PEERS New Member FAQs

  1. What are the advantages of being a PEERS member?
  2. How much will my PEERS benefit be?
  3. What is included in my salary subject to PEERS contributions?
  4. When will I be eligible to retire with PEERS?
  5. How do I earn service toward my retirement?
  6. Am I required to be a member of PEERS?
  7. What is the difference between PEERS and PSRS?
  8. How is a defined benefit or pension plan like PEERS different than my 403(b), 401(k) or IRA?
  9. How much do I contribute to my PEERS retirement?
  10. How much does my employer contribute to my PEERS retirement?
  11. How do I find my total contributions and interest?
  12. What interest rate do I earn on my contributions?
  13. Can I borrow from my PEERS membership or take out my money?
  14. What if I permanently leave PEERS-covered employment before I can retire?
  15. What if I take a few years off to raise a family and return to PEERS-covered employment?
  16. What happens to my PEERS membership if I die before I retire?
  17. How do I change my beneficiaries for PEERS?
  18. Do I pay into Social Security and Medicare while working in PEERS-covered employment?
  19. Will I be eligible to receive both Social Security and PEERS benefits?
  20. If I am eligible for Social Security and Medicare benefits, at what age will they begin?
  21. What does it mean to reinstate or purchase service?

1. What are the advantages of being a PEERS member?
As a PEERS member, you enjoy knowing that once you have earned five years of service with PEERS, you are vested and can receive lifetime retirement benefits when eligible. In most cases, the retirement benefits paid to PEERS members greatly exceed the funds they contribute to the System while working.

Advantages to members:

  • Lifetime monthly retirement benefits
  • Your contributions and interest are always returned to you or your beneficiary(ies)
  • Vesting with five years of service
  • Disability benefits if you qualify
  • Various benefit plans allowing you to provide financial protection for your beneficiary(ies)
  • Cost-of-living adjustments on your retirement benefits

2. How much will my PEERS benefit be?
Your benefit amount is based on a formula that takes into consideration your years of service with PEERS, your Final Average Salary (FAS) and a benefit factor set by Missouri law. You can use our Benefit Estimate Calculator to estimate your benefit amount, or contact us.

  • Your Years of Service include all service earned for employment with PEERS-covered employers, as well as your reinstated or purchased service.
  • Final Average Salary (FAS) is determined by adding your three highest consecutive annual salaries (including employer-paid health, dental and insurance premiums) and dividing the total by 36.
  • The Benefit Factor is set by law and can only be changed by legislation. The factor used depends on the type of retirement benefits you are eligible for - normal, 25-and-Out or age-reduced benefits.

3.What is included in my salary subject to PEERS contributions?
Eligible salary reported to PEERS consists of all salary from PEERS-covered employers during the school year (July 1 - June 30), including extra duties, overloads and overtime. Also included is the amount your employer pays for your health, dental and vision insurance premiums. For example, your salary for the school year total $18,000. The health, dental and vision insurance premiums paid by your employer on your behalf are $2,000. Your total salary reported to PEERS is $20,000.


4. When will I be eligible to retire with PEERS?
Once you have earned five years of service with PEERS, you are vested and can receive lifetime retirement benefits when eligible.

You are eligible for normal retirement:

  • At age 60 with at least five years of service
  • At any age with at least 30 years of service
  • When the sum of your age plus your years of service equals 80 or more (Rule of 80)

Early retirement options are available, but benefit amounts under these options are reduced. You are eligible for early retirement:

  • At age 55 with at least five years of service
  • At any age with at least 25 years of service

If you are under the age of 62 at retirement and have at least 30 years of service or qualify for Rule of 80, an additional .8% temporary benefit is automatically added to your normal benefit until you reach minimum Social Security age, currently 62. At age 62, the temporary benefit stops, but the “normal benefit” portion of your benefit is permanent and continues for your lifetime.

If you retire prior to age 62, you can also choose to accelerate, or increase, your PEERS benefit until age 62, with an actuarial reduction applied to your benefit at age 62. Members who choose the Accelerated Payment Plan (APP) usually intend to apply for Social Security benefits at age 62, replacing the reduction in their PEERS benefit with income from Social Security. Choosing APP does not mean you will receive any extra income from PEERS over your lifetime. It simply means you will receive more of your benefit prior to age 62.

In addition, if you work three years beyond normal retirement, you may choose a one-time, Partial Lump Sum Option (PLSO) payment at retirement with reduced lifetime monthly benefits.


5. How do I earn service toward my retirement?
As you work in PEERS-covered employment, you earn service for each year, or partial year, you work. The formula used in your benefit calculation at retirement depends in part on your years of service at retirement. You can also purchase service.

Most members earn a year of service for each school year (July 1 - June 30) of PEERS-covered employment if they are a 9-, 10-, 11- or 12-month employee and serve the complete term required of the position. You may not earn more than 1.00000 year of service in any school year.

If you serve less than a full year, service is determined by dividing the salary earned during a school year by the annual base salary reported by your employer at the beginning of the school year. In other words, service is calculated on a salary over salary basis.

Example 1
Your full-time annual base salary is $18,000
You earn $18,000
$18,000 ÷ $18,000 = 1.00000
You receive 1.00000 year of service

Example 2
Your full-time annual base salary is $18,000
You earn $14,400
$14,400 ÷ $18,000 = 0.80000
You receive 0.80000 year of service


6. Am I required to be a member of PEERS?
Yes. PEERS membership is automatic, regardless of position, for non-certificated employees employed by the covered employers listed below to work at least 20 hours per week on a regular basis in a position that normally requires the employee to work at least 600 hours during the school term.

Covered employers include:

  • Public school districts in Missouri except the St. Louis (city) and the Kansas City public school districts
  • Public two-year colleges in Missouri except St. Louis Community College
  • Statewide non-profit educational associations that have elected to join PEERS

Note: Certificated employees who are employed less than full time but for at least 17 hours per week on a regular basis in a position that normally requires 600 hours during the school year are automatically Public School Retirement System of Missouri (PSRS) members, unless they choose to be a member of PEERS. This choice must be made within the first 90 days of the part-time employment as a certificated employee or teacher.


7. What is the difference between PEERS and PSRS?
Both PSRS and PEERS are Defined Benefit (DB) plans.

PSRS was established by the Missouri legislature in 1946 to provide certificated public school employees and their families with a significant and stable source of retirement income, disability and survivor benefits.

The Non-Teacher School Employee Retirement System of Missouri (NTRS), was created on October 13, 1965, with the adoption of House Bill 88. The goal was to build a plan similar to PSRS, but for non-certificated public school personnel. The name of the non-teacher system was changed to the Public Education Employee Retirement System of Missouri (PEERS) in August 2005 to more positively represent members.

  • PEERS members participate in the federal Social Security program, but most PSRS members do not.
  • PEERS members contribute at a lower rate to their retirement system than do PSRS members, and the benefit factors used in retirement benefit calculations are different.

8. How is a Defined Benefit or pension plan like PEERS different than my 403(b), 401(k) or IRA?

Because PEERS is a Defined Benefit, or DB, retirement plan, your benefits are calculated using a formula set by law and are guaranteed for your lifetime. The amount of your contributions and interest when you retire does not impact the amount of benefits you receive.

Unlike defined contribution, or DC, retirement plans such as 403(b), 401(k) or Individual Retirement Account (IRA) plans, you don't have to make investment decisions regarding your retirement funds. Investment decisions are handled by PEERS' professional investment staff and managers.

While DC retirement plans are an important piece of your overall retirement savings, they can be less effective because they provide benefits based on account balances in those plans at retirement. That means a retirement based on DC plan savings alone can run out and leave you without the retirement income you need.


9. How much do I contribute to my PEERS retirement?
While working, you contribute a percentage of your salary to PEERS to help fund your benefits. The contribution rate is set each school year by the PEERS/PEERS Board of Trustees, based on the recommendation of the Systems' actuary after the annual actuarial valuation is complete. Contributions are automatically deducted from your pay, before taxes.

For the 2016-2017 school year, the contribution rate is 6.86% of your salary.


10. How much does my employer contribute to my PEERS retirement?
Your employer contributes an amount equal to your contributions. All employer contributions are placed in a general reserve account used to help fund benefits for retirees and beneficiaries of deceased members.


11. How do I find my total contributions and interest?
Each fall, you receive a Member Statement. It includes the amount of your contributions and accumulated interest, as well as your years of service, salary history and beneficiary designation.

You can also create a username and password to access the secure portion of our website. There you can see the most current information about your membership, including your balance.


12. What interest rate do I earn on my contributions?
The interest rate is set each year by the PEERS/PEERS Board of Trustees and usually compares favorably with rates credited on most savings accounts. Interest is credited to your membership each year on June 30 and is calculated based on your previous June 30 balance. The interest rate applied on June 30, 2016 was 1%.


13. Can I borrow from my PEERS membership or take out my money?
The law does not permit partial refunds or loans from your PEERS membership. Therefore, you cannot take funds out of your PEERS membership while you are working in covered employment.

If your PEERS-covered employment ends, you have the right to take a refund of your contributions and interest in a lump-sum payment, in which case you forfeit your service and any rights to future benefits.


14. What if I permanently leave PEERS-covered employment before I can retire?
If your PEERS-covered employment ends, you have the right to take a refund of your contributions and interest in a lump-sum payment, in which case you forfeit your service and any rights to future benefits.

If you have fewer than five years of service (not vested), you can leave your funds with PEERS for the next five school years and receive interest. If you return to PEERS-covered employment within the five-year period, you will continue with the same membership. If you do not earn any retirement service within the five-year period, your membership terminates and your contributions no longer accrue interest.

If you have five or more years of service (vested), you may leave your funds and they will continue to accrue interest. You may apply for lifetime monthly benefits when you reach retirement eligibility.


15. What if I take a few years off to raise a family and return to PEERS-covered employment?
If your PEERS-covered employment ends, you have the right to take a refund of your contributions and interest. However, if you plan to return to covered employment, it may be advantageous to leave your funds with PEERS.

If you leave covered employment with fewer than five years of service (not vested), you can leave your funds with PEERS for the next five school years and receive interest. If you return to PEERS-covered employment within the five-year period, you will continue with the same membership. If you do not earn any retirement service within the five-year period, your membership terminates and your contributions no longer accrue interest.

If you return to PEERS-covered employment after your membership has terminated, you can take a refund of your contributions and interest from your terminated membership, or you can roll your funds from that membership into your new one.

If you leave covered employment with five or more years of service (vested), you can leave your funds and they will continue to accrue interest. You may apply for lifetime monthly benefits when you reach retirement eligibility.

Any time you return to PEERS-covered employment after taking a refund, you can buy back, or reinstate, all or any portion of the service to your new PEERS membership.


16. What happens to my PEERS membership if I die before I retire?
Your beneficiary may be entitled to one of two types of survivor benefits:

  1. A one-time, lump-sum refund of your contributions and interest
  2. Lifetime monthly retirement-based benefits

It is important to keep your beneficiary designations up-to-date so benefits may be paid according to your wishes if you die before retirement.

Any time you have a change in life status (marriage, divorce, birth or adoption of a child), you must file a new beneficiary form. If you do not, your beneficiaries will be determined by Missouri law.


17. How do I change my beneficiaries for PEERS?
You can change your PEERS beneficiary designation any time before retirement. During the first 18 months of your membership, you can designate and change your beneficiaries by logging in to Web Member Services. For your security, after that time, you must make changes using a Pre-Retirement Beneficiary Designation form.


18. Do I pay into Social Security and Medicare while working in PEERS-covered employment?
Yes. PEERS members also participate in the federal Social Security and Medicare programs. Social Security taxes are currently 6.2% of your earnings, and Medicare taxes are currently 1.45% of your earnings.


19. Will I be eligible to receive both Social Security and PEERS benefits?
With few exceptions, PEERS members with sufficient Social Security-covered employment should be eligible to receive full benefits from Social Security and Medicare. In limited cases, your Social Security benefit could be affected by other income sources defined by Social Security, such as railroad pensions or pensions from non-Social Security-covered employment (like PSRS). We recommend that you contact your local Social Security office, the Social Security Administration at (800) 772-1213, or visit www.socialsecurity.gov for more information.


20. If I am eligible for Social Security and Medicare benefits, at what age will they begin?
Reduced Social Security benefits are available at age 62; full benefits begin based on the year of your birth and are not available before age 65. Medicare benefits begin at age 65 for most individuals.


21. What does it mean to reinstate or purchase service?
One of the many advantages of PEERS membership is the ability to increase your benefit amount or become eligible for retirement earlier by purchasing, reinstating or transferring additional service to your PEERS membership.

If you have previous PEERS service you forfeited by taking a refund, you can buy back, or reinstate, all or any portion of the service. In most cases, you will receive information regarding any service you are eligible to reinstate at the time you establish your PEERS membership. This will include a cost estimate.

In addition to reinstating previously forfeited PEERS service, there are other types of service you may be eligible to purchase. If you were on military, sick or maternity leave, or had a break in your PEERS-covered employment when you worked elsewhere, you may be eligible to purchase service for that time. You can also purchase service for employment prior to becoming a PEERS member. In limited cases, members may be able to transfer or recognize service earned with other Missouri public retirement systems.