Tag Archives: Service credit

How to Read Your Retirement Plan Booklet

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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.

ERS Tier 5 Milestones

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If you became an Employees’ Retirement System (ERS) Tier 5 member when the tier began in 2010, you’ve crossed one of many milestones in your public service career. You are now vested, which means you are guaranteed a NYSLRS pension even if you leave public employment at a later date.

So, what are milestones, and how do they affect NYSLRS members throughout their career?

Tier 5 milestones

Why Milestones Matter

As a NYSLRS member, you’ll cross a series of thresholds throughout your career. These member milestones occur when you earn a certain amount of service credit. Because these milestones affect how your pension will be calculated, a better understanding of them will help you plan for retirement.

You can find these milestones on the Membership Milestones page and in your retirement plan booklet. Most members ERS Tier 5 members will retire under the Article 15 retirement plan. (This booklet does not cover ERS Tier 5 members in special plans, such as deputy sheriffs and state corrections officers, but they can also find information on the Membership Milestones page.)

Major Milestones for Tier 5

The day you joined NYSLRS, you were automatically covered by certain job-related death and disability benefits. This is the first milestone for ERS Tier 5 members. After your first year of service, you became eligible to borrow from your retirement contributions, and after two years you became eligible to purchase credit for previous public service.

After becoming vested at ten years, the next big milestone is 20 years, when your retirement benefit improves. If you retire with less 20 years of service, your pension will equal 1.66 percent of your final average salary (FAS) for each year of service. But with 20 to 30 years of service credit, your benefit will equal 2 percent of your FAS, multiplied by your years of service.

For each year of service beyond 30 years, you will receive 1.5 percent of FAS.

Other Milestone Blogs

NYSLRS – One Tier at a Time: PFRS Tier 6

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When you join the New York State and Local Retirement System (NYSLRS), you’re assigned a tier based on the date of your membership. There are six tiers in the Employees’ Retirement System (ERS) and five in the Police and Fire Retirement System (PFRS). Each tier has a different benefit structure established by New York State legislation. Our series, NYSLRS – One Tier at a Time, walks through each tier to give you a quick look at the benefits in both ERS and PFRS. Today’s post looks at PFRS Tier 6. Anyone who joined PFRS on or after April 1, 2012 is in Tier 6. Tier 6 members currently make up about 32 percent of PFRS membership, totaling 10,942 members, making it the second largest tier in PFRS.

Check out the graphic below for the basic retirement information for PFRS Tier 6 members.

PFRS Tier 6

Where to Find PFRS Tier 6 Information

If you’re a PFRS Tier 6 member, please find your retirement plan publication from the list below for more details about your benefits:

Please visit our Publications page for special plans under miscellaneous titles.

Stay tuned for more NYSLRS – One Tier at a Time posts. Check out some earlier posts in the series:

How School Employees Earn NYSLRS Service Credit

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There are non-teachers earning NYSLRS service credit.While most New York teachers and administrators are in the New York State Teachers’ retirement system, other school employees are members of the New York State and Local Retirement System (NYSLRS). In fact, 1 out of 5 NYSLRS members works for a school district. Most work according to the school year, which could be only 10 or 11 months long. So how do we determine service credit for them?

Earning NYSLRS Service Credit When School Employees Work Full-Time

If you’re a school employee who works full-time, you receive one year of service per school year. Generally, a full-time 10-month school year requires at least 180 days worked in any school year. Depending on your employer, a full academic year can range from 170 to 200 days.

Earning NYSLRS Service Credit When School Employees Work Part-Time

Part-time school employees earn service credit based on the number of days they work. The number of hours in a full-time day is set by your employer (it’s between six and eight hours). If you don’t work full-time, your employer converts the number of hours you worked into the equivalent number of full-time days. Your employer reports that number to us, and your days worked are plugged into the formulas below.

Regardless of whether you work full- or part-time, depending on the length of your school year, your service is credited in the following ways:

For all BOCES and school district employees, as well as
teachers working at New York State schools for the deaf and blind:

Number of days worked ÷ 180 days

For college employees:

Number of days worked ÷ 170 days

For institutional teachers:

Number of days worked ÷ 200 days

Infographic showing how to calculate part-time service credit for school employees

Check Your Service Credit

You can check your Retirement Online account to find your current service credit total.

You can also check your Member Annual Statement, which is provided to you every summer. For most members, your statement will show how much service credit you’ve earned for the past fiscal year (April 1, 2018 – March 31, 2019). It will also show your total service credit as of March 31, 2019. Make sure to look it over to see how much service credit you’ve earned over your career.

For more information on service credit, read our booklet, Service Credit for Tiers 2 through 6 (VO1854), or your own retirement plan publication.

Retroactive payments

Retroactive Payments and Your NYSLRS Pension

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Retroactive Payments

Retroactive payments are lump sum payments you receive from your employer. These payments can be from new union contracts, arbitration awards or legal settlements that took place while you were on your employer’s payroll.

Your final average salary (FAS) is a major factor in your pension benefit calculation. Your FAS is the average of your three (five for Tier 6 members) highest consecutive years of earnings. For most people, their highest years of earnings come at the end of their careers.

If you receive a retroactive payment from your employer, it could affect your final average salary. Let’s look at how.

How Retroactive Payments Can Affect Your Benefit

When we calculate your FAS at retirement, retroactive payments are applied to the pay periods when they were earned, not when they were paid. In general, retroactive payments can increase your FAS as long as the time period in which you earned that money is part of the time period your FAS is based on.

Your employer should let us know if you receive a retroactive payment before or after you retire. If you are a State employee who receives a retroactive payment after you retire, we will recalculate your pension automatically; you do not need to notify us. If you receive a retroactive payment from a non-State employer after your pension calculation is finalized, send a letter to our Recalculation Unit in the Benefit Calculations & Disbursement Services Bureau. Please include a copy of your check stub and/or any correspondence you received from your employer. You may also email and upload this information to the Retirement System through our secure contact form.

For more information about FAS, read our Final Average Salary blog post. You can also find out specific information about your FAS by reading your retirement plan booklet, available on our Publications page.

NYSLRS – One Tier at a Time: PFRS Tier 2

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Today’s post looks at Tier 2 in the Police and Fire Retirement System (PFRS). A majority of PFRS members are in Tier 2, which began on July 31, 1973 and ended on June 30, 2009. Most Police and Fire Retirement System members are in “special” retirement plans that allow for retirement after 20 or 25 years, regardless of age, without penalty.

The special plans that cover municipal police officers and firefighters fall under Sections 384, 384(f), 384-d, and 384-e of Retirement and Social Security Law. As of March 31, 2018, there were 17,380 Tier 2 members in these plans; most of whom are covered by either Section 384-d (36.5 percent) or 384-e (62.8 percent).

Check out the graphic below for the basic retirement information for PFRS Tier 2 members.

*This graphic was updated on 6/28/19.

For more detailed information about your benefits, please review your retirement plan publication: Special 20- and 25-Year Plans for PFRS Tier 1, 2, 3, 5 and 6 Members (Sections 384, 384-d and 384-e) (VO1517).

Stay tuned for more NYSLRS – One Tier at a Time posts. Next time, we’ll take a look at another one of our ERS tiers.

Becoming Vested

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What does it mean to be a vested NYSLRS member?

You become vested after you earn sufficient service credit to be eligible for a pension, even if you leave public employment before retirement. Becoming vested is a crucial milestone in your NYSLRS membership.

When Will I Be Vested?

The amount of service credit you need to be vested depends on your tier. If you’re in Tier 5 or 6, you need ten years of service to be vested. If you’re in another tier (Tier 1, 2, 3 or 4), you’re vested once you earn five years of service credit.

vesting requirements

If you work part-time, it will take you longer to become vested. For example, if you work half-time, you earn six months of credit toward vesting for each year on the job. (For more information, read our recent blog about part-time service credit.)

If you purchase credit for previous public service or military service, that credit can help you become vested.

What You Need to Do

Vesting is automatic. You do not need to file any paperwork to become vested.

If you are vested, you will need to file a retirement application at least 15, but no more than 90, days before you can receive a pension. Most NYSLRS members are eligible to collect a pension as early as age 55, but benefits may be permanently reduced if you retire before you reach your plan’s full retirement age.

Visit our website to learn more about vesting.

NYSLRS’ Special Retirement Plans

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NYSLRSCertain PFRS and ERS members are under Special Retirement Plans manages more than 300 retirement plan combinations for its members, which are described in more than 50 plan booklets. But, for all that complexity, they breakdown into just two main types: regular plans and special plans. Under a regular plan, you need to reach certain age and service requirements to receive a pension. For instance, if you’re a Tier 4 member in the Employees’ Retirement System (ERS) with a regular plan, you’re eligible for a benefit when you turn 55 and have five or more years of service credit. Most of our ERS members are in regular plans.

Special plans are a little different. With special plans, NYSLRS members can receive a pension after completing 20 or 25 years of service. There is no age requirement; you can retire at any age once you have the full amount of required service credit. Both ERS and the Police and Fire Retirement System (PFRS) have special plans.

Special Plans for Special Services to the State

As of March 31, 2018, seven percent of active ERS members and 98 percent of active PFRS members are in special plans. These members fill roles such as:

  • Police officer;
  • Firefighter;
  • Correction officer;
  • Sheriffs undersheriff, and deputy sheriff; and
  • Security hospital treatment assistant.

Public employees in jobs like these face dangers and difficulties throughout their careers. They fight fires, patrol our neighborhoods, assist ill patients and more. We’d like to take this opportunity to thank them for the challenging, sometimes life-threatening work they do each day.

If you’d like to learn more about your retirement plan, please visit the Publications page of our website and review your plan publication. If you’re not sure which booklet covers your benefits, you can check your Member Annual Statement, ask your employer or send us an email using our secure contact form.

Dual Membership in NYSLRS

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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. As of State fiscal year end 2018, 1,574 members had memberships in both ERS and PFRS.

How Does Dual Membership Work?

dual membership in NYSLRSLet’s say you work as a fire fighter, 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 fire fighter, 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 salary (FAS) you earned as a bus driver and your PFRS pension using the FAS from your time as a fire fighter.

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 any questions about dual membership, or to discuss your particular situation when you decide to retire, please contact us.

Top 5 Retirement Myths

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retirement myths versus facts

Retirement law can be confusing. Sometimes a small misunderstanding can have a big impact on your benefit. That’s why it’s important to correct some common retirement myths. Here are the top five:

Retirement Myth #1

mythMy NYSLRS loan has gone into default, but I’ve already paid taxes on it. That means I no longer need to repay it.

factYou still need to repay your loan. In fact, it continues to accrue interest until you do. And, if you haven’t paid back your loan by the time you retire, your pension amount will be reduced.

Retirement Myth #2

mythI am required to contribute toward my retirement. When I do retire, my benefit will be based on what I contributed.

fact Your required member contributions aren’t a factor in the calculation of your pension. Your pension is based primarily on your service credit and the salary you earn while working for public employers. Your retirement plan and, in most cases, your age at retirement are also factors.

Retirement Myth #3

mythI can’t collect my pension until I start receiving Social Security.

fact You can collect your pension as soon as you meet the eligibility requirements of your retirement plan. Most members can retire as early as age 55, though there may be a permanent reduction in your benefit if you retire before full retirement age (62 or 63 depending on your tier). You should check the eligibility requirements for your plan and tier when you’re planning for retirement.

Retirement Myth #4

mythIf I am vested (have enough service to be eligible for a pension benefit) and no longer working for a public employer, NYSLRS will automatically start paying my pension as soon as I’m eligible.

fact Only you can decide when it’s time to retire. You must file an Application for Service Retirement (RS6037) to begin collecting your pension benefits.

Retirement Myth #5

mythI recently applied for retirement by giving my employer the paperwork.

factGiving your employer your NYSLRS forms does not mean that you have filed for retirement. To receive your NYSLRS pension, you must file your retirement application with the Office of the State Comptroller. Your application, or any form, is “filed with the Comptroller,” when it’s received by our Albany office or one of our consultation sites.

Have a concern that wasn’t covered? Visit our Contact Us page for more answers. If you have account-specific questions, you can also send us a message through our secure email form.