EARLY RETIREMENT DECISION

 

When you choose to retire early, another set of rules comes into place based on your Tier and whether you satisfy the "Rule of 80".

The Rule of 80 is your age at retirement + your service credit (the years you have worked in the TRS system). Enter your information below to see if you satisfy the Rule of 80.

Did you satisfy the Rule of 80?

Congratulations. You’re living the good life.

If you are Tier 1 or 2, your benefits are awesome! You get to enjoy an extra 10 years of retirement!

If you are Tiers 3, 4, 5, or 6: not so fast. Your benefits get reduced 5% for every year you take them before age 60 or 62. Why? Back when they were trying to decide how to cut taxes and not provide the awesome benefits they’d given for the last 60 years, a deal was cut. Teachers who’d worked a long time in the system had their benefits preserved, while newer teachers had their benefits cut. But they said that would be ok because new teachers would have time to get used to the system.

Did teachers get hosed? Yes. Do you need to plan around it? Yes.

Highcharts Example
If you are planning on retiring early without meeting the Rule of 80, you need to be aware that your pension can be severely reduced depending how how far away you are from satisfying the Rule of 80. We created this chart to illustrate what your reduction will be depending on how many years of service you have and how old you will be when you retire.

Highcharts Example

There is an exception to this rule. Whatever tier you are in, if you have 5 years of service and you are 65 or older, you will receive your full pension. If you are under 65 at the time of retirement then the Rule of 80 applies and early retirement will potentially lower your pension amount. But practically speaking, at age 65 the Rule of 80 no longer matters.