Benefit Formula

There are several factors used to determine your retirement benefit. First we consider your length of service. Then we calculate your high-five average salary, using your highest five years of salary. We take these two pieces and apply it to a "benefit formula" to determine your retirement benefit.   The benefit formula is based a service-credit percentage and an aged-based factor.

 

Service-credit percentage
Service years and months are converted to a percent of your average monthly salary.

  • Years served starting January 1, 1979 and after; you receive 2.5% for each year of service.

  • Years served before January 1, 1979: you receive 5% for each year up to eight years and  2.5% for each year over eight years.
     

Example of how we calculate your benefit:

The assumptions - first entered service 1/1/1985

Age at retirement

 62

Allowable service

 12 years

Average monthly salary

 $3,083

 

The calculation

12 years x 2.5% = 30%

$3,083 (your average monthly salary)
X     30%

$925 computed monthly benefit*

*Please note: if you decide to end your legislative career and apply for retirement benefits prior to age 62, an early-retirement reduction will apply.

 


Aged-based factor applied
The computed benefit has an age-based factor applied, which was passed into law in 1997. This increases your benefit to compensate for slightly lower, future cost-of-living increases over your lifetime.

Example of how aged-based factor is applied:

The assumptions

 Age at retirement

 62

Allowable service

 12 years

Average monthly salary

 $3,083

Computed monthly benefit

 $925 (calculated in above example)

Age-based factor

 9.0% (currently)
 9.6% (effective July 1, 2014)

 

The calculation

$925 x 8.7% = $80

$925 (your computed monthly benefit)
+  80 (your age-based factor)

$1,005 monthly benefit *
 

* Please note: if you decide to end your legislative career and apply for retirement benefits prior to age 62, an early-retirement reduction will apply.