Tag Archives: Employees Retirement System

NYSLRS Loans Using Retirement Online

Most members can get a NYSLRS loan using Retirement Online. Loan eligibility requirements are based on your tier, but generally, you’ll need to be on the payroll of a participating employer, have at least one year of service and have a certain amount of contributions in your account. Retirement Online will provide the eligibility information you need as you step through the application process.

Use Retirement Online to apply for a NYSLRS loan

Getting Started

Retirement Online is the fastest way to get a NYSLRS loan. It’s also an easy way to find out your current loan balance, the amount you are eligible to borrow and more. ­­If you don’t already have an account, go to the Sign In page and click “Sign Up” under the Customer Sign In button. (Need help with Retirement OnlineSee this post for handy tips.)

The Application Process

Once you’ve signed in, scroll down to ‘My Account Summary.’ Under ‘I want to…’ click the green “Apply for a Loan” button and follow the prompts.

As you work your way through the online application, you’ll see how much you can borrow, the minimum repayment amount, the expected payoff date and how much you can borrow without tax implications.

NYSLRS loans are exempt from New York State and local income taxes. However, the Internal Revenue Service may consider all or part of a NYSLRS loan taxable in some cases – for instance, if you borrow above certain limits. The Retirement Online loan application will show you the maximum amount you can borrow without tax implications. 

If you already have a loan and you want to take another loan, you can take multiple loans or refinance an existing loan. Taking a new loan (the multiple loan option) minimizes your potential tax consequences. Your minimum payment will be higher, but you will pay off your loans faster than you would by refinancing. Refinancing adds the new loan amount to your existing balance and spreads the entire balance over a new five-year term. Your payment will be lower but your tax consequences may be significantly higher.

Repaying Your NYSLRS Loan

Loan payments will be deducted from your paycheck. You can choose the minimum payroll deduction, which would pay off your loan in five years, or you can choose to pay more than the minimum to pay off your loan sooner. The payment calculator in Retirement Online will provide your expected payoff date if you enter an amount higher than the minimum.

If you already have loan from NYSLRS, during this time of economic uncertainty you may be considering whether you can defer your NYSLRS loan payment.

If you are furloughed or on an authorized leave of absence with your employer, the IRS allows for the suspension of loan payments for up to one year from the date your leave began or until you return to the payroll (whichever occurs first). To receive this deferment, have your employer send us a fax (518-486-9877) on their letterhead that indicates the date your leave began and when they expect it will end.

It’s important to note that if you defer your loan payments during an authorized leave of absence, your payments will need to be recalculated and increased upon your return. This will ensure your loan will be paid off within the five-year period.

For more information, please read our blog post, Managing Your NYSLRS Loan Payment.

More Information

For more information, including how retiring with an outstanding loan would affect your pension, visit our Loans page. If you need help with the self-service loan application, click “Help” at the top of your account page. Then click next to ‘Requesting a Loan’ and select the step-by-step guide that best fits your situation. Retirement Online is generally available from 7:00 am to 9:30 pm on Monday, Wednesday, Thursday and Friday; from 7:00 am to 6:00 pm on Tuesday; and from 6:00 am to 11:00 pm on Saturday and Sunday.

NYSLRS Membership by Tier

NYSLRS, which comprises the Employees’ Retirement System (ERS) and the Police and Fire Retirement System (PFRS), had 673,336 members as of March 31, 2020. Our members are State government, local government and school district employees from across New York, including 637,746 in ERS and 35,590 in PFRS. Seventy-nine percent of our members were active, which means they were on a public payroll as of March 31.

NYSLRS Membership Over Time

A decade ago, nearly 90 percent of NYSLRS members were in Tiers 3 and 4. Now, those tiers represent less than half of our membership, while Tier 6 members are on the verge of surpassing them. Tier 6, which includes members who joined NYSLRS since April 1, 2012, has 298,633 members, or 44.4 percent of total membership.

NYSLRS Membership by Tier

Here’s a look at our NYSLRS membership by tier, as of March 31:

Tier 1: NYSLRS’ oldest tier, whose members first joined the system before July 1, 1973 (July 31, 1973 for PFRS members), is dwindling. Tier 1 represented only 0.2 percent of our membership. There were only 1,552 Tier 1 ERS members and 24 Tier 1 PFRS members.

Tier 2: With 22,262 members, Tier 2 represented 3.3 percent of membership. Ninety-two percent of Tier 2 members were in PFRS.

Tiers 3 & 4: Tiers 3 and 4, which have similar retirement plans, had 311,213 members, 46.2 percent of the total membership. Tiers 3 and 4 are primarily ERS tiers. There is no Tier 4 in PFRS, and only 228 PFRS members were in Tier 3.

Tier 5: Tier 5 covers members who joined from January 1, 2010 through March 31, 2012. With 39,652 members, Tier 5 represented 5.9 percent of membership.

Tier 6: This tier covers members who joined since April 1, 2012. Its ranks grew by 15 percent during the last fiscal year.

Why Your Tier Matters

Your tier is an essential component of your NYSLRS membership because it is one of the factors that determines your benefits. You can find out more by reading your retirement plan booklet. Our recent blog posts explain how to find your plan booklet and how to interpret it.

A Look Inside NYSLRS

NYSLRS paid $13.4 billion in benefits to 487,407 retirees and beneficiaries during the State fiscal year that ended on March 31. These benefits are paid out through the New York State Common Retirement Fund (the Fund).

NYSLRS By the Numbers

NYSLRS Membership                                                           

But NYSLRS is more than just the pension fund. The system had 673,336 members as of March 31, including county workers, professional firefighters and State troopers. Here are some facts about our membership:

  • 530,547 active members (that is, members still on a public payroll) work for 2,962 public employers statewide.
  • One-third of those active members work for New York State. The rest work for counties, cities, towns, villages, school districts and public authorities.
  • Nearly 94 percent of active members are in the Employees’ Retirement System (ERS). The Police and Fire Retirement System (PFRS) accounts for 6 percent of NYSLRS membership.
  • More than 44 percent of all members are in Tier 6. Fifty-eight percent of PFRS members are in Tier 2 and almost 49 percent of ERS members are in Tiers 3 and 4.

NYSLRS Retirees and Beneficiaries

The average pension for an ERS retiree was $25,105; the average for a PFRS retiree was $54,684. But these pension payments don’t just benefit the system’s retirees and beneficiaries. Because 79 percent of NYSLRS retirees and beneficiaries live in New York, $10.8 billion worth of benefits stayed in the State. And that money supported local businesses, paid local taxes and generated economic development statewide.

An Award-Winning Publication

Extensive information about NYSLRS members and retirees, the Fund, and Fund investments can be found in the 2020 Comprehensive Annual Financial Report (CAFR). NYSLRS once again received the Certificate of Achievement for Excellence in Financial Reporting for the 2019 CAFR. The Certificate of Achievement is a national award recognizing excellence in the preparation of state and local government financial reports. NYSLRS has won this award for the last 16 years.

Retirement Age and Your NYSLRS Pension

For some NYSLRS members, your retirement age matters when it comes to receiving your NYSLRS retirement benefits.

Your pension will be based largely on your years of service and final average earnings, but your age at retirement is also a factor. How age plays into the equation depends on your tier and retirement plan.

Members in regular retirement plans can retire as early as age 55, but they may face significant pension reductions if they retire before their full retirement age. The full retirement age for members in most tiers is 62, and it’s 63 for Employees’ Retirement System (ERS) Tier 6 members and for Police and Fire Retirement System (PFRS) Tier 6 members who leave public employment before retirement age, but have enough service to receive a pension. If you joined NYSLRS on or after April 1, 2012, you are in Tier 6.

pension reductions based on retirement age

Benefit reductions are prorated by month. The closer you are to your full retirement age when you retire, the less the reduction will be. Here are some examples of how that would work.

  • ERS Tiers 2, 3 and 4, PFRS Tiers 2, 3 (Article 11), 5 and 6: If you retire at age 58 1/2, your pension will be permanently reduced by 16.5 percent.
  • ERS Tier 5: If you retire at age 58 1/2, your pension will be permanently reduced by 20.83 percent.
  • ERS Tier 6: If you retire at age 58 1/2, your pension will be permanently reduced by 29.5 percent.

Once you retire with a reduced benefit, the reduction is permanent — it does not end when you reach retirement age.

Retirement Age Exceptions

Tier 1 members can retire at 55 without a benefit reduction. Benefit reductions don’t apply to ERS Tier 2, 3 or 4 members if they retire with 30 years of service. Tier 5 Uniformed Court Officers and Peace Officers employed by the Unified Court System can also retire between 55 and 62 without penalty if they have 30 years of service.

More Information

Understanding how age affects your NYSLRS benefits is crucial to retirement planning. To learn more, please review your retirement plan booklet on our Publications page.

You can check your service credit total and estimate your pension using Retirement Online. Most members can use our online pension calculator to create an estimate based on the salary and service information NYSLRS has on file for them. You can enter different retirement dates to see how your choices would affect your potential benefit.

Dig into the NYSLRS Summer Reading List

Looking for some summer reading? Why not check out these publications from NYSLRS? They’re light on colorful characters and exotic settings, but what they lack in plot intrigue, they make up for in important retirement information.

summer reading

1. Retirement Plan for ERS Tier 3 and 4 Members (Articles 14 and 15)

More than 250,000 Tier 3 and 4 members of the Employee’s Retirement System (ERS) are covered by this plan. The publication explains some of the benefits and the services available to you, including a service retirement, a vested retirement, a disability retirement, death benefits and more. Read it now.

2. Retirement Plan for ERS Tier 5 Members (Article 15)

If you joined ERS from January 1, 2010 through March 30, 2012, you are in Tier 5. This booklet describes benefits for Tier 5 members in regular retirement plans. Read it now.

3. Retirement Plan for ERS Tier 6 Members (Article 15)

More than 178,000 Tier 6 ERS members are covered by this Plan. The publication explains some of the benefits and the services available to you, including a service retirement, a vested retirement, a disability retirement, death benefits and more. Read it now.

4. Life Changes: A Guide for Retirees

Already retired? As a NYSLRS retiree, you know that you will receive a monthly retirement benefit for life. However there may be other benefits available to you, as well as services that we provide retirees. This guide will answer many of the questions you may have and explain your responsibilities as a retiree. Read it now.

5. What If I Work After Retirement?

In most cases, NYSLRS retirees under 65 can earn up to $35,000 per calendar year in a public-sector job, but there are no restrictions if you work for a private-sector employer. If you plan to work while collecting your pension, you should read this booklet. Read it now.

Other Plan Booklets

Not covered by the retirement plans above? Maybe you’re a police officer, a firefighter, a sheriff or a correctional officer. You can still find you plan booklet on our Publications page. They’re great reading any time of year. If you’re not sure which plan covers your benefits, you can ask your employer or Contact Us.

Dual Membership in NYSLRS

The New York State and Local Retirement System (NYSLRS) consists of two retirement systems: the Employees’ Retirement System (ERS) and the Police and Fire Retirement System (PFRS). Your job title determines what system you’re in. In some cases, however, it’s possible to have a dual membership, to be a member of both systems.

How Does Dual Membership Work?

dual membership in NYSLRSLet’s say you work as a firefighter, so you’re a member of PFRS. You decide to take on a part-time job as a bus driver for your local school district. Your school district participates in ERS, so you’re eligible for ERS membership. You fill out the membership application, and now you’re a member of both ERS and PFRS. The date you join each system determines your tier in each membership.

Implications of Dual Membership

As a member of both systems, you’d have separate membership accounts. Let’s look again at our fire-fighting bus driver example. While working as a firefighter, you make any required contributions and earn service credit toward your PFRS pension only. The same is true for your work as a bus driver—your required contributions and earned service credit only go toward your ERS pension, not your PFRS pension.

There are other implications to dual membership. Assuming you’re vested in both memberships and meet the service credit and age requirements, you could retire and collect a pension from both systems. You’d need to file separate retirement applications for ERS and PFRS, and we’d calculate each pension separately. We’d calculate your ERS pension using the final average earnings (FAE) you earned as a bus driver and your PFRS pension using the FAE from your time as a firefighter.

And, since you’d have both an ERS pension and a PFRS pension, you would need to choose a beneficiary for each in the event of your death.

Questions?

You’ll want to make sure to know the details of your retirement plan in each system. If you have questions about dual membership, or want to discuss your particular situation when you decide to retire, please contact us.

Managing Your NYSLRS Loan Payment

During this time of economic uncertainty, you may be considering how you can lower your NYSLRS loan payment. We understand your concerns and want to provide you with information that can help.

loan payments

How to Lower Your Loan Payment

You may be able to lower your payment amount as long as you still pay the minimum amount required to repay your loan. There are two ways to request a lower loan payment:

  • Manage Your Loan Payment with Retirement Online
    Once you sign in to your account, go to the My Account Summary section and click “Manage My Loans.” You’ll be able to check your payoff balance and minimum payment (payroll deduction) amount as well as change your payment amount.
  •  
  • Send a Loan Payment Change Form
    Fill out our Loan Payment Change form (RS5521) and send it to:
    • NYSLRS
      110 State Street
      Albany, NY 12244

NYSLRS Loan Payments are Set by Law

Loan payments must be paid:

  • At least quarterly (NYSLRS will calculate your minimum payment when you take a loan); and
  • In a sufficient enough amount to repay the loan within five years from the date it was issued.

These are requirements established by both NYS Retirement & Social Security Law (RSSL) and the Internal Revenue Service (IRS). If you are on payroll, your loan will be repaid through payroll deductions.

Can Loan Payments be Deferred?

In certain instances, you may be eligible for a deferment of your loan payment.

If you are on an authorized leave of absence with your employer, or if you have been temporarily furloughed, the IRS allows for the suspension of loan payments for up to one year from the date your leave began or until you return to the payroll (whichever occurs first). To receive this deferment, your employer must send us a fax (518-486-9877) on their letterhead that indicates the date your leave or furlough began and when they expect it will end.

It’s important to note that if you defer your loan payments during an authorized leave of absence or furlough, your payments will need to be recalculated and increased upon your return. This will ensure your loan will be paid off within the five-year period.

Active military personnel may also be able to defer their loan payments. The five-year repayment period for these members can be extended, however your loan balance will continue to accrue interest and you must resume payments once you end active duty. Visit our Loans page for more information.

What Happens If You Go Off Payroll?

If you go off payroll, to avoid your loan going into default, you must make minimum payments at least quarterly and repay the loan within five years. To avoid a default, contact us as soon as you leave public employment, so we can tell you the exact amount you need to pay. If you are in danger of defaulting on your loan, we will notify you. Retirement Online is the easiest way to make loan payments if you are off payroll. Read the Make Lump Sum Payments information on our Loans page for details.

ERS Tier 6

ERS Tier 6 Member Milestones

As an Employees’ Retirement System (ERS) Tier 6 member, your years of service are critical to your benefits. As time goes by, and you earn service credit, you’ll reach a number of career milestones. These milestones are points where you become eligible for certain benefits or your existing benefits improve. Understanding these milestones will help you better plan your career and retirement.

In ERS Tier 6, you reach your first milestone on your first day of membership. This milestone covers you for certain job-related death and disability benefits. (You can learn more about them in your Tier 6 retirement plan booklet.)

ERS Tier 6

10 & 20 Years Make a Big Difference

For all NYSLRS members, there is one critical milestone: becoming vested. Being vested means that you have earned the right to a pension, even if you leave public employment before retirement age. ERS Tier 6 members become vested after they earn 10 years of service credit.

For most ERS Tier 6 members, another big milestone is the 20-year mark, when your retirement benefit improves significantly. If you retire with less than 20 years of service, you earn 1.66 percent of your final average salary (FAS) for each year of service. At 20 years, you receive 35% of your FAS. After 20 years, you’ll earn an additional 2 percent of your FAS for each year of service beyond 20.

ERS Tier 6 Special Plans

For ERS Tier 6 members in special plans, such as corrections officers, many of the milestones are the same. For example, you will become vested with 10 years of service credit.

But there are also major differences. Most importantly, correction officers in the special 25-year plan can retire after 25 years regardless of age. You can find more information in your retirement plan booklet.

How to Read Your Retirement Plan Booklet

In an earlier blog, we explained how to locate your retirement plan booklet. Your retirement plan booklet is an essential resource that you should consult throughout your career. It will help you in planning for your retirement and guide you when your retirement date draws near. Today we discuss what information you’ll find in that booklet and what it means.

retirement plan booklet

About Your Membership

This section has information about your membership and tier status. Look here to find out if your plan requires contributions toward retirement, when you will be eligible for a retirement benefit, and how to withdraw your membership.

Service Credit

Service credit is one of the main factors in determining how much your pension will be. If you work full-time for the State or a participating municipal employer for 12 months, you’ll earn a year of service credit. If you work part-time, your service credit is prorated.

You’ll also find information about how your service credit is calculated, how to purchase credit for previous public employment and military service, how leaves of absence affect service credit, and how sick leave can be used for extra service credit at retirement.

Final Average Salary

Final average salary (FAS) is another major factor in determining the amount of your pension. Your FAS is your highest average earnings during a period of consecutive years. This can be three or five years, depending on your tier.

This section describes what types of payments are used in calculating your FAS and any limitations that may apply.

Service Retirement Benefits

This section describes your retirement eligibility and how your benefit is calculated. If you have questions about how much your pension will be, this is an important section of your retirement plan booklet to read through.

Choosing a Pension Payment Option

There are several ways you can collect your pension. Some payment options, in exchange for a reduction in your monthly payment, will allow you to provide for your spouse or other beneficiary after you die. When reading through this section, consider each payment option carefully, as you’ll only have a limited time to change it after you retire.

Items That May Affect Your Pension

This section describes different factors that can change the amount of your pension. For example, if you retire with an outstanding loan, your pension will be permanently reduced. Also, if you get a divorce, your ex-spouse may be entitled to a portion of your benefit.

A Cost of Living Adjustment (COLA), on the other hand, could increase your benefit once you become eligible.

Vested Retirement Benefits

If you leave public employment before retirement age, but have met the minimum service requirement to receive a pension, you can apply for a vested retirement benefit when you become eligible.

Disability and Death Benefits

Your NYSLRS benefits include more than a pension. If you are no longer able to perform your job because of a medical condition, you may be eligible for a disability retirement. If you die before retirement, your survivors may be eligible for a death benefit.

Receiving Your Benefits

Before you can receive a retirement benefit, you must file the appropriate form with the Office of the State Comptroller. Here you’ll learn where to find the form and what deadlines apply.

Where to Find Your Retirement Plan Booklet

Look for your retirement plan booklet on the Publications page on our website.