Tag Archives: New York State and Local Retirement System

Should You Join NYSLRS?

Most State and municipal employees are required to join the New York State and Local Retirement System (NYSLRS) when they are hired. But for some employees, such as part-time and seasonal workers, membership is optional. If you’re a member and you know someone who could join NYSLRS, consider sharing this piece with them.

join NYSLRS for membership benefits

What is NYSLRS?

NYSLRS is the third largest retirement system in the nation, with more than 1.1 million members, retirees and beneficiaries. State Comptroller Thomas P. DiNapoli administers the Retirement System and is trustee of the New York State Common Retirement Fund, which holds and invests NYSLRS assets. The Fund had a value of $210.5 billion as of March 31, 2019.

Why Join NYSLRS?

Joining NYSLRS will improve your chances of a secure financial future. You’ll earn credit toward a pension that will provide monthly payments throughout your retirement. But NYSLRS also provides other important benefits.

What Does NYSLRS Offer?

As a NYSLRS member, you’ll be eligible for a pension after you earn ten years of service credit. (This is called being vested.) If you work part-time, service credit is pro-rated. For example, if you work half of the hours that a full-time employee works, you’ll receive six months credit for every year you work.

Also, as a NYSLRS member you’ll be able take loans from your contributions if you’ve earned a year of service credit and meet other requirements. You’ll be eligible for a death benefit once you have one year of service credit, and disability benefits after you have ten years of service credit. (If your disability results from an on-the-job accident, not due to your own willful negligence, there is no minimum service requirement.)  

Over 3,000 employers participate in NYSLRS, allowing you to continue to build on your benefits if you go to work for another government employer. Your benefits also may be transferable to six other public retirement plans in New York.

Making Contributions

As a Tier 6 member, you’ll contribute between 3 and 6 percent of your earnings to the Retirement System. Tier 6 contribution rates vary based on each member’s annual compensation. If you don’t join NYSLRS when you first start working and later decide to purchase your previous service credit, you will need to contribute 6 percent of those earnings plus interest, even if your salary level for the prior time period would have resulted in a lower contribution rate.   

Your NYSLRS pension will be based on your service credit and salary, not on the amount you contribute. A NYSLRS pension is a lifetime benefit. Unlike a 401-k, there is no risk that your pension benefits will be reduced during your retirement.

But what if you join NYSLRS and decide to leave public service before you are vested? You won’t lose your contributions. In fact, you can withdraw your accumulated contributions, plus interest, and roll that money into a retirement savings plan at your new job.

More Information

If you would like to join NYSLRS or just want more information, please contact your employer’s human resources (personnel) office. You may also be interested in our booklet, Membership in a Nutshell.

How Do I Prepare to Retire?

If you plan to retire in the near future, consider How Do I Prepare to Retire? a must-read.

This NYSLRS publication is a road map for the retirement process — a guide to the steps you’ll need to take before and after you file your retirement application. It highlights resources you can tap to get a better understanding of your benefits, including the NYSLRS website and Retirement Online.

prepare to retire

Retirement Planning Tips

Before you retire, you may need to tie up some loose ends regarding your membership. How Do I Prepare to Retire? discusses how to get credit for all of your service, paying off any outstanding NYSLRS loans, and other matters you should attend to before you file for retirement.

The biggest decision you’ll make as you plan your retirement is setting a date. This booklet includes a discussion about the impact early retirement may have on your pension amount. You’ll also find information about how your final average salary is calculated and how to get an estimate of your future benefits.

Retirement Countdown

Once you seriously begin to consider retirement, the booklet details a few steps you can take to make your path to the big day as smooth as possible.

  • File Proof of Your Date of Birth. Before we can pay any benefits, we must have proof of your date of birth.
  • File Your Domestic Relations Order. If you have a court order showing how your benefits are to be divided with an ex-spouse, we’ll need a certified copy.
  • Review Your Health Insurance. Check what coverage you’ll have or investigate health insurance options. (NYSLRS does not administer health insurance for our retirees, but you may be able to pay for yours through pension deductions.)

Filing for Retirement

Filing an Application for Service Retirement sets the ball in motion. In most cases, your application must be on file with the Office of the State Comptroller 15 to 90 days before you retire. You need to send it directly to NYSLRS; don’t give it to your employer. You can mail it, preferably by certified mail, or drop it off at one of our consultation sites.

This booklet tells you what to do and what to expect as we finalize your pension. There are important documents you’ll need to file, such as a W-4P form, so we know how much we should withhold from your pension. But don’t fret too much about these things: just keep How Do I Prepare to Retire? handy and consult it whenever you have a question.

Other Publications

Read our recent blog posts about other NYSLRS publications.

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 salary, 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.

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.


Your Contributions to NYSLRS

Most NYSLRS members contribute a percentage of their earnings to the Retirement System. Unlike a 401k or IRA, these contributions don’t determine the amount of your pension. So how do NYSLRS contributions work?

NYSLRS retirement plans differ from defined contribution plans, such as 401k plans. In those plans, a worker, their employer or both contribute to an individual retirement account. The money is invested and hopefully accumulates investment returns over time. This type of plan does not provide a lifetime benefit, and there is the risk that the money will run out during the worker’s retirement years.

Your NYSLRS contributions, however, don’t go into a personal retirement account. That’s because NYSLRS is a defined benefit plan. Your contributions go into the New York Common Retirement Fund along with employer contributions and investment income. This pool of money pays out retirement benefits for you and other NYSLRS members.

Once you’re vested, you’re entitled to a pension that will provide monthly payments for the rest of your life. The amount of those payments will be based on your years of service and final average salary, not on how much you contributed to the Retirement System.

How Much Do I Contribute?

If you joined NYSLRS since April 1, 2012, you are in Tier 6. Tier 6 contributions range from 3 to 6 percent of earnings.

To put that into perspective, financial experts advise workers in defined contribution plans to save 10 to 15 percent of their earnings in their retirement accounts.

Visit our Member Contributions page for other tier contribution rates.

Tier 6 contributions

Can I Withdraw My Contributions?

If you leave public employment with less than ten years of service, you can withdraw your contributions, plus interest. If you withdraw, you will not be eligible for a NYSLRS retirement benefit. If you have more than ten years of service, you cannot withdraw, but you will be entitled to a pension when you reach retirement age. But remember, you will not receive this pension automatically; you must file a retirement application before you can receive any benefits.

A Guide for Retirees

Our publication A Guide for Retirees is a valuable resource to read if you’re retired or planning to retire soon. This guide details the continuing benefits and services NYSLRS provides for its retirees.

What’s Inside A Guide for Retirees?

The first section of A Guide for Retirees outlines your benefits in clear, straightforward language. It provides an estimate of when to expect your first pension check, along with a couple reminders to help avert any delay in your payment. There’s also a brief description of how we calculate your benefit and information about what to do if you believe your benefit was calculated incorrectly.

Your NYSLRS retirement benefit will provide you with monthly payments for the rest of your life. But that doesn’t mean the amount of your pension won’t change. For example, your benefit will increase once you are eligible for a cost-of-living adjustment. Signing up for Medicare or getting a divorce can also change your benefit amount.

The booklet also describes benefits that your survivors may be eligible for, such as the post-retirement death benefit.

A Guide for Retirees

Services We Offer

A Guide for Retirees describes services NYSLRS provides for retirees, including:

  • Retirement Online. A fast and secure way to do business with NYSLRS.
  • Automated Information Line. You can call 24 hours a day, seven days a week to request a form, check your COLA eligibility, get general tax information and more.
  • Direct Deposit. Have your pension deposited directly into your bank account.
  • Pension Verification Letters. You can create your own in Retirement Online or we can send one at your request.
  • Individual Consultations. You can discuss your benefits with one of our information representatives in person or over the phone.

Your Obligations

Your benefits come with certain responsibilities. Most importantly, you need to let us know if your address changes. Even if you’re getting your pension through direct deposit, we need to have your correct address so we can send you tax documents and other important information.

This section also reminds you to keep your beneficiary information current, contact us if your check is lost or stolen, and review your withholding regularly.

Other Publications

Read our recent blog posts about other NYSLRS publications:

Cost-of-Living Adjustment (COLA)
Coming in September

Eligible NYSLRS retirees will see a cost-of-living adjustment (COLA) increase in their monthly pension payments beginning in late September.

This COLA is a permanent annual increase to your retirement benefit. It is based on the cost-of-living index and is designed to address inflation.

cola coming

How COLA is Determined

COLA payments, subject to certain limitations, equal 50 percent of the previous year’s inflation rate, but are never less than 1 percent or more than 3 percent of your benefit. The adjustment is applied to the first $18,000 of your Single Life Allowance, even if you selected a different option. Once COLA payments begin, you will receive an increase to your monthly benefit each September.

The September 2019 COLA equals 1 percent, for a maximum annual increase of $180.00, or $15.00 per month before taxes.

Who is Eligible for a COLA?

To begin receiving COLA payments, you must be:

  • Age 62 or older and retired for five or more years; or
  • Age 55 or older and retired for ten or more years (uniformed employees such as police officers, firefighters and correction officers covered by a special plan that allows for retirement, regardless of age, after a specific number of years); or
  • A disability retiree for five years; or
  • The spouse of a deceased retiree receiving a lifetime benefit under an option elected by the retiree. An eligible spouse is entitled to one-half the COLA amount that would have been paid to the eligible retiree when the retiree would have met COLA eligibility; or
  • A beneficiary receiving the accidental death benefit for five or more years on behalf of a deceased Retirement System member.

When Will You See the Increase?

Eligible retirees will see the first 2019 COLA payment in their September pension payment. It will be available to those with direct deposit on September 27, 2019. If you receive a paper check, the COLA will be included in the check to be mailed September 30, 2019.

If you are not eligible yet, you will receive your first COLA increase in the month after you become eligible. This payment will include a prorated amount to cover the month you became eligible. After that, you will receive a COLA increase each September.

What Happens After You File
Your Retirement Application

The big day has finally come. You’ve submitted your retirement application, and you’re ready to start collecting your pension. Here’s what will happen next.

There are four documents we’ll need in addition to your retirement application. You can send them with your retirement application or after you apply:

retirement application

After we receive your application, we will send you a confirmation letter, which lists your retirement date and the forms we’ve received from you. If you don’t submit a W-4P, we’ll withhold federal taxes based on the status “married with three dependents.” (You can change your withholding at any time.)

If you haven’t received an estimate in the past 18 months, you don’t need to send an option election form with your retirement application. We’ll send you an estimate, along with an option election form, after we receive your retirement application.

Your First Payment

Your monthly payments will be based on the salary and service information we have on file.

We cannot send your first payment until we have proof of your date of birth. If you can, you should submit this document with your retirement application. (A copy of your New York driver’s license, birth certificate, passport or naturalization papers are acceptable proofs.) If you don’t have proof of date of birth available when you submit your retirement application, you can email us a photocopy by attaching it to our secure contact form.

We encourage you to sign up for direct deposit, so you’ll have safe and reliable access to your pension payments on the last business day of each month. Paper checks are mailed on the second to last business day of each month and may take longer to receive.

Possible Adjustments

If we receive additional payroll information from your employer, such as eligible lump sum payments, a retroactive pay increase or lagged regular earnings, we may need to adjust your pension payment. Because of the many variables that are often involved in verifying service and salary details with your former employer, finalizing your retirement benefit amount can take some time. The time this takes depends on the complexity of the circumstances. For example, if you worked for multiple public employers, it may take longer to pull together all your income information.

Once we have all the information we need, we’ll recalculate your pension amount. If your payment increases, you will receive a retroactive payment for the amount you are owed back to your date of retirement (the difference between your initial payments and your final retirement benefit amount).

For more information, please read our publication How Do I Prepare to Retire? and these recent blog posts:

What If I Leave Public Employment?

Most of us will change jobs over our lifetimes, and some of us will leave public employment before retirement. But if you leave the public workforce, what will become of your NYSLRS retirement benefits?

leave public employment

NYSLRS has published a booklet to provide guidance in that situation. What If I Leave Public Employment? outlines what happens with your benefits and details your rights and responsibilities. If you recently left public employment or plan to leave in the future, here are some key points the publication can help you understand.

If You Leave Public Employment, Will You Still Get a Pension?

If you’re vested, you can still collect a NYSLRS pension when you reach retirement age. Members in Tiers 1 – 4 become vested after five years of service; members in Tiers 5 and 6 become vested after ten years. Most members can apply for a pension as early as age 55, but their pension may be reduced if they take it before full retirement age (62 or 63).

What if You End Your Membership?

If you’re not vested, you can end your membership and get a refund of your contribution balance, which includes accumulated interest. After you have been off the public payroll for 15 days, you can request a refund by filing a withdrawal application.

If you don’t withdraw your contributions, they will continue to earn 5 percent interest for seven years. If you’re still off the public payroll after seven years, your membership will automatically end. Your contributions will be deposited into a non-interest account but will not be refunded to you automatically. You must file a withdrawal application to receive them.

If you end your membership, you will no longer be eligible for any NYSLRS benefits. There may also be tax consequences to withdrawing your contributions.

What are Your Responsibilities?

If you leave public employment, but remain a member, it’s your responsibility to notify us of any address changes. You will also need to keep your beneficiary information current.

More Information

Please read What If I Leave Public Employment? to get the full story on leaving public employment. We’ll also be featuring other publications in future blogs, including:

Prepare Your Affairs and Survivors

Much of the thought we put into financial planning and preparing for retirement is self-focused: How much do I need to retire? Am I saving enough? However, when we die, our survivors will have some important decisions to make about our finances. Putting our affairs in order now can make a difficult time for them a little less uncertain.
prepare your affairs and survivors

Organize Your Documents

The first step to putting your affairs in order is collecting all the assorted records, certificates and other paper work in a secure place. You’ll also want to write down names and phone numbers for any friends or business associates who could be helpful (like your attorney, accountant, financial planner, insurance agent or the executor of your will).

Our form, Where My Assets Are (VO1848), can help your survivors find these important documents. Fill it out, then review it and update it regularly.

Talk to Your Loved Ones

You may not feel comfortable discussing death with your friends and loved ones. However, all the preparation in the world won’t do you any good if you keep your plans a secret.

  • Once you’ve collected your files and put together a list, let your potential survivors know where it is. It’s important that they know where your assets and documents are.
  • Review your finances with your loved ones, including your children.
  • Make sure your beneficiaries understand that it can take up to 13 weeks between notification of your death and payment of any death benefit or the beginning of any continuing benefit (if you selected an option that provides a continuing benefit). Death benefits cannot be paid until we have a certified death certificate. Make sure we have correct addresses for your beneficiaries.
  • Discuss your funeral and burial preferences, and let your family know about any arrangements you have already made.
  • Work with an attorney to prepare a will or trust.
  • Consider advance directives, such as a durable power of attorney, living will, health care proxy or do-not-resuscitate order. If you have minor children, be sure to name a guardian for them in the event of your death. If you have a child with a disability, it’s a good idea to consult a professional who can help you navigate complex Medicaid and Medicare rules. You may also want to consider the NY ABLE program.

Finally, let your potential survivors know about our publication, Getting Your Affairs in Order and A Guide for Survivors. The second half is full of guidance on what to do and who to contact if a loved one dies.

Computer System Upgrades Begin Now

Today through mid-May 2019, NYSLRS is conducting a series of computer system upgrades to improve the services available to our customers.

Retirement Online will be unavailable throughout the upgrade period. However, you will still be able to conduct business with NYSLRS by email, mail and phone.
computer system upgrades

Please note:

  • If you need to apply for a loan during the upgrade period, you can fill out a loan application and mail it to our office. Visit our Loans page for links to the applications and more information.
  • If you need to update your beneficiaries, fill out the Designation of Beneficiary form (RS5127). If you mail it to us “Certified Mail — Return Receipt Requested,” we will consider it as filed on the date it was mailed. Your beneficiaries will be updated in our system shortly after the upgrade is completed.
  • If you need to change your address, you can submit the new address by phone, email or mail. Your address will be updated in our system after the upgrade is completed.
  • We will continue to process requests for income verification letters by email using our secure contact form or by fax at 518-473-5590. Tell us what information you need, and be sure to include your retirement or registration number, current address and daytime phone number (in case our customer service representatives have a question).
  • Your monthly pension payments will not be affected. However, we will not be able to process any direct deposit changes during the upgrade. We expect to complete direct deposit change requests received in April in time for the end-of-June deposit and those received in May for the end-of-July deposit.

For the latest information about the upgrade, please visit our Contact Us page. If you have any questions, please contact our Call Center at 1-866-805-0990 (518-474-7736 in the Albany, NY area), or email them using our secure contact form.