Learning About Your Pension Plan
From the first day of employment, all employees are automatically enrolled in the Public School Employee Retirement System (PSERS) defined benefit (DB) pension program. Employees scheduled to work 25 hours or more a week are considered members of PSERS from day one of employment and are required to contribute to the pension. Although pension contributions are deducted, employees paid hourly or daily (per diem) are not considered members of PSERS until they work 500 hours (hourly employees) or 180 days (daily/per diem employees) in one school year. Members are not permitted to waive pension enrollment.
Hourly and Daily Paid Employees
Hourly and daily paid workers who choose to remain enrolled and do not work the 500 hours or 180 days respectively will receive a refund of contributions from PSERS annually. PSERS will notify you once you should expect the refund.
Waiving Enrollment
Employees scheduled to work less than 25 hours a week and employees paid on an hourly or daily basis may waive enrollment. To waive enrollment, register for PSERS Member Self-Service Portal and initiate your waiver. PSERS will review your request to waive, and if approved, will notify the Pension Department. The Pension Department will stop all future deductions and reimburse you for deductions already taken.
Pension Contributions from Your Pay
The chart below outlines the contribution rate for each pension class enrollment. Your pension class enrollment is dependent upon the first time you contributed to PSERS. Those who contributed prior to July 1, 2019 are enrolled in either classes: TC, TD, TE or TF and have a stand-alone pension plan contributing only to PSERS. Employees who contributed to PSERS for the first time on our after July 1, 2019 are enrolled in either one of two hybrid plans contributing to both PSERS and Voya Financial, Class TG or Class TH or in a stand-alone plan that does not have a pension contributing only to Voya.
| Membership Class | Contribution Rate |
|---|---|
| T-C | 5.25% |
| T-C | 6.25% |
| T-D | 6.50% |
| T-D | 7.50% |
| T-E | 8.00% with “Shared Risk” |
| T-F | 10.80% with “Shared Risk" |
| T-G | 9.00% with “Shared Risk" |
| T-H | 8.25% with “Shared Risk" |
| DC | 7.50% with “Shared Risk" |
If you are unsure of your pension class enrollment, you may either register for the Member Self Service portal with PSERS. You will need your PSERS ID which can only be obtained directly from PSERS or on any documents received in US Mail or email from PSERS. Or you may contact PSERS at 1-888-773-7748.
Shared Risk Pension Classes
Shared risk means that the rate of your pension class can increase or decrease every three years. It will not increase or decrease more than .75 at a time or may not change at all. You will be notified by both PSERS and the SDP if there is a change in the rate of your pension class. The table below outlines the base rate and the highest and lowest the rate can go every 3 years. For more information on the “Shared Risk Clause” please visit Shared Risk. If your class enrollment does not indicate “shared risk” this means the rate of your pension class is locked at that rate permanently.
| Membership Class | PSERS DB Base Rate | Shared Risk/Gain Increment (Every 3 Years) | Min Rate | Max Rate | DC Component |
|---|---|---|---|---|---|
| T-E | 7.50% | +/-0.50% | 5.50% | 9.50% | NA |
| T-F | 10.3% | +/-0.50% | 8.30% | 12.30% | NA |
| T-G | 5.50% | +/-0.75% | 2.50% | 8.50% | 2.75% |
| T-H | 4.50% | +/-0.75% | 1.50% | 7.50% | 3.00% |
Employer Matching
The SDP does not match contributions to your pension DB plan with PSERS. This means the SDP does not contribute anything on your behalf. This is because the SDP pays over 30% of all employees’ pre-taxed salary to maintain the pension program for 20,000+ employees’ benefit.
The SDP does match contributions to your Voya defined contribution (DC) plan. Please see below for the rate that the SDP contributes on your behalf. This is based on pre-tax salary and is contributed on your behalf on each pay.
Pension Class Enrollment
The rate associated with each class is the percentage of your pre-tax salary that is deducted each pay.By default, members contributing for the first time effective 7/1/2019 to the present are enrolled in pension Class TG. New members have 90 calendar days from the first day worked, to enroll in one of two other pension classes: Class TH and Class DC. Switching to a different class is a lifetime enrollment that is irrevocable. If a new member does not switch to a different class, PSERS will assume you want to remain in Class TG which is also a lifetime, irrevocable enrollment.
| Class T-G (Default) Hybrid Plan | Class T-H Hybrid Plan | Class DC Standalone Plan (no DB/pension ) |
|
|---|---|---|---|
| Total Member Contribution Rate | 9.00% (DB: 6.25% + DC: 2.75%) | 7.50% (DC: 7.50%) | 8.25% (DB: 5.25% + DC: 3.00%) |
| Employer Contribution Rate to Member's DC Account Only | 2.25% | 2.00% | 2.00% |
Vesting
Vesting with PSERS
Vested in your PSERS DB Plan means you are eligible for a monthly retirement benefit after termination of employment.
Vesting with Voya
In order to be vested with Voya, you must be enrolled in classes TG, TH or DC and contribute to your Voya plan for at least 3 school years. If vested, you are entitled to all that you contributed and what the SDP has contributed on your behalf.
Your membership class determines vesting as follows:
| MEMBERSHIP CLASS | EMPLOYMENT PERIOD | VESTING |
|---|---|---|
| T-C | Prior to July 22, 1983 | You are age 62 or older with at least one year of service at termination of employment. |
| T-C | On or after July 22, 1983 | You have at least five (5) years of service with at least one (1) year of qualifying service rendered after July 1, 2001 |
| T-D | Prior to July 22, 1983 | You have at least five (5) years of service with at least one (1) year of qualifying service rendered after July 1, 2001 |
| T-D | On or After July 22, 1983 | You have at least five (5) years of service with at least one (1) year of qualifying service rendered after July 1, 2001 |
| T-E | On or After July 1, 2011 | You have at least 10 years of qualifying service or you are age 65 or older with at least three (3) years of service at termination of employment. |
| T-F | On or After July 1, 2011 | You have at least 10 years of qualifying service or you are age 65 or older with at least three (3) years of service at termination of employment. |
| T-G | On or After July 1, 2019 | For the DB acct with PSERS: You have at least 10 years of qualifying service. For the DC acct with Voya: You have at least 3 years of qualifying service. |
| T-H | On or After July 1, 2019 | For the DB acct with PSERS: You have at least 10 years of qualifying service. For the DC acct with Voya: You have at least 3 years of qualifying service. |
| DC | On or After July 1, 2019 | You have at least 3 years of qualifying service. |
If you are not vested with neither PSERS nor Voya, you will be entitled to a refund of only what you contributed.
Supplemental Retirement Plan Options Contributions
Employees enrolled in any of the pension classes contributing to Voya have the option to contribute post tax. These savings are not eligible to be withdrawn for any reason while working. If you are interested in wanting to contribute to a post-tax retirement plan that you may be eligible to withdraw while working, we encourage opening a Roth 403b. More about the 403b plans can be found on our Benefits page here.
Borrowing from Your Pension
You may not borrow from your pension with PSERS, your account with Voya, nor any after tax contributions made to a Voya account while still an employee for the SDP. You must be separated from service and not contributing from any other entity to PSERS to access these accounts.