TEACHERS & SCHOOL EMPLOYEES · PENSION / 403(B) / 457(B)

Your pension formula is only half the plan. Portability and the supplemental account decide how much flexibility you have.

A career teacher, a teacher changing states, and a teacher inside a high-fee 403(b) need different moves. The plan tier, service record, Social Security record, and vendor menu control the answer.

Major law changeWEP and GPO were repealed. For Social Security benefits payable January 2024 and later, a non-covered public pension no longer triggers those reductions—but covered earnings are still required to qualify for Social Security.

CHOOSE THE REAL CAREER PATH

The job decision comes before the retirement-account decision.

The same pension formula can be valuable for a career employee and nearly irrelevant for someone leaving before vesting. Model the career path you are actually likely to live.

STAYING IN ONE SYSTEM

Retirement dates matter more than one balance.

Calculate the pension at the earliest eligible date, the target date, and one year later. Confirm how final-average salary, service credit, early-retirement factors, and retiree health change.

REQUEST THREE WRITTEN ESTIMATES—NOT ONE.

CHANGING DISTRICTS OR STATES

Do not cash out before pricing the deferred benefit.

Vesting, reciprocity, service transfer, refunds, and purchased credit vary by system. A refund can surrender future pension rights that are expensive or impossible to restore.

COMPARE LEAVE, TRANSFER, PURCHASE, AND REFUND IN WRITING.

SUPPLEMENTAL SAVING

The product inside the 403(b) or 457 matters.

A 403(b) may hold an annuity contract or mutual-fund custodial account. A governmental 457(b) can have different separation access. Compare every approved provider, fee, surrender charge, and fund lineup.

THE ACCOUNT LABEL DOES NOT TELL YOU THE COST.

PENSION FORMULA BUILDER

Reproduce the gross pension before debating whether it is enough.

Use the exact final-average salary definition, multiplier, service credit, and reduction from the plan. Then compare the result with the official estimate.

Final-average annual salaryCreditable service yearsPlan multiplierEarly or survivor reduction

This formula model does not establish eligibility or include a COLA, contribution refund, taxes, retiree health, purchased service, Social Security, or plan-specific caps. Reconcile it to a written pension estimate.

GROSS PENSION FORMULA—

THE TEACHER-SPECIFIC TRAPS

Old Social Security advice and expensive vendor contracts can both distort the plan.

The pension is only useful when the law is current and every supplemental account has a defined job.

SOCIAL SECURITY

WEP and GPO advice written before 2025 is obsolete.

The Social Security Fairness Act ended both provisions for benefits payable after December 2023. That does not create missing work credits; download the current earnings record and claiming estimates.

403(B) CONTRACT

A 403(b) is not automatically good or bad.

The specific provider, expense ratio, annuity cost, surrender schedule, crediting method, and investment menu determine quality. Compare approved options before stopping or transferring anything.

GOVERNMENTAL 457(B)

The 457 can be a separate flexibility tool.

An eligible governmental 457(b) generally avoids the 10% additional early-distribution tax after separation, although rolled-in qualified-plan money can retain different treatment. Confirm the plan document.

SERVICE PURCHASE

More service credit is not automatically a bargain.

Compare purchase cost with the incremental annual pension, simple and discounted break-even, survivor continuation, COLA treatment, and the liquidity given up to fund it.

TEACHER RETIREMENT FILE

Turn the district benefits packet into six verified decisions.

Do not leave with a pile of pension vocabulary. Leave with the exact tier, three estimates, and a clean supplemental-account inventory.

Confirm the pension system, plan tier, hire date, vesting rule, and retirement-eligibility formula.

Reconcile every year of service and every salary period used in final-average compensation.

Request official estimates at the earliest eligible date, the target date, and one year later.

Document deferred-benefit, refund, reciprocity, and service-purchase rules before changing systems.

Download the Social Security earnings record and remove any WEP or GPO assumption from old projections.

List each 403(b) and 457 provider, all-in cost, surrender charge, fund menu, beneficiary, and purpose.

OFFICIAL RULES

Use the source that controls this benefit.

The calculator is a screening tool. The current plan document, administrator record, and written benefit estimate control eligibility and payment. Verify the edition and effective date before an irreversible election.

RUN THE NEXT NUMBER

Use the calculator that matches this retirement system.

PENSION ELECTION