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PERA is currently revising Web pages and publications to reflect changes as a result of the enactment of Senate Bill 10-001;
please review the Senate Bill 10-001 Web page for detailed information.

Calculating a Retirement Benefit Under the DPS Benefit Structure

Your DPS benefit is based on your years of service credit and your age at retirement. It is calculated using a percentage of your Highest Average Salary (HAS).

HAS under the DPS benefit structure is the average monthly salary of the 36 months of earned service having the highest salaries.

Any money placed in a Section 125 flexible spending account is not considered salary. So, if you contribute to a Section 125 plan to reduce your salary during one or more of the periods used in the HAS calculation, your HAS will be reduced. Subsequently, the amount of your PERA benefit will be lower. For more information, refer to the PERA & Section 125 Plans brochure.

If you receive a cash payment based on unused annual leave, vacation time, or personal leave at termination of employment, it will be included as salary with member and employer contributions reported on it. Note: If you use the Highest Average Salary Calculator to estimate your HAS and you receive this type of cash payment, your HAS will be inflated. For service credit, such a payment will be projected forward at your regular monthly rate of pay. See Colorado PERA's Accrued Leave Policy fact sheet for more information.

DPS has two Highest Average Salary Percentages tables based on the date you were hired. See the HAS Percentages Tables page for more information.

Calculating Your Benefit

Example of Options A, P2, and P3 Benefits

The example below uses a retiring member with 25 years of service credit at age 60 and who began employment prior to July 1, 2005. The cobeneficiary is age 57.

1. Calculate HAS

2. Calculate Option A. Multiply the HAS in number 1 above by the benefit percentage on the DPS Highest Average Salary Percentages table. See the HAS Percentages Tables page. Note: Years of service in the Highest Average Salary Percentages table show full years only; you receive credit for each month that you work.

Retiree

$2,778 X 62.5% =

$1,736*

*Up to the maximum allowed by law, see Federal Limits on Benefits below.

3. Calculate Option P2. Multiply the Option A amount by the percentage from the Current Option Percentages table Option P2 below. (The cobeneficiary receives half the benefit amount the retiree received before death.)

Retiree	$1,736 X .913% =	$1,585
Cobeneficiary	$1,585 ÷ 2 =	$793

Current Option Percentages Effective January 1, 2010
(Rounded to 3 decimals; actual factors are 6 decimals)
Tables are revised periodically to account for changes in life expectancies and other factors

Option P2	Cobeneficiary's Age
Retiree's Age	48	50	53	55	57	59	61	63
50	.946	.951	.957	.961	.965	.968	.971	.974
55	.919	.925	.933	.938	.944	.949	.953	.958
60	.882	.888	.899	.906	.913	.919	.926	.932
65	.833	.840	.853	.861	.870	.878	.887	.896

4. Calculate Option P3. Multiply the Option A amount by the percentage from the Current Option Percentages table Option P3 below. (The cobeneficiary receives the same amount the retiree received before death.)

Retiree	$1,736 X .840%=	$1,458
Cobeneficiary		$1,458

Current Option Percentages Effective January 1, 2010
(Rounded to 3 decimals; actual factors are 6 decimals)
Tables are revised periodically to account for changes in life expectancies and other factors

Option P3	Cobeneficiary's Age
Retiree's Age	48	50	53	55	57	59	61	63
50	.899	.906	.918	.925	.932	.938	.944	.950
55	.851	.860	.875	.884	.894	.903	.911	.919
60	.789	.800	.817	.828	.840	.851	.863	.874
65	.714	.726	.744	.757	.771	.784	.798	.812

Example of Option B Benefit

An Option B benefit annuitizes a retiring member's account balance at time of retirement to determine the monthly benefit amount and the number of monthly benefit payments.

Member contribution account balance:	$55,000
Number of guaranteed monthly payments:	110 months
Monthly benefit amount:	$1,500
Number of Option B beneficiary(ies):	1

Example: Retiree begins receiving a monthly benefit and dies after 60 months. The Option B beneficiary then begins receiving the same monthly benefit amount. After receiving 20 months of monthly benefits, the Option B beneficiary dies and the remaining amount is then paid to the estate in a lump-sum amount equal to the value of the remaining 30 benefit payments. There are no further payments on the account.

Conversion of Leave

Unused annual leave, vacation time, or personal leave converted to a cash payment at termination of employment is includable as salary with member and employer contributions reported on it. Generally, this payment is made in a lump sum to you in your last month of pay. (A cash payment based on unused sick leave is not includable as salary.)

Because the cash payment is not compensation for services rendered in the last month of employment, PERA projects this payment out into future months using your monthly rate of pay. For example, a cash payment of $3,400 is made to you in January (the terminating month) and your monthly rate of pay is $2,500; $2,500 of the payment would be projected into February and the remaining $900 would be projected into March. You would earn two more months of service credit and, for most retiring members, the HAS would increase slightly.

Federal Limits on Benefits

If you are under the DPS benefit structure, choose Option P3, and name someone other than your spouse who is more than 10 years younger than you as your cobeneficiary, the amount that continues to you cobeneficiary at your death could be limited in accordance with percentages required by the Internal Revenue Code regulations.

Benefits paid under the DPS benefit structure are subject to a federal annual limit on the amount of retirement benefits that PERA retirees may receive under Internal Revenue Code (IRC) Section 415.

For more information on how this limit may affect your future DPS retirement benefit, see the Federal Limits on Benefits page.

PERA has developed a process called a Replacement Benefit Arrangement that provides for your employer to pay you the amount you are not being paid by PERA because of the federal tax limit. This is done at little or no cost to the employer.

For more information on PERA retirement benefits view, print or order the PERA Retirement Process booklet.

Click to view

	HAS Percentages Tables
	PERA's Benefit Calculators

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