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Service
Retirement Benefits
You are eligible to receive a
monthly retirement benefit when you reach age 65 or meet the following age and service
requirements:
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Service Retirement Benefit |
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Minimum Service Credit
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Minimum Age |
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Age and Service = 80 years or more |
55** |
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* Age 55 for members
hired on or after July 1, 2005.
** Age and service must equal
85 years or more for members hired on or after
January 1, 2007. |
Your retirement benefit is the higher of a
defined benefit calculation or a money purchase retirement benefit
calculation. (If you have less than 5 years of service, you are only eligible for a money purchase
benefit at age 65.)
Defined
Benefit Calculation
A defined benefit
calculation is based upon your years of
service, age, and HAS. The
defined benefit is 2.5 percent of HAS for each year of service credit up
to 100 percent.
You may retire sooner with a reduced service retirement benefit
with the age and service requirements listed below:
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Reduced Service Retirement Benefit |
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Minimum Service Credit
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Minimum Age |
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If you meet the eligibility for a reduced service
retirement benefit, your defined benefit is calculated the same as for a service
retirement, then decreased for each month prior to your first eligible (unreduced)
service retirement date. See the HAS Percentages
Tables page for percentages.
Money Purchase Retirement Benefit
Calculation
The money purchase
calculation is determined by the value of your account at the time you apply for retirement, plus a matching amount equal to 100 percent
of contributions and interest, and life expectancy. This benefit is
advantageous to you if you terminate employment with a PERA employer and do
not withdraw your account.
Benefit Options
When you apply for a retirement benefit, you will
choose one of the following benefit options. In making the selection,
you should consider your age, financial obligations, health, income from
other sources, and needs of a spouse or other person that may be named as a cobeneficiary. If
you choose Option 2 or 3, you will select a cobeneficiary who
will receive a continuing benefit after your death. Only one cobeneficiary
may be chosen.
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Option 1: |
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This option
provides a lifetime monthly benefit. Following your death, a single payment of any remaining balance
in your PERA member contribution account, plus a 100
percent match on the balance, will be made to your named beneficiary, or a your estate if no named beneficiary exists. No further monthly
benefits are payable. |
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Option 2: |
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This option also
provides a lifetime monthly benefit. Following your death, your cobeneficiary will receive a lifetime monthly benefit equal to one-half
of the benefit you were receiving at the time of death. If there
is an account balance after the death of your cobeneficiary, a single
payment of any remaining balance in your PERA member contribution account,
plus a 100 percent match on the balance, will be made to your named beneficiary, or
your estate if no named beneficiary exists. No further monthly
benefits are payable. |
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Option 3: |
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Like Option 2,
this option also provides a lifetime monthly benefit. Following your death,
your cobeneficiary will receive a lifetime monthly
benefit equal to the monthly benefit you were receiving at the time of death.
If there is an account balance after the death of your cobeneficiary, a
single payment of any remaining balance in your PERA member contribution account,
plus a 100 percent match on the balance, will be made to your named beneficiary, or
your estate if no named beneficiary exists. No further monthly
benefits are payable. |
Option 1 benefits are calculated
as a Defined Benefit or as a Money Purchase Retirement Benefit. Benefits under Options 2 and 3 are
calculated the same as Option 1, then reduced
to pay for
continuing benefits to the person you select as your cobeneficiary.
The factors used to calculate Options 2 or 3 may change whenever
actuarial assumptions are changed. If
you select Option 2 or 3 and your cobeneficiary dies before you,
your benefit will
change to the Option 1 amount.
See
Calculating a PERA Retirement Benefit
for Option 1, 2, and 3 benefit calculation examples.
Factors That
May Affect Your Benefit Amount
HAS Calculations for Retirements on or After
January 1, 2009
If you began PERA membership on or before December 31, 2006, the method used to calculate your HAS will change effective January 1, 2009. There are two changes that may impact your HAS:
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A base salary year (your 4th highest
salary year) will be used to
determine the starting point of the 15 percent annual
salary increase limitation on the 3-year HAS
calculation for benefit determination purposes; and
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The 15 percent annual limitation will
apply regardless of when the annual salaries in
your HAS occurred.
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If you began PERA membership on or after January 1, 2007, your annual salary increase limit is 8 percent and the new method for calculating your HAS is effective for calculations as of January 1, 2007.
While few members will be impacted by the new calculation method, if you plan to retire in the next year and your anticipated retirement dates are both before and after January 1, 2009, request an estimate of benefit prior to January 2009 to determine how the new HAS calculation will effect your benefit.
Furlough Days
Some
Colorado PERA-affiliated employers have required their employees
to take furlough days (days off without pay). The reduction in a
member's salary for these days off may lower the HAS used to
calculate a member's retirement benefit.
If you
had a salary reduction due to furlough days from July 1, 2002,
to June 30, 2004, you may opt to make contributions on the
amount that the salary was reduced. These optional contributions
will, in many cases, increase your HAS.
See the
Colorado PERA & Furlough Days
fact sheet for more information.
Federal
Limits on Benefits
An Option
1 benefit can never exceed 100 percent of HAS and federal law
places other limits on the annual amount of retirement benefits
that PERA retirees may receive under Internal Revenue Code (IRC)
Section 415(b).
If your annual benefit is expected to exceed $79,422 in 2008,
federal law may limit what PERA can pay you in a benefit. The
calculation of benefit limits is complicated and depends upon
the age of the member, any tax-paid PERA contributions, any
service credit purchased with tax-paid money, and other factors.
See the
Federal
Limits on Benefits page for more information.
PERA Benefits and Domestic
Relations Orders
If
a you have a valid domestic relations order (DRO) on your
account, part of the monthly benefit will be paid to you
and part will be paid to the alternate payee (your ex-spouse) as
specified in the DRO.
See the
Divorce and Domestic Relations
Orders page for more information.
PERA Funds and Legal Process
PERA retirement benefits can only be subject
to legal process for federal and Colorado State tax liens, assignments for child
support purposes, garnishments for child support arrearages or
child support debt, and valid domestic relations orders.
PERA retirement benefits are also
subject to attachment for restitution for theft, embezzlement,
misappropriation, or wrongful conversion of public property.
Attachment is also allowed in the event of a judgment for a
willful and intentional violation of fiduciary duties where the
offender or a related party received direct financial gain. PERA
benefits are not otherwise subject to execution, levy,
attachment, garnishment, or bankruptcy proceedings and cannot be
assigned voluntarily or involuntarily.
View, print
or order the PERA
Retirement Process booklet
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