Vesting and Interest
You are not required to take an account refund just because you are no longer working in PSRS-covered employment. But there are differences in how long you may leave your funds with PSRS based on whether or not you are vested.
If you are not vested, you may leave your funds with PSRS for the next five years and continue to receive interest on your funds. If you do not return to covered employment during those five years, your account automatically terminates and you no longer receive interest. At that time, you will be contacted with the information you need to request a refund.
If you are vested (have at least five years of credit with PSRS), you may leave your funds with PSRS indefinitely. Your funds accrue interest every June 30 based on the interest rate set by the PSRS/PEERS Board of Trustees and your account balance as of the previous June 30. You are entitled to receive lifetime monthly retirement benefits when you become eligible. Options may also be available for qualified family members to receive benefits in the event of your death.
It is always important to carefully consider the pros and cons of taking an account refund. Remember, when you receive a refund, you forfeit all of your PSRS credit and benefits. If you are vested, it may be to your financial advantage to leave your funds with PSRS and collect retirement benefits when you become eligible.