Most NYSLRS members contribute a percentage of their earnings to help fund pension benefits. For Tier 6 members (those who joined NYSLRS on or after April 1, 2012), that percentage, or contribution rate, can vary from year to year.
When Tier 6 Contribution Rates are Determined
A Tier 6 member’s contribution rate is calculated annually. New rates become effective each year on April 1, the beginning of the State’s fiscal year. Once your rate is set for a fiscal year, it will not change for the rest of that fiscal year. However, depending on your earnings, it may change the following year.
How Your Tier 6 Contribution Rate is Calculated
As a Tier 6 member, your contribution rate is based on how much you earn. Changes in your earnings may result in changes to your rate. The minimum rate is 3 percent of your earnings, and the maximum is 6 percent.
During your first three years as a NYSLRS member, your contribution rate is based on an estimated annual wage we receive from your employer. After three years, the rate is based on what you actually earned two years earlier. If you are a Tier 6 member with three or more years of membership in NYSLRS, this video will help explain how your contribution rate is determined:
The amount you contribute to the Retirement System will not affect the amount of your pension. Your NYSLRS pension is a lifetime benefit based on your retirement plan, years of service and final average earnings. You can learn more about your pension by reading your plan booklet on our Publications page. For help finding the right plan book, read our blog post Knowing Your Retirement Plan is the Key to Retirement Planning.
Information is the key to being fully prepared for your retirement years. The single most important thing you can do to achieve this goal is to know what NYSLRS retirement plan you’re in. Once you know that, the next thing you must do is understand the benefits your plan provides.
Your retirement plan booklet covers things like how long you’ll need to work in order to receive a pension, how your pension amount is determined, and what kind of death and disability benefits may be available to you. You can find a copy of your plan booklet on our website’s Publications page.
But here’s the challenge: NYSLRS manages 335 retirement plan combinations, which are described in 51 plan booklets. How do you figure out which is yours? The information below should help.
Two Key Questions
To get started, you need to answer two questions.
Question One: Which retirement system are you in? NYSLRS is made up of two different systems:
The Employees’ Retirement System (ERS), which is for public employees in non-teaching positions. It also includes some law enforcement personnel, such as correction officers, sheriffs and sheriffs’ deputies.
The Police and Fire Retirement System (PFRS), which is for paid firefighters and police officers, including SUNY police, State Park police, Encon officers and State Forest Rangers.
Question Two: Which tier are you in? There are six tiers in ERS and five tiers in PFRS. Your tier, based on when you joined NYSLRS, determines such things as when you become eligible for benefits and how much you contribute. You can find your tier by checking your Account Information in Retirement Online or by checking the NYSLRS website.
For many members, knowing your retirement system and tier are enough. But for other members, especially those in law enforcement, it may help to have your retirement plan number as well. The plan number indicates the section of Retirement and Social Security Law the plan is based on. For example, Plan A15 indicates that you are covered by Article 15. You can find your plan number in the Account Information section of Retirement Online.
Roughly three-quarters of all ERS members are covered by Article 15; they just need to know their tier to find the correct booklet.
If you are still unsure which retirement plan booklet covers your benefits, you can send us an email using our secure contact form, or you can ask your employer.
Take the Time to Understand Your Retirement Plan
It cannot be stated enough how important it is to read your plan publication to learn all you can about your benefits. It is the key to solid retirement planning. Remember, no one has a more vested stake in your retirement than you do.
Most members can get a NYSLRS loan using Retirement Online. Loan eligibility requirements are based on your tier, but generally, you’ll need to be on the payroll of a participating employer, have at least one year of service and have a certain amount of contributions in your account. Retirement Online will provide the eligibility information you need as you step through the application process.
Retirement Online is the fastest way to get a NYSLRS loan. It’s also an easy way to find out your current loan balance, the amount you are eligible to borrow and more. If you don’t already have an account, go to the Sign In page and click “Sign Up” under the Customer Sign In button. (Need help with Retirement Online? See this post for handy tips.)
The Application Process
Once you’ve signed in, scroll down to ‘My Account Summary.’ Under ‘I want to…’ click the green “Apply for a Loan” button and follow the prompts.
As you work your way through the online application, you’ll see how much you can borrow, the minimum repayment amount, the expected payoff date and how much you can borrow without tax implications.
NYSLRS loans are exempt from New York State and local income taxes. However, the Internal Revenue Service may consider all or part of a NYSLRS loan taxable in some cases – for instance, if you borrow above certain limits. The Retirement Online loan application will show you the maximum amount you can borrow without tax implications.
If you already have a loan and you want to take another loan, you can take multiple loans or refinance an existing loan. Taking a new loan (the multiple loan option) minimizes your potential tax consequences. Your minimum payment will be higher, but you will pay off your loans faster than you would by refinancing. Refinancing adds the new loan amount to your existing balance and spreads the entire balance over a new five-year term. Your payment will be lower but your tax consequences may be significantly higher.
Repaying Your NYSLRS Loan
Loan payments will be deducted from your paycheck. You can choose the minimum payroll deduction, which would pay off your loan in five years, or you can choose to pay more than the minimum to pay off your loan sooner. The payment calculator in Retirement Online will provide your expected payoff date if you enter an amount higher than the minimum.
If you already have loan from NYSLRS, during this time of economic uncertainty you may be considering whether you can defer your NYSLRS loan payment.
If you are furloughed or on an authorized leave of absence with your employer, the IRS allows for the suspension of loan payments for up to one year from the date your leave began or until you return to the payroll (whichever occurs first). To receive this deferment, have your employer send us a fax (518-486-9877) on their letterhead that indicates the date your leave began and when they expect it will end.
It’s important to note that if you defer your loan payments during an authorized leave of absence, your payments will need to be recalculated and increased upon your return. This will ensure your loan will be paid off within the five-year period.
For more information, including how retiring with an outstanding loan would affect your pension, visit our Loans page. If you need help with the self-service loan application, click “Help” at the top of your account page. Then click next to ‘Requesting a Loan’ and select the step-by-step guide that best fits your situation. Retirement Online is generally available from 7:00 am to 9:30 pm on Monday, Wednesday, Thursday and Friday; from 7:00 am to 6:00 pm on Tuesday; and from 6:00 am to 11:00 pm on Saturday and Sunday.
NYSLRS, which comprises the Employees’ Retirement System (ERS) and the Police and Fire Retirement System (PFRS), had 673,336 members as of March 31, 2020. Our members are State government, local government and school district employees from across New York, including 637,746 in ERS and 35,590 in PFRS. Seventy-nine percent of our members were active, which means they were on a public payroll as of March 31.
NYSLRS Membership Over Time
A decade ago, nearly 90 percent of NYSLRS members were in Tiers 3 and 4. Now, those tiers represent less than half of our membership, while Tier 6 members are on the verge of surpassing them. Tier 6, which includes members who joined NYSLRS since April 1, 2012, has 298,633 members, or 44.4 percent of total membership.
Here’s a look at our NYSLRS membership by tier, as of March 31:
Tier 1: NYSLRS’ oldest tier, whose members first joined the system before July 1, 1973 (July 31, 1973 for PFRS members), is dwindling. Tier 1 represented only 0.2 percent of our membership. There were only 1,552 Tier 1 ERS members and 24 Tier 1 PFRS members.
Tier 2: With 22,262 members, Tier 2 represented 3.3 percent of membership. Ninety-two percent of Tier 2 members were in PFRS.
Tiers 3 & 4: Tiers 3 and 4, which have similar retirement plans, had 311,213 members, 46.2 percent of the total membership. Tiers 3 and 4 are primarily ERS tiers. There is no Tier 4 in PFRS, and only 228 PFRS members were in Tier 3.
Tier 5: Tier 5 covers members who joined from January 1, 2010 through March 31, 2012. With 39,652 members, Tier 5 represented 5.9 percent of membership.
Tier 6: This tier covers members who joined since April 1, 2012. Its ranks grew by 15 percent during the last fiscal year.
But NYSLRS is more than just the pension fund. The system had 673,336 members as of March 31, including county workers, professional firefighters and State troopers. Here are some facts about our membership:
530,547 active members (that is, members still on a public payroll) work for 2,962 public employers statewide.
One-third of those active members work for New York State. The rest work for counties, cities, towns, villages, school districts and public authorities.
Nearly 94 percent of active members are in the Employees’ Retirement System (ERS). The Police and Fire Retirement System (PFRS) accounts for 6 percent of NYSLRS membership.
More than 44 percent of all members are in Tier 6. Fifty-eight percent of PFRS members are in Tier 2 and almost 49 percent of ERS members are in Tiers 3 and 4.
NYSLRS Retirees and Beneficiaries
The average pension for an ERS retiree was $25,105; the average for a PFRS retiree was $54,684. But these pension payments don’t just benefit the system’s retirees and beneficiaries. Because 79 percent of NYSLRS retirees and beneficiaries live in New York, $10.8 billion worth of benefits stayed in the State. And that money supported local businesses, paid local taxes and generated economic development statewide.
An Award-Winning Publication
Extensive information about NYSLRS members and retirees, the Fund, and Fund investments can be found in the 2020 Comprehensive Annual Financial Report (CAFR). NYSLRS once again received the Certificate of Achievement for Excellence in Financial Reporting for the 2019 CAFR. The Certificate of Achievement is a national award recognizing excellence in the preparation of state and local government financial reports. NYSLRS has won this award for the last 16 years.
NYSLRS is actually two retirement systems: The Employees’ Retirement System (ERS) and the Police and Fire Retirement System (PFRS).
PFRS, which provides retirement benefits for police officers and paid firefighters, is the smaller of the two systems, with about 35,000 members. Roughly a third of PFRS members work for cities, while 20 percent work for New York State. The remainder work for towns, counties and villages.
There are five tiers in PFRS, reflecting when the members joined the system: Tiers 1, 2, 3, 5 and 6 (there is no Tier 4). Tier 2, which includes PFRS members who joined the Retirement System from July 31, 1973 through June 30, 2009, is the largest tier, accounting for almost 60 percent of membership. If you joined PFRS on or after April 1, 2012, you are in Tier 6.
The vast majority of PFRS members (98 percent) are in special retirement plans that allow for retirement after 20 or 25 years of creditable service. If you are in one of these plans, once you have the full amount of required service, you can retire at any age.
Some PFRS members are in regular retirement plans, which require a member to reach a certain age before they are eligible for a pension.
As a PFRS member, you’ll pass a series of important milestones throughout your career. Knowing and understanding these milestones will help you better plan for your financial future.
Service credit is a key in determining your eligibility for a pension and other benefits, including the amount of those benefits.
Under most 20- and 25-year plans, not all public employment is creditable. Usually, police and firefighting service can be counted as special-plan service. You may also be able to use military service to help you reach 20 or 25 years. If you have questions about the service that can be used to calculate your pension, please check your retirement plan booklet or contact us.
PFRS Plan Booklets
You can find details about your NYSLRS benefits in your retirement plan booklet.
For the majority of PFRS members, that’s the Special 20- and 25-Year Plans booklet. This booklet is for PFRS Tier 2, 3, 5 and 6 members covered by Sections 384, 384-d and 384-e of the State Retirement and Social Security Law.
Need information about your personal NYSLRS account? You can find answers quickly and easily with Retirement Online.
Many of you know that Retirement Online is the convenient way to do business with NYSLRS. It’s also the fastest way to access account-specific information. Just sign in to your account for the most up-to-date information we have on file for you.
You can find your NYSLRS ID and contact information. Moved recently and not sure we have your current address? Retirement Online allows you to quickly check and update your mailing address, email address and phone number.
Member Information in Retirement Online
If you’re an active member (not yet receiving a NYSLRS pension) you can also find:
Details about your federal tax withholding, including your withholding status, number of exemptions and the amount of any additional withholding; and
Your beneficiary designations.
Sign Up Today
Hours of availability have recently been expanded. Retirement Online is generally available on Monday, Wednesday, Thursday, and Friday, from 7:00 am to 9:30 pm, and on Tuesday from 7:00 am to 6:00 pm. On Saturday and Sunday, it is available from 6:00 am to 11:00 pm. (Closed for maintenance on the 1st and 3rd Sunday of each month.)
For some NYSLRS members, your retirement age matters when it comes to receiving your NYSLRS retirement benefits.
Your pension will be based largely on your years of service and final average earnings, but your age at retirement is also a factor. How age plays into the equation depends on your tier and retirement plan.
Members in regular retirement plans can retire as early as age 55, but they may face significant pension reductions if they retire before their full retirement age. The full retirement age for members in most tiers is 62, and it’s 63 for Employees’ Retirement System (ERS) Tier 6 members and for Police and Fire Retirement System (PFRS) Tier 6 members who leave public employment before retirement age, but have enough service to receive a pension. If you joined NYSLRS on or after April 1, 2012, you are in Tier 6.
Benefit reductions are prorated by month. The closer you are to your full retirement age when you retire, the less the reduction will be. Here are some examples of how that would work.
ERS Tiers 2, 3 and 4, PFRS Tiers 2, 3 (Article 11), 5 and 6:If you retire at age 58 1/2, your pension will be permanently reduced by 16.5 percent.
ERS Tier 5: If you retire at age 58 1/2, your pension will be permanently reduced by 20.83 percent.
ERS Tier 6: If you retire at age 58 1/2, your pension will be permanently reduced by 29.5 percent.
Once you retire with a reduced benefit, the reduction is permanent — it does not end when you reach retirement age.
Retirement Age Exceptions
Tier 1 members can retire at 55 without a benefit reduction. Benefit reductions don’t apply to ERS Tier 2, 3 or 4 members if they retire with 30 years of service. Tier 5 Uniformed Court Officers and Peace Officers employed by the Unified Court System can also retire between 55 and 62 without penalty if they have 30 years of service.
Understanding how age affects your NYSLRS benefits is crucial to retirement planning. To learn more, please review your retirement plan booklet on our Publications page.
You can check your service credit total and estimate your pension using Retirement Online. Most members can use our online pension calculator to create an estimate based on the salary and service information NYSLRS has on file for them. You can enter different retirement dates to see how your choices would affect your potential benefit.
Tier 6 members (those who joined NYSLRS since April 1, 2012) are eligible for a lifetime pension benefit once they’ve earned 10 years of credited service. And that pension can replace a portion of your salary throughout your retirement.
Your NYSLRS pension will be based on your Final Average Earnings (FAE) and the number of years you work in public service. FAE is the average of the five highest-paid consecutive years. For most members, those higher-paid years come at the end of their careers. Since retirement is still some years in the future for most of you, we won’t focus on the dollar amount of your FAE today. But we can look at what percentage of that salary would be replaced by your pension if you continue in the system until retirement age.
For Tier 6 members of the Employees’ Retirement System (ERS), the benefit is 1.66 percent of your FAE for each year you work, up to 20 years. (Benefit calculations for members of the Police and Fire Retirement System vary based on plan.) At 20 years, the benefit equals 1.75 percent per year (for a total of 35 percent). After 20 years, the benefit grows to 2 percent per year.
Financial advisers say you will need to replace between 70 to 80 percent of your salary to maintain your lifestyle during retirement. Let’s see how we can get there.
NYSLRS Pension: Say you begin your career at age 30 and work until your full retirement age of 63. That’s 33 years of Service Credit. You’ll get 35 percent of your FAE for the first 20 years, plus 26 percent for the last 13 years, for a total benefit that would replace 61 percent of your salary. If you started at age 25, and continue till 63, you’d get 71 percent of your FAE. If you didn’t start till age 35, you’d still get 51 percent at 63.
Social Security: You also should factor in Social Security. According to the Social Security Administration, Social Security now replaces about 36 percent of the wages of a typical worker who retires at full retirement age. In the future, it’s estimated that Social Security might still replace between 25 and 30 percent of a typical worker’s pay.
Savings: Retirement savings can also replace a portion of your income. How much, of course, depends on how much you save. The key is to start saving early so your money has time to grow. New York State employees and some municipal employees can participate in the New York State Deferred Compensation Plan. If you haven’t already looked into Deferred Compensation, you might consider doing so now.
This COLA is a permanent annual increase to your retirement benefit. It is based on the cost-of-living index and is designed to address inflation.
How COLA is Determined
The law requires that COLA payments, subject to certain limitations, equal 50 percent of the previous year’s inflation rate, but are never less than 1 percent or more than 3 percent of your benefit. The adjustment is applied to the first $18,000 of your Single Life Allowance, even if you selected a different pension payment option. Once COLA payments begin, you will receive an increase to your monthly benefit each September.
The September 2020 COLA equals 1 percent, for a maximum annual increase of $180.00, or $15.00 per month before taxes.
Who is Eligible for a COLA?
To begin receiving COLA payments, you must be:
Age 62 or older and retired for five or more years; or
Age 55 or older and retired for ten or more years (uniformed employees such as police officers, firefighters and correction officers covered by a special plan that allows for retirement, regardless of age, after a specific number of years); or
A disability retiree for five years; or
The spouse of a deceased retiree receiving a lifetime benefit under a pension payment option elected by the retiree. An eligible spouse is entitled to one-half the COLA amount that would have been paid to the eligible retiree when the retiree would have met COLA eligibility; or
A beneficiary receiving the accidental death benefit for five or more years on behalf of a deceased Retirement System member.
When Will You See the Increase?
Eligible retirees will see the first 2020 COLA payment in their September pension payment. It will be available to those with direct deposit on September 30, 2020. If you receive a paper check, the COLA will be included in the check to be mailed September 29, 2020.
You can sign in to your Retirement Online account to view a current breakdown of your pension payment. If you have direct deposit and are eligible for a COLA increase, you will receive notification of the net change in your monthly payment amount in September.
If you are not eligible for a COLA yet, you will receive your first increase in the month after you become eligible. This payment will include a prorated amount to cover the month you became eligible. After that, you will receive a COLA increase each September.