Purchasing Service Credit - Effect on Benefit (Part 1)

(Click "Load Data," which will enter your personal account information if you have a PERA PIN/User ID and Password. Please note-the results displayed are based on the unaudited information reported to Colorado PERA by your employer. Records will be audited prior to a formal calculation by Colorado PERA when you apply for a purchase, benefit, or a refund/rollover. If you do not have a PERA PIN/User ID and Password, you may find it helpful to refer to your latest PERA Annual Member Statement for some of the requested information.)

Use this calculator to estimate the effect that purchasing service credit has on your monthly retirement benefit. In order to determine the effect of the purchase, you must first calculate your retirement benefit below. After you have entered all the required data and selected "Calculate" below, select the link that appears in the results at the right to test additional purchases.

For information on how your retirement benefit is calculated and your options when retiring, view the Retirement Benefits page. If you would like information on withdrawing your account, see the Terminating PERA-Covered Employment page. If you are interested in having a benefit estimate calculated for you, contact PERA's Customer Service Center at 1-800-759-7372.

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(Only include purchases that you have already completed. Additional purchases you are planning to make will be entered in part 2 of this calculator.)

Contribution Information (Optional)

If you want to calculate your rollover/refund amount or your money purchase benefit, enter your Contribution Information.

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If you want to calculate your lump-sum withdrawal (refund) amount or your money purchase benefit, enter your Contribution Information.


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Cobeneficiary Information (Optional)

If you are planning to provide a lifetime monthly benefit to a cobeneficiary after your death, enter the information below for Option 2 and 3 calculations under the PERA benefit structure or Option P2 and P3 calculations under the DPS benefit structure.

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If you are planning to provide a lifetime monthly benefit to a cobeneficiary after your death, enter the information below for Option 2 and 3 calculations under the PERA benefit structure or Option P2 and P3 calculations under the DPS benefit structure.

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Benefit Options

When you apply for a monthly retirement benefit, you will choose Option 1, 2, or 3 in the PERA benefit structure or Option A, B, P2, or P3 in the DPS benefit structure for payment of your benefit. If you do not choose an option, your benefit will be paid as an Option 1 or Option A benefit. If you choose Option 2/3 or P2/P3, you will select one cobeneficiary who will receive a continuing monthly benefit after you die.

Option 1 or A

This option provides you with a lifetime monthly benefit. Following your death, a single payment of any remaining balance in your DB Plan account (plus a 100 percent match on the balance in the PERA benefit structure), will be made to your named beneficiary, or your estate if no named beneficiary exists. No further monthly benefits are payable.

Option B (DPS only)

This option provides you with a lifetime monthly benefit. As part of the retirement calculation, your DB Plan account is annuitized to determine the guarantee payment period. If you die before the end of the guarantee period, your Option B beneficiary(ies) will receive your remaining monthly payments through the end of the guarantee period. If your Option B beneficiary(ies) receives a benefit after your death and dies before the end of the guarantee period, a single payment will be paid to the estate of the deceased beneficiary. If your Option B beneficiary(ies) predeceases you, you do not name any additional Option B beneficiary(ies), and you die before the end of the guarantee period, a single payment will be made to your estate. No further monthly benefits are payable.

Option 2 or P2

This option provides you with a lifetime monthly benefit. Following your death, your cobeneficiary will receive a lifetime monthly benefit equal to one-half of your benefit at the time of your death. If there is a DB Plan account balance remaining after the death of your cobeneficiary, a single payment of any remaining balance in your DB Plan account (plus a 100 percent match on the balance in the PERA benefit structure), will be made to your named beneficiary, or your cobeneficiary's estate if no named beneficiary exists. No further monthly benefits are payable.

Option 3 or P3

This option provides a lifetime monthly benefit. Following your death, your cobeneficiary will receive a lifetime monthly benefit equal to the monthly benefit you were receiving at the time of your death. If there is a DB Plan account balance remaining after the death of your cobeneficiary, a single payment of any remaining balance in your DB Plan account (plus a 100 percent match on the balance in the PERA benefit structure), will be made to your named beneficiary, or your cobeneficiary's estate if no named beneficiary exists. No further monthly benefits are payable. Note: If you are in the DPS benefit structure and select Option P3 and name someone other than your spouse (through marriage) who is more than 10 years younger than you as your cobeneficiary, the amount that continues to your cobeneficiary at your death could be limited in accordance with percentages required by the Internal Revenue Code (IRC) regulations.

For more detailed information on these Options and how they are calculated, see the Your PERA Benefits booklet, or contact PERA Customer Service at 1-800-759-7372.

Definitions for Calculating a Benefit

Highest Average Salary (HAS)

If you are a member in the PERA benefit structure or in the DPS benefit structure, but were not eligible to retire on January 1, 2011, HAS is one-twelfth of the average of the highest annual salaries on which contributions were paid that are associated with three periods of 12 consecutive months of service credit. An annual limit of 8 percent or 15 percent applies to the salary increases. You can click the "Help me calculate my HAS" link to calculate this value.

If you are a member in the DPS benefit structure and were eligible to retire on January 1, 2011, HAS is the average monthly salary of the 36 months of earned service having the highest salaries.

Years of Earned and Purchased Service Credit

Enter your total earned and purchased service credit years as of your retirement date. If you click "Load Data," the first date you are eligible for an unreduced service retirement will appear. If you are currently an active contributing member of PERA, the calculation will assume that you will continue working and earning service credit until your retirement date. (You may adjust your information to calculate different retirement scenarios; however, fields will not automatically change and you will need to enter your information for each field.) If you are a member in the DPS benefit structure, do not include any Outside Service. Use a decimal for partial years. For example, if you have 15 years and 6 months of total service credit, enter 15.5. (Divide the number of months by 12 to get your decimal.)

Years of Outside Service (DPS benefit structure)

If you are a member of the DPS benefit structure, you may have received service credit earned from a qualified plan outside of the DPS retirement system (Outside Service). This value will not affect your benefit, but can affect your eligibility for retirement. Use a decimal for partial years. For example, if you have 3 years and 6 months of Outside Service, enter 3.5. (Divide the number of months by 12 to get your decimal.)

Contribution Information

If you choose to withdraw your account(s), you will receive your contributions, any payments you made to purchase service credit, and interest earned. You may be eligible to receive a match. If you do not withdraw your account, your money purchase benefit is calculated using your life expectancy and your total account balance at retirement, plus an eligible match. Any payments you made to purchase service credit are not matched.

Minimum Age/Service Requirements:

Highest Average Salary Calculation

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