Information for Early Career Members
We recognize that retirement may not be uppermost in your mind at this stage in your career. But at PSRS, we believe that planning in advance is essential to achieve a financially secure and enjoyable retirement.
We encourage you to understand the advantages of your membership and the benefits you are entitled to receive.
What Every Early Career Member Should Know
How Retirement Benefits are Funded
PSRS' funding comes from three sources: member contributions, employer contributions and investment earnings. Investment earnings are the primary source of funding for PSRS benefits. On average, 62 cents of every dollar paid to PSRS/PEERS retirees comes from investment earnings.
Missouri law requires the System to maintain a funding level that covers current and anticipated future benefit promises. This guarantees availability of funds to pay benefits as prescribed by law.
PSRS contributions are automatically deducted from your pay, pre-tax, to help fund your benefits. For 2016-2017, the contribution rate is 14.5% of your salary. Your employer contributes an equal amount. Employer contributions are paid into a general fund used to pay benefits for retirees and beneficiaries.
The contribution rate is set each school year by the PSRS/PEERS Board of Trustees. It is based on the recommendation of the Systems' actuary after the annual actuarial valuation has been completed.
As a member, you have this guarantee: your contributions and the accrued interest are always returned to you or your beneficiary in the form of monthly benefits or a lump-sum payment.
The PSRS Advantage
PSRS is a Defined Benefit (DB) pension plan, providing predictable retirement income for life, no matter how long you live. In most cases, the retirement benefits paid to PSRS members greatly exceed the funds they contribute while working.
Your lifetime retirement benefits are determined by a pre-defined formula that includes:
- A benefit factor set by the Missouri Legislature
- Your salary (including employer-paid health, dental and vision insurance premiums)
- Your years of service with PSRS at retirement
You are vested in PSRS with five years of eligible service. Once vested, you can receive lifetime retirement benefits when you reach age and service requirements. Vesting may also help you qualify for disability benefits and survivor benefits for your beneficiaries.
Financial Protection for Loved Ones
In addition to the emotional stress caused by the loss of a loved one, it can also put significant stress on a family's finances, particularly when this occurs during the working years. To help ease this burden, PSRS offers valuable financial protection for your family if you die before retirement or while receiving PSRS disability retirement benefits.
The benefits payable depend on your beneficiary designation, your employment status and years of service with PSRS.
Always keep your beneficiary designations with PSRS up-to-date to ensure benefits payable to your survivors are distributed according to your wishes. As an active PSRS member, you can update your beneficiary designation at any time using the Pre-Retirement Beneficiary Designation form. View the brochure, Protecting Those You Care About, or contact us for more information.
Three types of benefits are provided for beneficiaries of members who die before retirement:
- One-time, lump-sum refund of contributions and interest
- Lifetime monthly retirement-based benefits
- Monthly dependent-based benefits
Specific qualifications must be met in order to receive lifetime monthly retirement-based benefits.
If you develop an illness or sustain an injury that prevents you from working in any occupation, you may be eligible for PSRS disability benefits. The cause of your disability does not have to be work-related.
- Have at least five years of PSRS-covered employment
- Under age 60
- Become permanently disabled while working in PSRS-covered employment, or within one year after, if the condition causing the disability begins while you are employed
- Incapable of earning a livelihood in any occupation
Temporary or partial disability benefits are not available under the retirement law. Inability to earn a livelihood in any occupation is a prerequisite for approval of a Disability Retirement Application. PSRS currently defines a "livelihood" as earning $18,000 per year.
If you think you may qualify, or have questions regarding disability retirement, please contact us.
If you qualify for PSRS disability retirement, until you reach age 60, you will receive monthly PSRS disability benefits to help you and your family, as long as you are unable to earn a livelihood in any occupation and do not return to work for a PSRS-covered employer in any capacity. Upon reaching age 60, your benefits are payable regardless of your disability status, unless you return to full-time PSRS-covered employment or exceed the limits on the hours and salary you can work at covered employers on a part-time basis or as a temporary-substitute while receiving disability benefits.
Applying for Disability Benefits
All forms listed below must be completed and returned to PSRS.