Monthly Payment Options

If you are actively considering retirement or are planning to retire within two years, please call 1.800.633.5461.

After you meet certain vesting criteria, your SERS membership entitles you to receive a pension payment every month for as long as you live. The annual amount of the payment is determined by a pension formula set forth in the Retirement Code. The payment is not influenced by how much your employer contributes or the performance of SERS' investments. It will, however, be reduced if you choose to retire before the SERS normal retirement age specified by your class of service.

Once your maximum annual retirement allowance is calculated, SERS determines how much money will be necessary to pay this amount to you for the expected lifetime of a person of your age. This is called your "present value."

Your actual monthly payment will be based on the payment option you select when you retire. Regardless of the option you choose, your monthly payment will continue for your lifetime.

A high-level overview of these options is provided below. You can see more specifically how they might affect your own payment by using the custom calculator provided in SERS online member services.

Maximum Single Life Annuity Option

This provides the highest monthly payment for as long as you live. Payments stop when you die. If we have not yet paid you as much as you contributed to SERS, plus 4% at the time of your death - also called your "accumulated deductions" or your "lump sum" - we'll pay the difference to your beneficiary or estate.

Option 1

This provides you with a smaller monthly payment for as long as you live. Payments stop when you die. Then, if we have not yet paid you as much as we calculated would be necessary for your expected lifetime at the time of your death - the present value - we'll pay the difference to your beneficiary or estate. Some people find it helpful to think about this like a checking account; you start with a set amount and it is reduced by each monthly payment.

Option 2

This provides you with a monthly payment for as long as you live. Then, when you die, it pays a person of your choosing - a "survivor" - the same amount that you were receiving each month for as long as he or she lives.

If you select this option, your monthly payment will be smaller because we calculate the amount that would be necessary to pay specified payments for both of your expected lifetimes, taking into account both of your ages at the time of your retirement. If you choose this option, you cannot change it later unless your survivor dies before you do or you get married or divorced.

Option 3

This provides you with a monthly payment for as long as you live. Then, when you die, it pays a person of your choosing - a "survivor" - half of the amount that you were receiving for each month for as long as he or she lives.

If you select this option, your monthly payment will be smaller because we calculate the amount that would be necessary to pay specified payments for both of your expected lifetimes, taking into account both of your ages at the time of your retirement. If you choose this option, you cannot change it later unless your survivor dies before you do or you get married or divorced.

Option 4

This provides you with an option to craft your own payment scenario, provided that it is certified to be actuarially equivalent to your maximum single life annuity and is approved by SERS prior to your retirement. If you are interested in this option, you are strongly encouraged to contact SERS at least 45 to 90 days prior to your desired retirement date.

The most common use of option 4 is for SERS members whose class of service allows the withdrawal of some or all of their own contributions plus interest upon retirement. When doing so, your present value and monthly payments are reduced. Another common use is for SERS members who would like to provide a survivor benefit that is different from 100% or 50% of the retiree's monthly pension amount.

This option can include death benefit or survivor payments, if you choose. To explore this option, please call 1.800.633.5461.