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  •  WHAT’S NEW FOR 2025?  

    From the NJ Division of Pensions and Benefits

     

    DENTAL PLAN CHANGES:

    To streamline the dental plan options going forward, there will be three levels of coverage available: the Dental Expense Plan Plus, the Dental Expense Plan, and the Dental Maintenance Organization Plan.


    Beginning January 1, 2025, carrier and plan options will be reduced to the:

    • One Dental Maintenance Organization (DMO) plan - Aetna DMO/DPO.
    • Two Dental Expense Plans (DEP) - Aetna Retiree DEP and Horizon Retiree DEP.
    • Two Dental Expense Plans Plus - Aetna Retiree DEP Plus and Horizon Retiree DEP Plus.
    • Due to the new dental contract awarded to Aetna and Horizon, the CIGNA DHMO, Horizon Dental Choice, and MetLife DPO plans will no longer be offered.


    Important coverage additions:

    • The SEHBP Retiree Dental Expense Plan (DEP) will now include dental implants.
    • A new Retiree Dental Expense Plan Plus will be introduced, offering coverage for implants and orthodontics for children under the age of 19 across all tier levels.


    No action was required of retirees who have Aetna DMO or Aetna Retiree DEP.

     

    Unless you utilized the SPECIAL ENROLLMENT PERIOD, any retirees previously enrolled in the CIGNA DHMO, Horizon Dental Choice, or MetLife DPO plans were automatically moved to the Aetna DMO plan. 


    To learn more about the Aetna and Horizon dental plans, you are invited to attend their webinars.


    2025 rate charts for the dental plans are posted in mynjbenefitshub and on the NJDPB website at: nj.gov/treasury/pensions/hb-info-retired.shtml


    INCOME BENEFIT CHANGES:

    Since a major change, effective January 1, 2024, increased the income amounts for Options A, B, C, D,1, 2, and 3, there are no additional changes to Pension Income Benefits at this time.

     

    From the Internal Revenue Service

     

    SOCIAL SECURITY MAXIMUM WAGE LIMIT:

    The IRS has increased the maximum wage limit from $168,600 to $176,100 for 2025. This is important for the Tier 2 – 5 members who currently earn more than that amount to correctly calculate their pension income, as their salary is limited to the Social Security maximum wage of $176,100 in 2025 and not their actual salary.

    TPAF members are eligible for participation in the DCRP for salary over the maximum wage limit.
     

    CONTRIBUTION LIMIT CHANGES:

    403(b) and 457(b) annual contribution amounts for all employees have increased.

    For employees who participate in 403(b) and 457(b) plans, the annual contribution limit increased from $23,000 to $23,500.


    Special Catch-Up Contribution Limits for Certain Individuals:

    The catch-up contribution limit that applies for employees aged 50 and over who participate in 403(b) and 457(b) plans remains at $7,500 for 2025. Therefore, in 2025, participants in 403(b) and 457(b) plans who are 50 and older can contribute up to $31,000 to each plan. Under a change made in SECURE 2.0, a higher, enhanced catch-up contribution limit applies to employees aged 60, 61, 62 and 63 who participate in these plans. For 2025, this special catch-up contribution limit is the greater of $10,000 or 150% of the 2024 Contribution Limit – that’s $11,250 instead of $7,500! This is an important change to review with your payroll company and TPA to make sure that they do not stop your contributions at the lower limit if you qualify for the special increase.

    NEW ROTH Catch-Up Contribution Limits now with Income Testing:

    In SECURE 2.0, individuals who are both over age 50 AND with an income of $145,000 or more, must make their catch-up contributions as a ROTH contribution using after-tax dollars. This is an important change to review with your payroll company and TPA.


    Do you need assistance understanding how these changes affect you? If you do and would like to learn more, please contact Ginger Thompson at ginger@njasa.net to schedule a call with me.