A member may retire early with a reduced retirement benefit after:
- Reaching age 60 (age 55 for firefighters and rescue squad workers) with at least five years of creditable service
- Reaching age 50 with at least 20 years of creditable service
Although a member may retire early, the retirement benefits will be paid over a longer period of time and are, therefore, reduced. The amount of the reduction depends on the member’s age and service when payments start.
A member who leaves employment before early or service retirement may receive a deferred benefit at a later date once the member has met all retirement eligibility requirements provided he or she does not withdraw his or her contributions.
For a member who is a general employee, the reduction in the allowance for early retirement is calculated as five percent times the lesser of:
- A member’s creditable service to 30 years
- A member’s age (up to age 60) plus three percent for each year from age 60 to age 65.
For example, a general employee who is 60 years old with 10 years of service would receive 85 percent of the unreduced benefit based on the reduction formula.
If a general employee is between ages 60 and 65, with fewer than 25 years of creditable service, his or her early retirement benefit will be reduced by the following:
| If the member is this age when payments start, | member will receive this percentage of their benefit. |
| 64 | 97% |
| 63 | 94% |
| 62 | 91% |
| 61 | 88% |
| 60 | 85% |
If a general employee is between ages 50 and 59, with fewer than 30 years of creditable service, his or her early retirement will be reduced to the following percentages in the table below.
If a firefighter or rescue squad worker is between age 55 and 60 with five to 20 years of creditable service, his or her early retirement will be reduced to the percentages shown below in the “20 years of creditable service” column.
| AGE | Years of Creditable Service | |||||||||
| 29 | 28 | 27 | 26 | 25 | 24 | 23 | 22 | 21 | 20 | |
| 59 | 95% | 90% | 85% | 80% | 80% | 80% | 80% | 80% | 80% | 80% |
| 58 | 95% | 90% | 85% | 80% | 75% | 75% | 75% | 75% | 75% | 75% |
| 57 | 95% | 90% | 85% | 80% | 75% | 70% | 70% | 70% | 70% | 70% |
| 56 | 95% | 90% | 85% | 80% | 75% | 70% | 65% | 65% | 65% | 65% |
| 55 | 95% | 90% | 85% | 80% | 75% | 70% | 65% | 60% | 60% | 60% |
| 54 | 95% | 90% | 85% | 80% | 75% | 70% | 65% | 60% | 55% | 55% |
| 53 | 95% | 90% | 85% | 80% | 75% | 70% | 65% | 60% | 55% | 52% |
| 52 | 95% | 90% | 85% | 80% | 75% | 70% | 65% | 60% | 55% | 50% |
| 51 | 95% | 90% | 85% | 80% | 75% | 70% | 65% | 60% | 55% | 50% |
| 50 | 95% | 90% | 85% | 80% | 75% | 70% | 65% | 60% | 55% | 50% |
If the member is between birthdays when payments start, the reduction will be adjusted proportionately.
In this example, a member retires early at age 61, with an average final compensation of $41,209 and 24 years of creditable service.
| Here is how we calculate this benefit |
| (AFC) $40,541 |
| x 0.185 |
| $750.00 |
| (creditable service) x 24 |
| $18,000.00 |
| Now, apply the early retirement reduction percentage |
| $18,000.00 |
| (percentage at age 61) x 0.88 |
| $15,840.00 |
The member in this example receives a maximum allowance of about $15,840 a year, or about $1,320 a month, which stops when the member dies unless he or she selected a survivor payment option.
This page was last modified on 11/20/2024