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Ready To Retire
What you Need to Know
How to File
Members should contact BERS six months before the desired date of retirement to schedule an appointment. Upon the date of the scheduled appointment Members must provide proof of date of birth for themselves. If a member is choosing a beneficiary option for the pension, they must also provide proof of date of birth for the beneficiary.
The Calculation
If you have at least 5 years of credited service (and are, hence, vested), you have made all required membership contributions, and you have reached the required age, then you are eligible to receive Service Retirement Benefits. To calculate how much your benefit will be, a percentage of your Final Average Salary is multiplied by the number of years of credited service you have accrued.
Your Final Average Salary (FAS) is the average of the annual wages - including overtime pay - you earned during any continuous period of employment for which you were credited with five years of credited service. Of the annual wages used in this calculation, no year's wages can exceed 110% of the average of the previous four years.
Member Vesting and Health Benefits Eligibility
On April 9, 2022, Chapter 56 of the Laws of 2022 amended the Retirement and Social Security Law (RSSL) to lower the minimum number of years required for members to vest for service retirement from 10 years to 5 years of credited service. However, Chapter 56 did not affect retiree eligibility for City health benefits. Below is a summary of the requirements for a retiree to enroll in City health benefits:
- You have at least ten (10) years of credited service as a member of a retirement system maintained by the City or the Department of Education (if you were an employee of the City on or before December 27, 2001, then you must have at least five (5) years of credited service as a member of a retirement system maintained by the City);
OR - You have at least fifteen (15) years of credited service as a member of either the Teachers' Retirement System or the Board of Education Retirement System if you were an employee of the City or the Department of Education appointed on or after April 28, 2010, and held a position represented by the recognized teacher organization on the last day of paid service. Where this paragraph and paragraph (1) both apply, this paragraph controls.
AND - During the minimum period of credited service required for eligibility under paragraph (1) or (2) above, or at the time of separation from employment with the City or the Department of Education, you were working regularly for twenty (20) or more hours a week and eligible for City health benefits as an employee of the City or the Department of Education.
AND - You receive a pension check from a retirement system maintained by the City or the Department of Education. These requirements are defined in Section 12-126 of the NYC Administrative Code. For more information regarding retiree health benefits, please visit the Office of Labor Relations website, or refer to the New York City Health Benefits Summary Program Description.
Plan Ahead
Preparing for Retirement
If you are planning to retire within the next three years, it is not too early to start taking steps to make the retirement process an easy one. Knowing what to do and when to do it will make the retirement process less stressful for you.
You should schedule a consultation with a BERS benefit examiner to discuss your desired retirement date. During your consultation you should discuss prior service and any outstanding loan you may have. Your benefit examiner will provide you with an approximation of your retirement benefit. You should also inquire about choosing a beneficiary option. Once you've decided on a retirement date, you should inform your employer and/or timekeeper. Ask how this date relates to your accrued vacation and terminal leave balance. You cannot remain on active payroll after your retirement date, so if you plan to stay on payroll to use your time accruals, your retirement date must be set after the day your accruals are exhausted.
You should make a final appointment and complete your retirement application at most three months in advance of your desired retirement date. Tier 1 and Tier 2 members must submit their completed applications at least 30 days prior to their retirement date, and Tier 4 and Tier 6 members must submit their completed application at least one day prior to their retirement date.
You will need to bring proper identification such as a driver's license or passport, as well as birth certificates for you and your beneficiaries. If you want your benefits directly deposited into your bank account, you and your bank must complete an Electronic Fund Transfer Authorization Form and return it to BERS.
Tax Deferred Annuity
At retirement, you have a few options for what to do with your TDA account. You may (a) elect to defer your TDA at retirement, which allows you to leave your TDA contributions and earnings in your account until Required Minimum Distributions begin; (b) arrange to receive regular payments through the purchase of an annuity, (c) make a direct withdrawal of your entire TDA balance, or (d) roll your entire TDA balance over to an IRA or other retirement plan. If you defer your TDA at retirement, you may request a full or partial refund at any time. Retired participants may elect to receive their TDA payments in the form of a fixed or variable annuity, which provides monthly payments in addition to your pension.
Outstanding Loans
If you have an outstanding pension loan when you file for retirement, you will have two choices on how to fulfill the required repayment: 1. You can make a lump sum payment in the full amount of the outstanding loan balance (a.k.a. liquidate the loan) or 2. You can elect to have the outstanding loan balance deducted from your ASF or MCAF account, which represents your accumulated contributions. If you choose to have the balance deducted from your ASF or MCAF account, you will have no out-of-pocket expense; however, the amount of your pension benefit will be reduced. The reduction to your pension benefit is a permanent reduction and continues for as long as you receive pension payments. If you have an outstanding pension loan and choose to retire without paying this loan off, the balance of the loan will be considered a distribution, and you will receive a 1099R for the taxable portion of the distribution. This amount will also be reported as income to the Internal Revenue Service. You may have to pay income tax on the distribution amount. To make a lump sum payment to pay off the loan, you can let your BERS Benefit Examiner know during your retirement appointment, or you can contact BERS to request a lump sum payment amount and the payment due date.
If you have an outstanding TDA loan at retirement, and you elect to withdraw or to annuitize your TDA, your outstanding TDA loan balance will be considered a distribution for tax purposes. BERS will issue a 1099R for the taxable amount of the distribution. If you choose to elect TDA Deferral status, you will have the option to either continue making payments for your outstanding loan balance or to distribute the remaining outstanding balance. If you are interested in completing the repayments, make sure to let your BERS Benefit Examiner know while you are filing for retirement. A request for direct payment coupons must be made to BERS within 60 days of leaving service.
How to Contact BERS
Get in touch with BERS. Details are here.
Helpful Resources
How to Make a Final Retirement Appointment with BERS