TRF Member Handbook: Monthly Pension Benefit
Your retirement benefit has two parts: a monthly pension benefit and an Annuity Savings Account (ASA).
- You will receive a monthly benefit from TRF for the rest of your life. This benefit is paid for by the State or your employer.
- You also have an ASA. The money in your ASA is from the mandatory annual payment (3 percent of your annual salary). You or your employer makes these payments.
Your ASA includes any voluntary payments you make. It also includes any interest or earnings from investments. Unlike your monthly benefit, you are vested in the ASA right away.
If you are not retired, you can also create a Rollover Savings Account (RSA) by moving funds from an IRA or other qualified retirement plan into TRF.
Note: We can only accept transfers of taxable funds. You can refer to the Rollover Savings Account section of this handbook for more information.
When you have at least 10 years of service in a TRF- or PERF-covered position, you are considered vested.
To be vested means you qualify to receive a monthly pension benefit, once you meet age and service requirements (see below).
To apply for a regular (unreduced) retirement benefit, you must be:
- age 65 or older with at least 10 years of service credit,
- between age 60 and 64 with at least 15 years of service credit, or
- between age 55 and 59, if age and service credit total at least 85 (“Rule of 85”)
If you meet the age and service requirements for regular retirement, you will have a few payment options (see below). We use a different formula to determine your benefit, based on pension option.
If you choose the 5-Year Certain & Life pension option (formerly, the A-1 option), we calculate your annual pension benefit with the following formula:
|Average of Highest 5 Years of Annual Compensation x
Total Years of Service x 1.1% (0.011)
Retirement without Employer Separation
If you are a TRF or PERF member who:
- is no longer working in TRF or PERF-covered service with an employer;
- is actively working with the same employer; and
- is working in a non-TRF or non-PERF covered position,
You are entitled to retire from TRF or PERF and begin receiving retirement benefits if you are otherwise eligible for retirement and have reached normal retirement age.
For example, Steve is 62 years of age and has 15 years of PERF service as a state of Indiana employee. Steve is elected as a judge eligible for service in the Judges' Retirement System (JRS). Steve terminates his previous state of Indiana PERF covered employment and immediately begins serving as a judge participating in the JRS. Since Steve is age and service eligible for a PERF benefit, has reached normal retirement age, and has terminated his PERF covered position, he's eligible to begin receiving PERF retirement benefits even though he didn't separate from state employment.
You can retire early. You will receive a reduced amount of your normal annual pension benefit. You will receive this smaller amount for life.
You must be between age 50 to 59 to retire early. You must also have at least 15 years of service credit. See Table 2 (below) to find out how much less money you will receive if you retire early.
Table 2 – Early Retirement Percentage of Normal Annual Pension Benefit
|Age||Percentage of Benefit|
Age 70 Benefits (Millie Morgan)
If you are 70, you can start receiving your retirement benefit while still working in your TRF-covered position. You must also have at least 20 years of creditable service. Please note that this election cannot be changed. If you choose to start getting your retirement benefit while still working, you will not earn any more service credit toward retirement. You can still put money into your ASA. If you choose this option, you cannot withdraw the additional ASA contributions made after retirement until you end service.
The amount of your monthly pension benefit is based on the following factors:
- Benefit multiplier. This amount is 1.1 percent. It is used in the math formula to come up with your monthly pension benefit.
- Average annual compensation (yearly salary). This is the average dollar amount of your five highest yearly salaries. These are salaries you received working in a covered position.
- Years of service. Service credit you earned while working. You may also purchase service credit.
- Age at retirement. If you retire early, the amount of your monthly pension benefit will be less.
- Retirement option. You will have several options when you retire. The amount of your monthly pension benefit will change for each option.
|Final average salary||$50,000.00||$|
|Benefit multiplier||x .011||x .011|
|Pension base amount||550.00||$|
|Years of service||x 30||x|
|Annual retirement benefit||$16,500.00|
|Monthly benefit||/ 12||/ 12|
|Calculated as an A-1 option||$1,375.00||$|
You may calculate your own benefit estimate online here.
Other methods for calculating an estimated monthly benefit include:
- Login to your online account.
- Click on the TRF Pension tab.
- Select the Calculator “Estimate Retirement Benefit.”
- Fill in a retirement date. Click on “Apply Projected Retirement Date.”
- Answer the questions on beneficiary and social security.
- Click on “Calculate.”
You will receive an estimate of your monthly pension benefit.
From the TRF benefit estimate calculator, calculate an estimate by entering your projected retirement date, your final average salary and your years of service.
From the TRF benefit estimate calculator on this site or in your online account, calculate an estimate by using information from your latest Social Security statement. To qualify for this Social Security Integration payment option, you must be less than age 62 at retirement and you must enter your estimated Social Security income.
When you retire, you will be able to select one of six options for your monthly pension benefit. You may also be able to choose an option to add your social security to your benefit.* You can do this if you are less than age 62 when you retire. If you choose this option, your monthly payment may be less after age 62, or could even stop. Please contact us at (888) 286-3544 with questions.
Every option will give you a lifetime monthly benefit. When you pass away, some options let you provide lump sum benefits to a beneficiary or your estate. Or, you can name a survivor to receive a monthly benefit after your death. The choice you make will determine the amount of your monthly pension benefit.
*More information on Social Security benefits is available online here.
You may change your designated survivor and/or pension option at any time, for any reason.
- If your survivor is your spouse and he or she is living when you make the change, you must obtain his or her written consent.
- If you get divorced after you retire, your divorce decree must permit the change.
Your monthly pension benefit is exempt from seizure, levy, attachment, and other processes.
The only exception to this rule is garnishment by the IRS, state or your employer for certain criminal actions, or failure to pay taxes.
NOTE: TRF is a governmental plan. It is exempt from the provisions of the Employee Retirement Income Security Act (ERISA). Therefore, INPRS does not recognize Qualified Domestic Relations Orders (QDROs) as described in ERISA.
Five-Year Certain and Life (formerly A-1)
With this pension option, you get a lifetime monthly benefit. If you pass away before receiving five years of payments, your beneficiary will get that monthly benefit for the remainder of those five years. The beneficiary can also choose a lump sum equal to the present value of those remaining payments. Payments to the beneficiary stop at the end of that five year period.
Straight Life (formerly A-2)
You will get a monthly benefit for life, but there are no monthly payments to anyone after your death. However, if you combine your ASA with your pension check, there could be remaining ASA money. PERF will add up the monthly pension and ASA payments paid before your death. If the total of monthly payments is less than your ASA balance when you retired, your beneficiary will get the difference.
Modified Cash Refund Plus Five-year Certain and Life (formerly A-3)
To select this option, you must combine at least part of your ASA with your lifetime monthly pension benefit. If you die before receiving payments for five years, your beneficiary gets the pension part of your monthly benefit for the rest of those five years. The beneficiary could also choose a lump sum equal to the present value of the remaining payments. He or she would also get any remaining balance on your ASA.
Modified Cash Refund Plus Five-Year Certain and Life (formerly A-3)
This option is not available to members who choose to take a total payment of their ASA at retirement. However, if you choose a partial withdrawal of the ASA (a distribution of the 1986 Tax Basis), Modified Cash Refund Plus Five-year Certain and Life is available. Please note that your ASA balance is smaller with each monthly ASA benefit paid. Therefore, if you die after the account balance is zero, there will be no ASA payment to your beneficiary.
|Because survivor options (100 Percent Survivor Benefit, 66-2/3 Percent Survivor Benefit and 50 Percent Survivor Benefit, formerly options B-1, B-2, and B-3) provide for a survivor benefit, your monthly pension benefit is decreased.|
100 Percent Survivor Benefit (formerly B-1)
You will get a monthly benefit for life. After you pass away, the same monthly benefit will be paid to your joint survivor beneficiary for his/her lifetime. Contact TRF if your joint survivor beneficiary is not a spouse; there are restrictions (age, child, etc.)
66-2/3 Percent Survivor Benefit (formerly B-2)
You get a monthly benefit for life. After you pass away, 66-2/3 percent of your benefit will be paid to your joint survivor beneficiary for his/her lifetime.
50 Percent Survivor Benefit (formerly B-3)
You receive a monthly benefit for life. After you pass away, one-half of your benefit will be paid to your joint survivor beneficiary for his/her lifetime.
Social Security Integration
If you retire between ages 50 and 62, you may combine the TRF monthly pension benefit with your estimated Social Security benefits. INPRS pays a larger monthly benefit before age 62. The payment may be greatly reduced or terminated at age 62. Your estimated monthly Social Security payment determines if your INPRS payment will be reduced or terminated. INPRS does not work in conjunction with Social Security. This option will not impact the benefit received from Social Security.
Minimum Amount Provision
The minimum amount provision makes sure you or your beneficiary will get a total pension benefit that is at least the balance of what you have in your ASA when you retire. If you die before then, your beneficiary will receive the balance of the amount due. Your beneficiary will receive this money as a lump sum or in monthly payments.
Example: You have $100,000 in your ASA when you retire. After 2 years, you have received $10,000 in monthly payments. If you pass away, your beneficiary will receive the remaining $90,000.