Teacher Retirement System | TCTA
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Teacher Retirement System

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The Teacher Retirement System of Texas manages pension funds for Texas public education and some higher education employees, and it oversees the health insurance programs for active members (TRS-ActiveCare) and retirees (TRS-Care). TRS is governed by a nine-member board of trustees, appointed by the governor and confirmed by the Texas Senate.

Many changes to TRS and its benefit structure have occurred in recent legislative sessions. These changes have made determining an individual employee's retirement eilgibility and benefits very complicated. We encourage TCTA members to call or email TCTA with general questions, or contact TRS directly for information about a specific situation.

Per 2019 legislation, contribution rates to the TRS pension fund will increase over the next five years.

Contributions to the Pension Fund (a percentage of salary)

2020 2021 2022 2023 2024
State 7.5% 7.75% 8.0% 8.25% 8.25%
Active members 7.7% 8.0% 8.0% 8.25% 8.25%
School districts* 1.6% 1.7% 1.8% 1.9% 2.0%

*Districts also contribute at the state rate on salary paid above the state required minimum salary.

Employees contribute 0.65% of salary to the TRS-Care fund (retiree health insurance). The state contributes 1.25% of payroll, and school districts contribute 0.75%.

Standard retirement

Generally, a TRS member may retire with the standard benefit at:

  1. age 65 with five or more years of service credit; or
  2. with at least five years of service, any combination of age and years of service credit totaling at least 80 (the “Rule of 80”).

Exceptions:

  • A member who enters TRS membership after Aug. 31, 2007, and who had at least five years of service credit as of Aug. 31, 2014, must also meet a minimum age of 60 for full retirement benefits.
  • A member who did not have at least five years of service credit as of Aug. 31, 2014, must meet a minimum age of 62 for full retirement benefits.

Members described by these provisions can still retire upon meeting the Rule of 80, but will have benefits reduced by 5% for each year under age 60 or 62, as appropriate.

A TRS member who entered the system prior to Aug. 31, 2007, and had at least five years of service credit as of Aug. 31, 2014, does not have to meet a minimum age requirement to retire with full benefits.

Provisions regarding “entering the system” consider a person who withdrew TRS funds, then subsequently returned to school employment, to have entered on the date of re-entry rather than the original date of membership. The TRS Benefits Handbook has full details on retirement eligibility.

Same-sex spouses

Pursuant to the U.S. Supreme Court’s ruling in Obergefell v. Hodges in June 2015, TRS extends spousal benefits to same-sex spouses.

Early retirement

An employee can opt for early retirement if he/she has at least 30 years of service credit but does not meet the Rule of 80, or is at least age 55 with five or more years of service.

Penalties for early retirement can be quite severe, but depend on the employee’s age, years of service credit, and whether they meet certain “grandfather” provisions established in 2005 when the penalties for early retirement were increased. Employees considering early retirement can consult with a TRS benefits counselor or use the retirement calculators on the TRS website.

If a member leaves TRS-covered employment before meeting the criteria for retirement with either full or reduced benefits, the member may withdraw the money contributed to date, plus interest earned, but will not receive an annuity. The interest earned on contributions was lowered from 5% to 2%; the lower rate applies to contributions made after Sept. 1, 2014.

Note: Any employee retiring after Aug. 31, 2005, who does not meet the Rule of 80 or have at least 30 years of service credit will not be eligible for TRS-Care, the retiree health insurance.

Disability retirement

An employee with a mental or physical disability that is likely permanent and that prohibits further performance of his/her duty may be eligible for disability retirement. An individual who qualifies for disability retirement and who has at least 10 years of service credit may opt for a disability retirement and receive an unreduced monthly annuity (calculated using the standard retirement formula), with a minimum annuity of $150. An employee who qualifies for disability retirement but has fewer than 10 years of service credit will receive a monthly benefit of $150 paid for the number of months that the employee worked in a TRS-covered position prior to retirement, the duration of the disability, or the duration of the employee’s life, whichever is least.

Other key provisions affect how disability retirement works and whether it is the best option for an employee with a disability; members should review the TRS Benefits Handbook or speak to a TRS benefits counselor for more details.

Partial lump-sum option

Retirees can select a partial lump-sum distribution of cash in exchange for a lower future monthly retirement benefit. This program is available only to members who are eligible for unreduced retirement benefits. The member must meet a Rule of 90 upon retirement to be eligible for the PLSO.* The maximum lump sum that may be taken is an amount equal to 36 months of a member’s monthly retirement benefit. For more information and to calculate the reduced standard monthly benefit under the PLSO, click here.

*An employee who, as a TRS member on Aug. 31, 2005, was at least age 50, or met the Rule of 70 (age and years of service credit total at least 70), or had at least 25 years of service credit does not have to meet the Rule of 90 upon retirement to be eligible for the PLSO, but must meet the requirement for normal (unreduced) retirement.

Retire/rehire

NOTE: significant changes were made to the employment after retirement laws during the 2021 legislative session; those changes will be reflected in the updated Survival Guide available in Fall 2021. In the meantime, check TCTA's bill summaries under the category of "Teacher Retirement System" for information, and call TRS at 800-223-8778 to talk to a benefits counselor.

A retiree can return to work full time after a complete break in TRS-covered employment (substitute service counts as “employment” for this purpose as do some types of volunteer work) of at least 12 consecutive months. The employee can then return to work in school employment without any loss of monthly TRS checks. An employee working at a school in any capacity, paid or unpaid, during the 12 months after retirement should contact TRS regarding their eligibility to return to work. A retiree can return to work part time or as a substitute after only a one-calendar-month break in service without penalty (a disability retiree returning part time or as a substitute may work no more than 90 days in the school year).

An employee who retired prior to Jan. 1, 2011, can return to work full time with no loss of monthly TRS checks, even if the employee did not sit out 12 months before returning to work.

Districts must make contributions to TRS (15.2% of salary) and TRS-Care (an amount set by TRS at $535 per month, due only on retirees participating in TRS-Care) on behalf of a rehired retiree. Pursuant to legislation initiated by TCTA, this surcharge is not required for employees who retired prior to Sept. 1, 2005.

State law does not prohibit districts from reducing a retiree’s salary to help offset the cost of the surcharge, though local policies may differ in this regard. However, districts cannot pay less than the amount to which the employee would be entitled under the state minimum salary schedule.

A district participating in TRS-ActiveCare may be required to offer ActiveCare enrollment to a returning retiree, but the retiree may opt to remain in TRS-Care.

How to calculate your TRS benefits

To calculate TRS retirement benefits, use the following formula:

  1. Multiply your years of service credit by 2.3%. (Example: if you have 30 years of service credit in TRS, 30 x 2.3 = 69%.)
  2. Determine the average of your five highest years of salary.*
  3. Multiply your average salary (from step 2) by the number from step 1. This is your annual TRS standard annuity. (Example: $50,000 x 69%. This person’s standard annuity would be $34,500 per year.)

*An individual who, as a TRS member on Aug. 31, 2005, was at least 50 years old, or met the Rule of 70, or had at least 25 years of service credit should use the three highest years of salary for this calculation.

Note the exceptions listed here that describe reductions in the standard annuity based on standard age at retirement.

If you have questions about your TRS benefits, call 1-800-223-8778 or visit the TRS website.

TRS service credit

Partial Year of Service

An employee who is not retiring must work at least 90 days during the school year to receive a year of service credit. An exception is made for individuals in their final year before retirement; they can receive the year of credit for working the full fall semester, even if it is less than 90 days. The “school year” for TRS purposes begins Sept. 1, so the 90-day count does not include any days worked prior to Sept. 1.

Purchase of credit

Teachers can purchase different types of service credit in the retirement system, including:

  1. Previously withdrawn credit from prior service in Texas
  2. Out-of-state service (up to 15 years)
  3. Military service (up to five years)
  4. Credit for accumulated state leave (one year of credit for 50 unused state leave days)
  5. Developmental leave (up to two years)
  6. Work experience (for career/technology teachers only; up to two years)

There are limits on the aggregate amount of time purchased, and the cost of different types of service credit varies among individuals (TRS can provide assistance in calculating the cost). Purchased service credit counts toward the requirement to meet the Rule of 80 for TRS-Care eligibility.

A person with unreported service (including substitute service) must verify the service within five years of when it was rendered for it to be creditable.

If your TRS annual statement excludes any eligible service or compensation credit, you must correct the error no later than May 31 of the year following the year in which the service was rendered in order to avoid paying an additional cost. After that time (but within the five-year period) you will pay the actuarial cost of the service, which will increase every year ­— so take care of the issue as quickly as possible.