Average Final Compensation (AFC): The highest average annual compensation received based on contributions paid, for any four consecutive years of contributable service.
Years of Creditable Service (YCS): The amount of time a regular employee is a member of the retirement system and makes contributions to the system and prorated for partial years worked.
Your retirement benefit is the product of the Average Final Compensation, times the Years of Creditable Service, times the Multiplier specific to your plan (see Types of Benefits) subject to the minimum and maximum limits. Dividing the annual retirement benefit by 12 gives you the monthly benefit amount.
Plan B: (Members retiring on of after June 30, 1999 and hired prior to January 1, 2014)
AFC x 2% x YCS = MONTHLY PENSION
Plan C: (Members hired on or after January 1, 2014)
AFC x 1.75% x YCS = MONTHLY PENSION
EXAMPLE: Pat Smith, hired prior to January 1, 2014, retires from the School District on June 1, 2016 after working 15.5 years. Pat’s highest average annual compensation for four consecutive years is $22,500. If he were 60 years old the calculation of Pat’s monthly benefit would be:
$22,500 x .02 x 15.5 = $581.25 monthly benefit
Members who retire with at least 10 years of creditable service are entitled to a basic benefit as follows:
10 to 20 Years Creditable Service–$150 plus an additional $15 per month for each full year of creditable service over 10.
20 Years Creditable Service–$300 monthly basic benefit.
For most retirees the maximum retirement benefit is 60% of Average Final Compensation. Therefore even If you have more than 30 years of contributable service your benefit will not exceed 60% of your AFC.
The early retirement benefit calculation reduces the monthly pension by an actaurially determined rate based on the number of months prior to normal retirement age a member elects to receive a benefit.
(EXAMPLE: If Pat Smith is 57 years and 7 months old when he decides to retire. His pension of $581.25 is reduced to $464.77 because he is taking an early retirement benefit.
($581.25 x .79961 = $464.77)