Standard Annuity

The standard annuity option is the highest monthly payment available to you for your retirement payments. 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 service credit. 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

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 on or after September 1, 2013 (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.

Example: If Pat retires with 28 years of service credit, his service percentage is 64.4. That means his annuity will equal 64.4% of his highest average salary.
28 x 2.3% = 64.4%

Remember: Withdrawn service does not count toward your service credit unless you have purchased it.

Standard annuity

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.

Example: Pat retires with a highest average salary of $3,000 with 28 years of service credit (service percentage of 64.4%). Pat’s gross (before tax) standard annuity will be $1,932 per month.
3,000 x 64.4% = 1,932