Benefit Options
You can choose from eight benefit options when you retire. The option you select will determine how your retirement benefit will be distributed to you and your beneficiaries, if you so choose.
Summary of Benefit Options
You can choose from eight benefit options when you retire. The option you select will determine how your retirement benefit will be distributed to you and your beneficiaries, if you so choose.
- The retirement option cannot be changed once the Affidavit of Retirement Option Election has been processed or the effective date of retirement or DROP participation has passed, whichever is later.
- Only Option 1 allows beneficiary changes.
- If a retiree dies within 30 days after retiring, then the retirement is null and void, and survivor benefits will apply.
- Read the Completing Your Affidavit of Retirement Option Election Checklist before completing your Estimated Affidavit for Retirement.
Summary of Benefit Options
| Member Benefit | Beneficiary Benefit | Conditions | |
|---|---|---|---|
| Maximum Option | Member receives largest possible monthly benefit | There is no beneficiary benefit | All benefits cease at death. Only the amount of member contributions that have not been paid out in monthly benefit or in DROP deposits and interest is due the member's estate. |
| Option 1 | Member receives a monthly benefit slightly less than Maximum Option, determined by the total amount of accumulated member contributions and member's age at time of retirement. | More than one beneficiary may be designated, and can be changed at any time by member/retiree. | Beneficiaries receive remaining balance of member's accumulated contributions in one lump-sum payment. (Option 1 may not be selected if member participates in ILSB.) |
| Lifetime benefit options: Under the following lifetime benefit options, only one beneficiary can be named, and that beneficiary may not be changed. The benefits are actuarially reduced from the Maximum Option benefit based on reduction factors determined by your age and the age of your beneficiary. Upon death of the member, the beneficiary receives a lifetime benefit. | |||
| Option 2 | Member receives a reduced monthly benefit. | Beneficiary receives same lifetime benefit member received. | |
| Option 2A (pop up) | Member receives a reduced monthly benefit. | Beneficiary receives same lifetime benefit member received. | If beneficiary dies before member, the reduced benefit "pops up" to Maximum Option. |
| Option 3 | Member receives a reduced monthly benefit greater than Option 2 or 2A benefit. | Beneficiary receives lifetime benefit equal to one half of benefit amount member received. | |
| Option 3A (pop up) | Member receives a reduced monthly benefit greater than Option 2 or 2A benefit but less than Option 3 benefit. | Beneficiary receives lifetime benefit equal to one half of benefit amount member received. | If beneficiary dies before member, the reduced benefit "pops up" to Maximum Option. |
| Option 4 | Member receives a reduced monthly benefit determined by the cost of the amount member designates for beneficiary. | Beneficiary receives lifetime benefit designated by member,not to exceed Option 2 benefit amount. | |
| Option 4A (pop up) | Member receives a reduced monthly benefit determined by cost of the amount member designates for beneficiary. | Beneficiary receives lifetime benefit designated by member,not to exceed Option 2 benefit amount. | If beneficiary dies before member, the reduced benefit "pops up" to Maximum Option. |