Service Credit for State of Texas Retirement Group 4
The information on this page is for ERS members in Group 4, that is, who started working at a State of Texas agency on or after Sept. 1, 2022.
If you are in Group 1, 2 or 3, visit the service credit page for Groups 1 - 3 to learn how service credit is applied to your ERS retirement eligibility and annuity payment.
What is service credit?
Service credit is credit for time worked. It is a factor ERS uses to determine when you can retire. For Group 4 employees, service credit isn’t used to calculate your retirement annuity payment. ERS calculates your annuity payment based on the total balance in your ERS retirement account and your age when you retire.
Earning Service Credit to Become Eligible to Retire
You can earn service credit by contributing to the ERS Retirement Plan while working at a State of Texas agency. All state agency employees, except return-to-work ERS retirees and contracted/temporary employees, make a monthly contribution to the plan by direct deduction from their paycheck.
Using Withdrawn Service Credit
If you worked at a State of Texas agency before, left and withdrew your retirement account, then returned to State of Texas employment, you can use the service credit you withdrew in one of two ways:
- Within 24 months of returning to state employment, you can purchase withdrawn service credit to meet retirement eligibility and increase your annuity. You will pay ERS the entire amount you withdrew, and ERS will deposit the money in your retirement account. That will increase the balance in your account, which will increase your annuity when you retire. The sooner you purchase withdrawn service, the sooner the money will begin earning annual interest and any gain shares. In addition, ERS will add the withdrawn service credit to your current service credit, which will help you reach retirement eligibility sooner. The purchased service credit will also count toward your eligibility for insurance in retirement. Please note: You cannot purchase withdrawn service credit more than 24 months after you return to state employment.
- You can certify the withdrawn service credit as restricted prior service to meet retirement eligibility only. Restricted prior service will not increase your annuity or count toward your eligibility for retiree insurance. This costs you no money, and you can do it any time after returning to state employment. Please note: ERS cautions Group 4 members against just certifying withdrawn service credit to reach eligibility. Becoming eligible without increasing your account balance could mean a smaller annuity that doesn’t meet your needs in retirement.