota Management & Budget (MMB/SEGIP): 651-355-0100, or Ochs Inc.: 651-665-3789 or toll free 800-392-7295 Email: ochs@ochsinc.com

State of Minnesota

Contact Securian phone: 1-877-494-1714 (option 1 for claims or option 3 for all other questions)

Contact Ochs phone: 651-665-3789 / 1-800-392-7295 email: ochs@ochsinc.com

Retiree Dedicated Customer ServiceHave questions or need information

• Coverage amounts• Premium payment• Beneficiary designations• Claims• Policy details

Beneficiary Designation and Change Request

Minnesota Life Insurance Company - A Securian Company Group Insurance Department B2-2012 400 Robert Street North St. Paul, Minnesota 55101-2098

A A A abcd

Employer

State of Minnesota

Policy number

7166-G/28736-G

This designation applies to (If this section is left blank, your designation will apply to all coverages.):

All coverages Life Insurance only (use one form for each coverage, if necessary)

Accidental Death & Dismemberment only (use one form for each coverage, if necessary)

Print policyowner's name and address below. New address

Insured Insured's employee ID

Insured's date of birth Policyowner (if different than the insured) Policyowner's telephone number

( )

INSTRUCTIONS:

1. Print or type in the space below, the full name, address, relationship to the insured, and share % of each beneficiaryto be named.Sign and date the completed form. 2.

Return to Minnesota Life using the address above or fax to 651-665-4827.3.

Call 1-866-293-6047 with questions.4.

CHANGE BENEFICIARY REVOKING ALL PRIOR DESIGNATIONS

The primary and contingent beneficiary(ies) determines the order in which beneficiaries become eligible to receive deathproceeds. Surviving beneficiaries in any category share equally unless otherwise specified. "Children," used withoutmodification, includes only lawful bodily issue of first generation and legally adopted person. Any policy requiring policyendorsement is waived. This designation, when acknowledged by the Company at its Home Office, is in lieu ofendorsement.

Name beneficiaries by category. To receive death proceeds, a beneficiary must survive the insured. In the event abeneficiary does not survive the insured, that beneficiary's portion shall be equally distributed to the remainingbeneficiaries within that category. In the event of simultaneous death of the insured and a beneficiary, the deathproceeds will be paid as if the insured survived the beneficiary. The same person cannot be named as a primary and acontingent beneficiary.

PRIMARY BENEFICIARY(IES) - The person or persons named will receive the proceeds

Share % (for primarybeneficiaries must total 100%)Beneficiary Full Name & Address Relationship

CONTINGENT BENEFICIARY(IES) - If the primary beneficiary(ies) is no longer living, the benefit is paid to the person or persons

Share % (for contingentbeneficiaries must total 100%)

Beneficiary Full Name & Address Relationship

SIGNATURE

Policyowner's signature Date

X

F43649B-60 1-2010RETURN TO MINNESOTA LIFE FOR ENDORSEMENT

N

How you can keep your life insurance going…

even if your group coverage ends. If any portion of your group life insurance coverage terminates (because your employment or membership in a class eligible for insurance terminates or the master group contract terminates or is amended), you may be able to continue your life insurance protection. Your right to do this is called a conversion privilege, and its features are described here for you.

In order to exercise your conversion privilege, you must—within 31 days after your group insurance ends—submit the conversion enrollment form attached and the first premium payment. Your conversion rights are subject to the master contract under which you are insured.

How can I continue my life insurance protection when my group coverage terminates? You can continue your protection by taking out an individual life insurance policy. You do not have to prove that you are insurable, but you must submit your enrollment form and first premium payment within 31 days after your group coverage ends.

What about my family’s insurance? If your group coverage includes life insurance on your dependents, you may be able to continue their protection under individual policies. Check your certificate to make sure they qualify.

What about temporary layoffs? It’s not usually necessary to enroll for conversion if you are laid off temporarily. You can usually make arrangements with your employer to keep your group insurance in force.

What if the master group contract terminates or is amended? Depending upon applicable state law and the terms of the master group contract, you may be eligible to convert all or a portion of your group life insurance.

How much insurance can I get? If your coverage terminates for any reason other than cancellation or amendment of the master contract, you can convert all or any portion of your group insurance. If your master group contract terminates or is amended and you are eligible to convert, the amount you are eligible to convert will depend on applicable state law and the terms of the master group contract. Call our toll-free number for details.

What if I die before I have a chance to convert my insurance? If you die during the 31-day conversion period, your beneficiary will receive the full amount of your group insurance that was available for conversion—whether or not you enrolled to continue your coverage. Any premium paid for a new policy will be refunded.

What kind of policy will be issued? You will be issued a whole life insurance policy known as Individual Whole Life Insurance Policy.

Individual Whole Life Insurance Policy features: Premiums are payable until death. Face amount of insurance payable at death. Living benefit builds cash value. Premium amount remains the same (based on your age at time of conversion).

Automatic premium loan Should you fail to make a premium payment before the end of the grace period we will make a policy loan to pay the balance of the premium. Please indicate on the enrollment form if you want the premium loan to be operative.

How much will it cost? Your premiums will be at regular rates in use at the time your new policy is issued, depending on your age at the time you convert. Use the rates shown in this brochure to determine your initial premium. Rates are subject to change.

Conversion to Individual Whole Life Insurance Policy

EdF68525 Rev 2-2019

How do I determine my new premium? 1. The effective date of your new policy will usually be 31 days from the date your group coverage

terminates. Your issue age is your current age.2. Find the annual premium rate per $1,000 for your age in the rate table.3. Multiply the rate by the amount of insurance you are requesting.4. Add the annual policy charge of $40.00.

Can I pay more often than once a year? You may make premium payments quarterly or semiannually if each payment is at least $10. To determine a semiannual premium, multiply your annual premium by 0.50. To determine a quarterly premium, multiply the annual premium by 0.25. You must initially pay a quarterly premium payment to establish your individual life contract. After that, you may choose to pay your premiums monthly using an automatic EFT option AFTER your individual life policy has been established. See the examples provided.

Here are examples to help you determine your new premium. Please complete the column below. Line Example 1 Example 2 You

1. Birth date March 6, 1963 March 6, 1963

2. Last day of coverage April 30, 2018 April 30, 2018

3. Effective date of new policy (the first of the month following 31 days after line 2)

June 1, 2018 June 1, 2018

4. Actual age on effective date of new policy 55 55

5. Amount of new insurance $22,167 $75,000

6. Premium rate per $1,000 for age on line 4 $40.57 $40.57

7. Amount times rate divided by 1,000 = (line 5 times line 6 divided by 1,000)

$899.32 $3,042.75

8. Annual policy charge = $40.00 $40.00 $40.00

9. Annual premium = (line 7 plus line 8) $939.32 $3,082.75

How to determine premium payment amount for semiannual or quarterly payments: Semiannual premium = Annual premium (line 9) x 0.50 $469.66 $1,541.38

Quarterly premium = Annual premium (line 9) x 0.25 $234.83 $770.69

How do I convert? Complete the enrollment form attached. Use your beneficiary’s full name (no initials) and show the relationship of each beneficiary to you (for example, wife). Sign and date the enrollment form using your full name (no initials) and mail it along with your first premium payment.

If you want to convert your dependents’ insurance, complete a separate enrollment form for each individual. Sign the enrollment form as “Employee,” and have your dependent (if legally old enough to sign) sign as “Person Converting.”

For more information about your conversion privilege, call toll-free 1-866-365-2374.

EdF68525 Rev 2-2019

Annual premium rate per $1,000*

Age Premium Rate Age Premium Rate 0 7.76 56 43.01 1 8.01 57 45.71 2 8.29 58 48.88 3 8.58 59 52.23 4 8.79 60 55.95 5 8.88 61 60.22 6 8.98 62 64.88 7 9.12 63 69.71 8 9.26 64 74.39 9 9.44 65 79.62 10 9.66 66 86.31 11 9.90 67 94.15 12 10.18 68 102.72 13 10.47 69 110.17 14 10.80 70 119.60 15 11.07 71 131.52 16 11.35 72 144.96 17 11.57 73 160.14 18 11.74 74 176.02 19 11.90 75 192.36 20 12.07 76 210.58 21 12.23 77 232.23 22 12.40 78 256.74 23 12.53 79 283.79 24 12.72 80 311.70 25 12.91 81 337.92 26 13.16 82 364.76 27 13.43 83 393.05 28 13.76 84 421.35 29 14.12 85 450.52 30 14.50 86 481.64 31 14.86 87 512.97 32 15.30 88 543.92 33 15.76 89 578.76 34 16.23 90 614.12 35 16.73 91 651.52 36 17.27 92 691.15 37 17.83 93 733.44 38 18.42 94 779.48 39 19.06 95 827.08 40 19.73 96 876.59 41 20.49 97 900.00 42 21.32 98 900.00 43 22.24 99 900.00 44 23.21 100 900.00 45 24.28 101 900.00 46 25.37 102 900.00 47 26.58 103 900.00 48 27.95 104 900.00 49 29.33 105 900.00 50 30.90 106 900.00 51 32.53 107 900.00 52 34.38 108 900.00 53 36.36 109 900.00 54 38.42 110 900.00 55 40.57

*Rates are subject to change if it’s determined they must change for all insureds. Annual policy charge is $40.00 per year.

EdF68525 Rev 2-2019

Conversion of Group Life Insurance Enrollment

Minnesota Life Insurance Company - A Securian Company

400 Robert Street North St. Paul, Minnesota 55101-2098A abcd

Name of person converting (please print first name, middle initial, last name) Relationship to employee

Employee Spouse Child

Social Security number Date of birth Phone number Gender

Male Female

City State Zip codeStreet address

Name of employee (if other than person converting) Date of birth Phone number

Reason for termination of group insurance Name of previous employer

Termination of employment on (date)Group policy numberRetirement on (date)

No longer eligible as a dependent on (date)Amount of group insurance terminatingOther

New (Converted) InsuranceAmount of insurancebeing converted

Amount of premiumattached

Type of insurance policy Premiums payablex Individual Whole Life

Insurance Policy Annually Semiannually Quarterly$ $Automatic premium loan (defaults to having this provision if no selection is made)

Do you want the Automatic Premium Loan to be operative? Yes No

Beneficiary Information - Subject to the policy beneficiary provisions. Right is reserved to revoke andchange any beneficiary not designated irrevocable.

PRIMARY BENEFICIARY(IES) - The person or persons named will receive the benefit

Date ofBirth

Social SecurityNumber

Share % (musttotal 100%)

Beneficiary Full Name Address and Phone Number Relationship

Total = 100%

CONTINGENT BENEFICIARY(IES) - If the primary beneficiary(ies) is no longer living, the benefit is paid to this person(s)

Date ofBirth

Social SecurityNumber

Share % (musttotal 100%)

Beneficiary Full Name Address and Phone Number Relationship

Total = 100%

AGREEMENT: Information in this enrollment form is given to obtain this insurance and is true and completeto the best of my knowledge and belief. The policy issued hereupon shall not take effect unless the firstpremium shall be actually paid to the Company during my lifetime upon or before delivery of the policy.

Signature of employee (if other than person converting) Date

XSignature of owner (if other than person converting) Date

XSignature of person converting (if over 18) Date

XTO BE COMPLETED BY EMPLOYER (Optional):

Date on which this individual first became insured under thisgroup policy

Date to which group premiums were paid for this individual

I certify that the information given by this employee concerning employment and group insurance withus is correct according to our records.

Group policyholder Plan or division

Signature Title Date

X

Send the completed enrollment form(s) and the first premium payment(s) to: Group Conversions, Minnesota Life, 400 Robert Street North, St. Paul, Minnesota 55101-209803-30573 EdF68525 Rev 2-2019

If you’re like many people, you may have purchased term life insurance years ago to financially protect the people you care about. The right next step for you depends on where you’re at in life.

Term life insurance basics Term life insurance covers you for a specific period outlined in the policy (the “term”). Typical terms may range from 10 to 20 to 30 years.

While your costs will likely be lower with term life insurance, you’ll reach a point when your insurance term will end. If you’re certain the people you care about won’t need financial protection in another 15 or 20 years, that may be just fine.

You may think that once the term ends, you’ll have fewer financial obligations and insurance won’t be as important.

Sounds reasonable, right? But life often doesn’t go according to plan.

Questions to ask yourself when your term policy ends

Now, your term coverage is ending. Since you first took out your term policy, has your life situation changed?

• Do you have dependents? • Do you have a large mortgage or other debt? • Are you in good health? • What shape is your budget in? • What are your plans for the future? • Do you want to leave financial assets to your heirs? • Do you have a child with special needs who will need financial support after you’re gone?

You may have different financial obligations like these than you did before – and you still may need life insurance. Here are five life insurance options you can consider when your term policy is about to end.

Ready to purchase life insurance? Call Securian Financial at 1-877-491-5271 to talk about your insurance needs

Your term insurance is about to expire. How will you continue your life insurance coverage?

6 life insurance options when your term policy is up

1. Make the same choice again You could apply for a new term insurance policy. Or if the policy allows, you could renew your insurance for another term. (You’ll pay higher premiums, since you’re now older.)

You may need to prove you’re in good health and undergo a medical exam. If you’re not in good health – if, for example, you’ve developed high blood pressure, high cholesterol or had other health issues – you could be turned down for insurance or face much higher premiums.

2. Convert to permanent life insurance Some companies allow policyholders to convert term insurance to permanent life insurance. There may be a limited time period or an age by which the policyholder must make this change. The amount of insurance coverage provided under the conversion may be limited.

But with permanent life insurance, the insurance remains in place as long as the policyholder makes the premium payments required to keep the policy in force. Part of the premium goes into a cash value account that builds up over time.

3. Start over with a new permanent life insurance policy You could apply for a permanent life insurance policy – with an insurance amount that fits your needs and budget. You would likely be required to undergo a health exam, but once approved, you would have lifelong insurance coverage as long the policyholder pays the required premium.

The cash value part of the premium can grow over time, providing savings that can be used while you’re alive.

4. Mix it up: have both term and permanent life insurance This doesn’t have to be an either/or choice. You could purchase term life insurance to cover a specific obligation, and a permanent policy for lasting insurance protection. For example:

• Apply for a term policy amount to fit the length and amount of your mortgage. • Apply for a permanent policy to pay additional benefits to your spouse and children if you

die. • The permanent policy may also build cash value you could use while still living.

Accidental death insurance: Another insurance choice

What if you don’t qualify for term or permanent life insurance because of serious health issues? Accidental death insurance could be a solution. It often doesn’t require a health exam and premiums are typically lower than term or permanent insurance premiums.

But these policies only pay a benefit if a death is the result of an accident. For example, they don’t pay benefits if death resulted from cancer or a heart condition, which are the two most common causes of death in the United States.1

5. Look into buying life insurance at work Life insurance offered through your employer is typically “group insurance,” meaning one policy covers a defined group of people (in this case, you and other people who work for the same organization).

Many employers automatically provide a basic level of life insurance – usually equivalent to about one year of your salary. In fact, you may not even know you have it, since many employers pay for this coverage on your behalf and do not deduct it from your paycheck.

Employers also typically provide the opportunity for you to enroll for additional coverage that you pay for through payroll deduction.

6. Choose life insurance with additional benefits Some life insurance companies offer policies that can help pay for long-term care expenses.

As the population ages and health costs continue to rise, policies that include these options are becoming more popular. When the policy owner dies, the amount that hasn’t been used typically goes to the policy’s beneficiary.

Consulting a financial advisor is always a good idea If your term insurance policy is about to end, you may want to talk to a financial advisor so you can better understand the choices you have, how they fit your needs and plans – and determine the right life insurance option for you and your family.

1 “The top 10 leading causes of death in the United States,” Medical News Today, February 2017. Please keep in mind that the primary reason to purchase a life insurance product is the death benefit. Policy loans and withdrawals may create an adverse tax result in the event of lapse or policy surrender, and will reduce both the surrender value and death benefit. Withdrawals may be subject to taxation with the first fifteen years of the contract. You should consult your tax advisor when considering taking a policy loan or withdrawal. Life insurance products contain fees, such as mortality and expense charges (which may increase over time), and may contain restrictions, such as surrender periods. Insurance products are issued by Minnesota Life Insurance Company or Securian Life Insurance Company, a New York authorized insurer. Minnesota Life is not an authorized New York insurer and does not do insurance business in New York. Both companies are headquartered in Saint Paul, MN. Product availability and features may vary by state. Each insurer is solely responsible for the financial obligations under the policies or contracts it issues. Securities, variable insurance products and investment advisory services offered through Securian Financial Services, Inc., registered investment advisor, member FINRA/SIPC. This is a general communication for informational and educational purposes. The materials and the information are not designed, or intended, to be applicable to any person’s individual circumstances. It should not be considered investment advice, nor does it constitute a recommendation that anyone engage in (or refrain from) a particular course of action. If you are seeking investment advice or recommendations, please contact your financial professional. Securian Financial is the marketing name for Securian Financial Group, Inc., and its affiliates. Minnesota Life Insurance Company and Securian Life Insurance Company are affiliates of Securian Financial Group, Inc.

Securian Financial Group, Inc. securian.com

400 Robert Street North, St. Paul, MN 55101-2098 ©2018 Securian Financial Group, Inc. All rights reserved.

DOFU 1-2019 722818

If you’re not 100 percent sure how to make the most of your Social Security benefits with your retirement plan, read on.

The first Social Security benefit was paid out in 1940 to a school teacher.1

Nearly 80 years later, 48 million retired Americans and their survivors receive the benefit.2 Yet some confusion still surrounds the claiming of Social Security for retirement income.

Below are answers to six key questions about Social Security benefits – to help you cut through all the confusion. Learn how your retirement income and pension can affect your benefits, whether you should count on your Social Security to subsidize your retirement, and more.

1. Can my retirement income impact my Social Security benefits? Yes, if you earn greater than the 2018 income threshold of $17,040 and are less than full retirement age your Social Security benefits will be reduced. Note that once you reach full retirement age of 66 or 67, the money you earn at a job shouldn't affect your benefits.3

The earliest age you can receive Social Security benefits is 62. Some retirees decide that a job-free life isn’t for them and decide to return to work part-time. In fact, nearly one-third of people ages 65 to 69 were in the workforce in 2017.4

2. What happens if my employer was not required to withhold Social Security taxes from my income? Many public sector employees don't have to pay Social Security taxes while working - rather that money goes towards the funding of public pensions. In addition, employees who work outside of the United States may not pay Social Security taxes. The Windfall Elimination Provision (WEP) describes how your Social Security benefits may be reduced.

3. Will a pension lower my Social Security benefits? Pensions may lower Social Security benefits depending on whether your pension is from a private- or public-sector employer (i.e., public school or state/local government entity). Another factor is whether you paid Social Security payroll taxes during your career.

The WEP affects some three percent of Social Security beneficiaries, or 1.8 million people, who collect a pension in which they didn’t pay Social Security taxes. However, most employees pay these taxes – which amounts to 6.2 percent of gross wages – through FICA (Federal Insurance Contributions Act), and their employers match these contributions.5

Confused about Social Security—and how to make this benefit work best for your retirement? We’ve got some answers.

6 answers to key Social Security and retirement questions

Private sector vs. public sector

Employees in the private sector pay the 6.2 percent Social Security tax through payroll taxes, and their employers match it. So these employees aren’t penalized during retirement. Conversely, many public sector employees don’t have to pay Social Security taxes while working – rather that money goes toward the funding of public pensions; thus, the law requires that these employees’ Social Security benefits be reduced.

Note: If a public pension is in your future, be sure to plan the timing of when you claim both your pension and Social Security benefits – you might want to stagger them. Why? Because the rules that govern both are only effective when you’re receiving both at the same time.

For example, if you’re set to receive your public pension at age 62, you might want to wait to claim your Social Security benefits at a later age. On the other hand, private pensions generally don’t affect Social Security benefits.6

4. Is a retirement pension considered income? For Social Security purposes, pension payments are not considered to be earnings so you won’t need to pay Social Security taxes. However, you may have to pay income tax on all or some portion of them.8

Fully taxable pensions would include ones that you didn’t contribute to, your contributions have been tax-free, or your employer didn’t withhold contributions. Partially taxable pensions include ones that you contributed after-tax dollars to. Lastly, if you receive a pension payment early (before age 59½), you might be taxed an extra 10 percent.9

5. What percentage of retirement income will come from Social Security? Your Social Security benefit should be approximately 40 percent of your pre-retirement earnings.10

It was never intended to replace your entire income when you retire. So, your retirement income should be balanced and resemble a three-legged stool:

1) Your Social Security,

2) Your employer benefit program,

3) Your personal savings/investments.11

Many financial experts say to you will need about 70 percent of pre-retirement earnings to maintain your standard of living after you retire.12 But if you plan to spend more money on travel and entertainment, then expect to save more for a higher cost of living. And keep in mind inflation.13

Most recipients receive between $700 and $1,800 in Social Security benefits per month. In 2016, Social Security benefits averaged $1,341 per month.14

Even people who earned very high salaries don’t make a fortune from Social Security. In 2017, the largest Social Security income payment was for $3,538 a month, which went to a retiree who waited until age 70 to collect his or her benefits.15

Will my Social Security retirement payout be enough? It depends on many factors – including when you retire and start drawing Social Security.

Beginning in 2030, the government estimates the average payment to recipients will need to be cut by 29 percent. That’s because the number of workers (many of them retiring Baby Boomers) who contribute to Social Security is on the decline. For now, the Social Security Trust Fund is helping to make up the shortfall, but it can fix the problem for only so long.16

That means by the time you retire, you might not be able to count on Social Security replacing 40 percent of your income. Consider investing more in a 401(k) or an IRA to offset this balance.

This information is a general discussion of the relevant federal tax laws provided to promote ideas that may benefit a taxpayer. It is not intended for, nor can it be used by any taxpayer for the purpose of avoiding federal tax penalties. Taxpayers should seek the advice of their own advisors regarding any tax and legal issues specific to their situation. 1. Special Collections, Social Security Administration, ssa.gov, 2018. 2, 11. Insured Retirement Institute (IRI) Retirement Factbook, 17th Edition, May 3, 2018. 3, 4. “How part-time work in retirement can affect Social Security taxes and Medicare costs,” Sarah O’Brien, CNBC.com, August 13, 2018. 5. “What is the windfall elimination provision?” aarp.org, October 10, 2018. 6. “Can my pension lower my social security benefits?” Dan Caplinger, fool.com, June 19, 2018. 7. “Ask Larry: Will my spouse’s pension reduce my Social Security benefit?” Laurence Kotlikoff, forbes.com, September 12, 2018. 8. Benefits Planning: Retirement, Social Security Administration, ssa.gov, 2018. 9. IRS Topic Number 410 - Pensions and Annuities, Internal Revenue Service, irs.gov, 2018. 10, 14, 16. “How much of my income will social security replace in retirement?” Todd Campbell, fool.com, February 28, 2016. 12. Topic Number 410 – Pensions and Annuities, Internal Revenue Service, irs.gov, 2018. 13, 15. “Will your Social Security retirement income be enough?” Cindy Collins, forbes.com, February 7, 2018. Insurance products are issued by Minnesota Life Insurance Company or Securian Life Insurance Company, a New York authorized insurer. Minnesota Life is not an authorized New York insurer and does not do insurance business in New York. Both companies are headquartered in Saint Paul, MN. Product availability and features may vary by state. Each insurer is solely responsible for the financial obligations under the policies or contracts it issues. Securities, variable insurance products and investment advisory services offered through Securian Financial Services, Inc., registered investment advisor, member FINRA/SIPC. This is a general communication for informational and educational purposes. The materials and the information are not designed, or intended, to be applicable to any person’s individual circumstances. It should not be considered investment advice, nor does it constitute a recommendation that anyone engage in (or refrain from) a particular course of action. If you are seeking investment advice or recommendations, please contact your financial professional. Securian Financial is the marketing name for Securian Financial Group, Inc., and its affiliates. Minnesota Life Insurance Company and Securian Life Insurance Company are affiliates of Securian Financial Group, Inc.

Securian Financial Group, Inc. securian.com

400 Robert Street North, St. Paul, MN 55101-2098 ©2018 Securian Financial Group, Inc. All rights reserved.

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While you’re doing everything you can now to be a healthy retiree, you’re still going to have the expected – and the unexpected – medical costs.

In fact, a healthy 65-year-old couple that has a life expectancy of 87 years is projected to pay $321,994 in premiums for Medicare Parts B and D, supplemental insurance and dental insurance.1

Other estimates indicate a couple will need $280,000 (up 2 percent from $275,000 in 2017) to cover health care costs during their retirement years. And for individuals, it’s expected to be around $133,000 for men and $147,000 for women.2

Whatever the costs, it’s not going to be an inexpensive undertaking to pay for Medicare, which is your primary health care insurance during your retirement years. Here are some tips on how to include Medicare in your retirement planning.

The ABCs of Medicare First off, know what Medicare’s different letters mean:

• Medicare Part A covers hospital visits

• Medicare Part B entails doctor visits

• Medicare Part D is for prescriptions

But wait, what about Part C? Medicare Part C (also known as Medicare Advantage plans) is all-in-one coverage (hospital, doctor, and prescription coverage) that is sold through private insurers that contract with Medicare. It may also include dental and vision coverage.3

Now that we have that covered…

When does Medicare become available to me? You’re automatically enrolled in Medicare Parts A and B at the age of 65, if you’re already earning Social Security.4 Or you’ll have the option to receive it when you get disability benefits from the Social Security Administration or Railroad Retirement Board.

Perhaps you’re eligible for Medicare Parts A and B, but need supplemental insurance for costs not covered by “original Medicare” (i.e., dental, vision, hearing aids, eye glasses, long-term care, and private-duty nursing).

There is a six month initial open enrollment period for Medigap coverage that starts the month you turn 65.5

If you think you only need to save enough money for retirement, think again.

Tips for navigating the basics of Medicare in retirement

How are Medicare premiums paid?

For Part A, no additional premium is paid. For Part B, the premium is paid through a reduction in Social Security benefits. And for Parts C and D, it all depends on the kind of private insurance you have.6

How much will Medicare cost me? It all depends. Just know that health care costs could be your biggest expense post-retirement. For a preview of what your costs could be, go to Medicare.com, enter your zip code and select a plan. Then, consider your health history (and your family’s), what your future finances will be, and other factors that could affect your money in retirement.3

And remember that Medicare doesn’t cover dental, vision, hearing conditions or long-term care. You’ll need a separate insurance plan if you don’t want to pay for these medical expenses out-of-pocket. And, oftentimes, you might still need to pay deductibles and copayments on services covered by Medicare.7

Do I need to save for Medicare when planning for retirement? Yes, you should do what you can now to help plan for your costs due to Medicare.

According to a recent report, health care expenses are expected to increase by 5.5 percent every year, which is triple the inflation rate from 2012 to 2016. In 10 years, a retired couple will need up to 92 percent of their Social Security benefits to help cover health care costs.7

Consider contributing to a health savings account (HSA), which has a triple tax advantage — meaning that contributions are pretax or tax-deductible, grow tax-free, and can be withdrawn without being taxed when used on qualified medical expenses and premiums. And any unspent funds roll over to the next year.2

Long-term care insurance provides services (such as nursing home care) that Medicare doesn’t cover. To qualify, you likely will need to purchase while in good health. So make it something you consider when planning for your retirement.7

Can I do anything now to make paying for Medicare later any easier? You can also make healthy choices now to increase your chances of aging well and helping to mitigate extra health expenses down the road.8 It will help you feel better now – especially with all this talk about Medicare costs – and potentially in the long run.

Are there any unexpected taxes related to paying for Medicare?

Your modified adjusted gross income (which includes capital gains, Social Security, required minimum distributions from IRAs and 401(k)s, and more) determines the amount you pay for Medicare Part B premiums.

This information should not be considered as tax or legal advice. Clients should consult their tax or legal advisor regarding their own tax or legal situation. 1. HealthView Services, 2017 Retirement Healthcare Costs Data Report. Assumes premiums for Medicare Parts B, D and supplemental coverage. Assumes life expectancy of 87 years. 2. Grant, Kelli B., Epperson, Sharon. “Here’s how to plan for higher health-care costs in retirement,” CNBC.com, April 28, 2018. (Figures includes premiums, cost-sharing provisions and out-of-pocket costs associated with Medicare parts A, B, and D. But the figures do not include other health expenses such as over-the-counter medications, most dental services and long-term care, and do not factor in any employer-provided retiree health coverage.) 3. Cross, Jory. “Plan Medicare Health Costs for Retirement,” Medicare.com, September 16, 2018. 4. Getting started with Medicare, Medicare.gov 5. When can I buy Medigap?, Medicare.gov 6. What Medicare covers, Medicare.gov 7. Schnaubelt, Catherine. “Planning for the High Cost of Healthcare in Retirement,” Forbes.com, June 6, 2018. Insurance products are issued by Minnesota Life Insurance Company or Securian Life Insurance Company, a New York authorized insurer. Minnesota Life is not an authorized New York insurer and does not do insurance business in New York. Both companies are headquartered in Saint Paul, MN. Product availability and features may vary by state. Each insurer is solely responsible for the financial obligations under the policies or contracts it issues. This is a general communication for informational and educational purposes. The materials and the information are not designed, or intended, to be applicable to any person’s individual circumstances. It should not be considered investment advice, nor does it constitute a recommendation that anyone engage in (or refrain from) a particular course of action. If you are seeking investment advice or recommendations, please contact your financial professional. Securian Financial is the marketing name for Securian Financial Group, Inc., and its affiliates. Minnesota Life Insurance Company and Securian Life Insurance Company are affiliates of Securian Financial Group, Inc.

Securian Financial Group, Inc. securian.com

400 Robert Street North, St. Paul, MN 55101-2098 ©2018 Securian Financial Group, Inc. All rights reserved.

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