How to Acquire Years of Service Credits in the California Teachers’ Retirement System

How to Purchase Years of Service in the California Teachers Retirement System (CalPERS)

The California Teachers Retirement System (CalPERS) is a public pension fund that provides retirement and related benefits to California’s public school teachers, faculty, and other employees. One of the ways to enhance your retirement benefits is by purchasing additional years of service. This article will guide you through the process of purchasing years of service in the CalPERS.

Understanding the Benefits

Before diving into the process, it’s essential to understand the benefits of purchasing years of service. By adding additional years to your service record, you can increase your final retirement benefit calculations. This can result in a higher monthly pension payment, giving you more financial security in your retirement years.

Eligibility Requirements

To purchase years of service in CalPERS, you must meet certain eligibility requirements. First, you must be a CalPERS member in good standing. Additionally, you must have at least one year of creditable service in the system. If you’re a non-member, you may still be eligible to purchase service if you were covered under a different retirement system.

Types of Service Credit

CalPERS offers different types of service credit that you can purchase. These include:

1. Prior Service Credit: This credit allows you to purchase service credit for time you worked before becoming a CalPERS member.
2. Service Purchase: You can purchase service credit for time you worked for another employer that was covered by a different retirement system.
3. Air Time: This credit is available for certain military service and allows you to purchase up to five years of service credit.

Calculating the Cost

The cost of purchasing years of service in CalPERS varies depending on several factors, including the type of service credit, your age, and the salary you were earning during the period you’re purchasing. You can calculate the cost by contacting CalPERS directly or using their online benefit estimator.

Submitting the Application

Once you’ve determined the cost and type of service credit you want to purchase, you’ll need to submit an application to CalPERS. You can do this by visiting their website, calling their customer service, or visiting a local CalPERS office. Be prepared to provide necessary documentation, such as proof of employment and salary information.

Finalizing the Purchase

After CalPERS reviews your application and documentation, they will notify you of the approval or denial. If approved, you’ll need to pay the required amount within a specified timeframe. Once the payment is processed, the additional years of service will be added to your record, and you’ll begin receiving the enhanced retirement benefits.

Conclusion

Purchasing years of service in the California Teachers Retirement System can be a valuable way to increase your retirement benefits. By understanding the eligibility requirements, types of service credit, and the application process, you can make informed decisions to secure a more comfortable retirement. For more information or assistance, contact CalPERS directly.