•  Please refer to the following benefit estimator if you would like to obtain an estimate of your potential Tier II/IIA benefit under different scenarios.
   
• Currently, this estimator is designed to provide estimates for members who are planning to retire within the next 12 months.

Normal v. Early Retirement for retirement dates through 6/1/2022:

• Normal Retirement Age:
  • If you have at least 10 but less than 25 years of vesting service, your normal retirement age is 62.
     
  • If you have 25 or more years of vesting service, your normal retirement age is 60.
     
• Early Retirement Reduction:
  • Tier II and Tier IIA members who choose to retire prior to reaching their normal retirement age are subject to a permanent early retirement reduction.
  • o If you are subject to the early retirement reduction, your basic normal benefit will be reduced by one-half of one percent (.005) for each month (6% per year) that you leave prior to reaching your normal retirement age.
     

Normal Tier II/IIA Benefit Formula:

• The following formula will determine your normal Tier II/IIA retirement benefit, prior to any early retirement reduction (if applicable):
  
  

Early Retirement Reduction Formula:

• The following formula is used to calculate the early retirement reduction for a Tier II/IIA (if applicable):

Example:

• The following is an example benefit calculation for a Tier II/A member retiring:
  • In 2015; at age 55; with 18 years and 6 months of service; and an average salary of $78,300.00.
     
• (This formula has been updated to reflect the change to the Tier II/IIA formula as a result of the 2011 SEBAC agreement.  and applies to individuals who left state service on or after July 1, 2013.)
   
• Normal Retirement Formula:

.

• Early Retirement Reduction:

Retirement Service Credit Overview:

• Retirement Service Credit Totals Are Used For Two Distinct Purposes:
  • Eligibility Determinations.
  • Benefit Calculations.
     
• There are three different types of Tier II/IIA service credit: Actual State Service, Vesting Service, and Credited Service.
  • Actual State and Vesting Service are used to satisfy the various TIER II/IIA eligibility requirements.
  • Credited Service is used to calculate the amount of your Tier II/IIA benefit.
  • If you have been continuously employed with no part-time service, no leaves of absence, and no periods of purchased or additional service, your service credit total should be the same under each of the three measurements.
     
• The following is a general explanation of the significant differences between the three different Tier II/IIA service credit totals:
   
  • Actual State Service is determined by the strictest of the service credit calculations.
    • For the most part, this service credit total includes only periods for which you actually received state pay.
    • Actual State service is only important in satisfying the minimum 5-year eligibility requirements.
       
  • Credited Service is determined by a more generous service credit calculation.
    • In addition to recognizing periods of Actual State Service, this service credit total recognizes certain leaves of absence and/or periods of additional service.
    • It is important to note, however, that Credited Service is the only service credit total that will be reduced to a full-time equivalent if you have had periods of part-time service.
    • Credited service is used to calculate the amount of your pension.
       
  • Vesting Service is determined by the most generous service credit calculation.
    • In most cases, this service credit total recognizes periods of Actual State and Credited Service as well as any breaks in state service (a separation and re-employment) of less than one-year.
    • Vesting service is used to satisfy the minimum 10-year eligibility requirement; and to satisfy the 25-year service requirement to establish a normal retirement age of 60.
       
  • Please refer to the applicable summary plan description for further information regarding the specifics for calculating the different types of service credit (Actual State, Vesting, and Credited):
    • Tier II SPD
    • Tier IIA SPD

Breaks in Service:

• Permanent Break:
  • Tier II and Tier IIA members will not receive any retirement credit for any state service preceding a permanent break in service.
  • A permanent break in service occurs if:
    • You are not vested, and
    • You have been out of state service for either 5 years, or the length of your prior vesting service (whichever is greater)
       

Retirement Service Credit:

• In General Terms, Retirement Service Credit INCLUDES:
  • Paid State Employment Provided the Period is not Succeeded by a Permanent Break
  • Credit for any unused vacation days upon your retirement/separation from state service.
  • Properly documented voluntary leave taken after 6/9/94 counts as free retirement service credit.
  • Additional Service
    • Please refer to the applicable summary plan description for further information regarding the potential types of additional retirement service credit:
      • Tier II Service Credit Chart
      • Tier IIA Service Credit Chart:
         
• In General Terms, Retirement Service Credit EXCLUDES:
  • Leaves of absence without pay which do not fall within the Tier II or Tier IIA retirement provisions.
    • Tier II members - receive free credit for properly documented leaves of absence without pay, which fall within the Tier II crediting provisions.
    • Tier IIA members - must pay retirement contributions in order to receive credit for any creditable leaves of absence without pay.
       
  • Periods for which you exclusively received non-creditable workers' compensation payments.
     
  • Periods of state service rendered prior to a permanent break.
     

Part-Time Service:

• If you have had part-time service, you should know that:
  • your part-time service will be treated as full-time service when determining your eligibility to retire.
     
  • your retirement income will be calculated to produce a benefit which reflects the portion of a full-time schedule that you worked throughout your state employment.
• Example:
  • Let's assume a member worked part-time at 50% of a full-time schedule for 10 years:
    • For determining eligibility, we will use 10 years.
       
    • However, when calculating the benefit percentage, we will use 5 years (the full-time equivalent of working 50% of full-time for 10 years).

Average Salary

• Your average salary is the average of your 3 highest paid years of service.
• Any period of 12 consecutive months equals one year.
• Although for the majority of retirees the average salary is the average of the last 36 months of employment, when calculating your average salary the three years don't have to be consecutive years or calendar years.
• A small percentage of retirees may find themselves subject to the 130% Cap provision:
  • When calculating your average salary, no one year's earnings can be greater than 130% of the average of the two preceding years.
  • Effective 7/1/2014, no one year's earnings can be greater than 150% of the average of the two preceding years when including mandatory overtime earnings.
  • An even smaller percentage of retirees may find themselves subject to IRS Compensation limits.

Breakpoint

• The breakpoint is a reference point built into the Tier II/IIA benefit formula.
   
• This figure increases by 6% each year. In the formula, use the breakpoint for the calendar year in which your severance from state service occurs.
   
• The following table shows the breakpoints through the year 2013:

Tier II/IIA Benefit Formula:

• The same formula is used to calculate a Tier II or Tier IIA retirement benefit.
   
• The amount of your monthly benefit is "defined" by a formula which takes into account your age, your years of retirement service credit; your average salary; and a statutory reference point referred to as the breakpoint.
   
• The formula above does not apply to vested members who left state service prior to July 1, 2013.

Cost of Living Adjustment

• Your pension is subject to an annual Cost of Living Adjustment (COLA).
   
• These cumulative raises will be paid each year on either January 1st or July 1st depending on your date of retirement (DOR).
   
• You must be retired at least 9 full months in order to qualify for your first raise.
   
• Thereafter, your annual cost of living adjustment will be paid on the COLA anniversary date, which corresponds with your DOR.
   
• Your COLA will range from a minimum of 2% to a maximum of 7.5% based on the following formula which takes into account a portion of the increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the 12 months immediately preceding your COLA anniversary date:

60% of the annual CPI-W increase up to 6%

PLUS

75% of the annual CPI-W above 6%