You are eligible to receive a monthly retirement benefit when you meet your applicable age and service requirements, which depend upon when you started working with a PERA employer. Detailed requirements are provided in the Colorado PERA Retirement Eligibility fact sheet.
If you have less than five years of service credit under the Denver Public Schools (DPS) benefit structure, you do not have the option to apply for a monthly benefit. Instead, you are only eligible to do a rollover/refund of your DPS Defined Benefit (DB) Plan account.
You may estimate your retirement benefit at any time by using the Colorado PERA Monthly Retirement Benefit calculator. If you log in to your account with your User ID and password, your information will automatically be entered in the calculator. You may also request a benefit estimate by calling PERA’s Customer Service Center.
Your PERA retirement 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). If you want to learn about how your benefit will be calculated, including how your HAS will be determined, refer to the Retirement Process booklet.
As a PERA retiree, you will receive a lifetime monthly benefit payment. You can also choose a benefit option that will continue to pay a person of your choice following your death. The person receiving the continuing benefit is called your cobeneficiary. In selecting your benefit option, you should consider your age, financial obligations, health, income from other sources, and needs of your spouse or other persons. To learn about your options, refer to the Retirement Process booklet.
Factors That May Affect Your Benefit Amount
Some PERA employers have required their employees to take furlough days (days off without pay). The reduction in your salary for these days off may lower the HAS used to calculate your retirement benefit.
In some cases you may opt to make contributions on the amount that your salary was reduced. See the Colorado PERA and Furlough Days From July 1, 2002, through June 30, 2004, fact sheet.
However, please note that state law does not allow make-up contributions for furlough days after June 30, 2004, see the Colorado PERA and Furlough Days After June 30, 2004, fact sheet.
Section 125 Plans
Other than contributions to a Health Savings Account (HSA), any money placed in a Section 125 flexible spending account is not considered salary for PERA purposes. So, if you contribute to a Section 125 plan 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.
Conversion of Leave
Unused annual leave, vacation time, or personal leave converted to a cash payment at termination of PERA-covered employment is includable as PERA salary and will have member and employer contributions reported on it. Generally, this payment is made in a lump sum to you in your last month of pay. (However, note that a cash payment of unused sick leave is not includable as PERA salary, and will not have contributions reported on it. Cash payout of unused sick leave will not be included in your HAS.)
Because the cash payment of unused annual leave, vacation time, or personal leave is not compensation for services rendered in the last month of employment, PERA projects those payments out into future months using your monthly rate of pay. For most retiring members, this may result in a slightly higher HAS and additional service credit.
Federal Limits on Benefits
Federal law places limits on the annual amount of retirement benefits that PERA retirees may receive under Internal Revenue Code (IRC) Section 415(b).
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.
For more information, see the Internal Revenue Code 415(b) Limits fact sheet or call PERA's Customer Service Center.
Benefits and Domestic Relations Orders
If a you have a valid domestic relations order (DRO) on your DB plan account, part of the monthly benefit will be paid to you and part will be paid to the alternate payee (your ex-spouse) as specified in the DRO.
PERA Funds and Legal Process
PERA retirement benefits can only be subject to legal process for federal and Colorado state tax liens, assignments for child support purposes, garnishments for child support arrearages or child support debt, and valid domestic relations orders. PERA retirement benefits are also subject to attachment for restitution for theft, embezzlement, misappropriation, or wrongful conversion of public property. Attachment is also allowed in the event of a judgment for a willful and intentional violation of fiduciary duties where the offender or a related party received direct financial gain. PERA benefits are not otherwise subject to execution, levy, attachment, garnishment, or bankruptcy proceedings and cannot be assigned voluntarily or involuntarily.