The standard annuity option is the highest monthly payment available to you for your lifetime. The standard annuity option stops when you pass away. If there is money left in your account after your death, your beneficiary receives a one-time lump sum payment.
Some employees can qualify for a lifetime retirement annuity with as little as five years of eligible service credit (Group 1 and Group 4); Groups 2 and 3 need ten years of eligible service credit to receive an annuity. With 10 years of service credit, health insurance benefits may be available. The longer you work for the state, the greater the benefits in retirement.
Highest average salary
For retirement groups 1 - 3, your standard annuity calculation begins with your highest average salary. You can calculate this by adding up your highest 36, 48 or 60 months of salary and dividing that number by 36, 48 or 60. The number of months to use depends on your hire date:
- If you were hired before September 1, 2009 (Group 1) and never withdrew your account at ERS, we use the average of your highest 36 months of salary.
- If you were hired between September 1, 2009 and August 31, 2013, (Group 2), we use the average of your highest 48 months of salary.
- If you were hired between September 1, 2013 and August 31, 2022 (Group 3), we use the average of your highest 60 months of salary.
The calculation of highest average salary includes base pay, longevity pay, Benefit Replacement Pay (BRP) and hazardous duty pay, if applicable.
Service percentage or multiplier
Every year you work, you get 2.3% of your highest average salary. We call this your service percentage.
Remember: Withdrawn service does not count toward your service credit unless you have purchased it.
The final step in figuring your standard annuity is multiplying your highest average salary by your service percentage. Your standard annuity cannot be more than 100% of your highest average salary.