What is the Retirement Age in the State of Florida?
The Florida Retirement System (FRS) offers two different retirement options for employees who work for the state of Florida. You can choose the FRS Pension Plan, which will give you benefits on a monthly basis once you retire. Or, you can choose the FRS Investment Plan, which will allow you to choose how you want your money to be invested and how you will receive payments once you retire in Florida.
FRS Pension Plan
If you choose the state FRS Pension Plan Florida retirement option, you will receive monthly benefits based on several factors including the age at which you retire in Florida, your salary, your position, and how long you have worked for the FRS.
Plan members contribute 3 percent of their gross salary to the pension. You can start collecting your benefits when you retire if you are (1) vested, and (2) within twenty years plus or minus of your normal retirement age in the Florida Retirement System FRS.
If you leave the Florida Retirement System after you’ve been vested you will still get monthly benefits after you retire. If you leave the Florida Retirement System before you’ve been vested, you will not be eligible for monthly benefits in the state of Florida. However, you will be able to receive a refund of your contributions you’ve made into the Florida Retirement System thus far.
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Transferring Plans
If you choose to transfer from the Investment Plan to the Pension Plan, you will need to pay a certain amount from your account balance along with any additional amount necessary from your personal resources. You can count your Investment Plan service towards these vesting requirements if you transfer to the Pension Plan. If you are uncertain about how to transfer your retirement plan, or what your options are, you may want to reach out to a retirement management services agent to help you transfer your plan.
How Many Years Do You Have to Work for the State of Florida to be Vested?
The Florida Retirement System (FRS) is required to ensure there are sufficient funds available to you when your retirement benefits are due, thus bearing the market risk and the investment decisions. The FRS Pension Plan was established to serve long term service employees who spend most of their career with the FRS. Employees who prefer not to manage their own retirement plan and older employees may prefer the FRS Pension Plan. All employees of FRS are eligible for the Pension Plan except for Mandatory State University System Optional Retirement Program (SUSORP) members and Teachers’ Retirement System members.
Your benefits are back-loaded. This means you will accumulate your benefits more slowly at first, then begin to accumulate them at a quicker pace the longer you stay. In contrast, in the FRS Investment Plan, you will accumulate your benefits fairly evenly throughout your career with minor fluctuations in alignment with market fluctuations based on your investment strategy.
You are vested (eligible for retirement and FRS Pension Plan benefits) after you have completed six yrs of service is you were enrolled in FRS before July 1, 2011 and after eight yrs of service if you were enrolled in the FRS on or after July 1, 2011.
If your FRS employment was terminated before July 1, 2001, your vesting status will be based on your membership class. Senior Management Service Class members are vested upon completion of seven yrs of creditable service. Elected Officers’ Class members are vested upon completion of eight yrs of creditable service. Regular Class, Special Risk Class, Special Risk Administrative Support Class members are vested upon completion of ten yrs of creditable service.
How Many Years do you Have to Work for the State to Retire?
For retirees enrolled prior to July 1, 2011:
You must be at least 62 with six or more yrs of FRS service to qualify for retirement under normal retirement and receive your full monthly benefit if you were enrolled prior to July 1, 2011. Or, you can retire earlier if you have over 30 yrs of FRS service completed. If you are a Special Risk Class member, you can retire at 55 if you have at least six yrs of Special Risk service or have 25 yrs of Special Risk service, or at age 52 if you have 25 yrs of Special Risk service and military service.
If you are interested in early retirement, you will receive a reduced monthly benefit. For early retirement with the reduced monthly benefit, you are required to have six or more yrs of service, but you can retire at any age. Your reduction will be 5 percent for each year of your age that is younger than the normal retirement age (62 yrs old for Regular Class members).
For retirees enrolled on or after July 1, 2011:
You must be at least 65 yrs old with eight or more yrs of FRS service to qualify for retirement under normal retirement and receive your full monthly benefit if you were enrolled on or after July 1, 2011. Or, you can retire earlier if you have over 33 yrs of FRS service completed. If you are a Special Risk Class member, you can retire at 60 if you have at least eight yrs of Special Risk service, or have 30 yrs of Special Risk service, or at age 57 if you have 30 yrs of Special Risk service and military service.
If you choose to take early retirement, you will receive a reduced monthly benefit. For early retirement with the reduced monthly benefit, you are required to have eight or more yrs of service, but you can retire at any age. Your reduction will be 5 percent for each year of your age that is younger than the normal retirement age (65 yrs old for Regular Class members).
How is Florida Retirement Calculated?
Retirement in the state of Florida is calculated using the following formula:
Annual benefit = Number of Yrs of Service x Percentage Value x Average Final Compensation (1.6% for regular members). If we assume an average final compensation of $30,000 your annual benefit would equal $14,400. Ex. (30 yrs) x (1.6%) x ($30,000 AFC) = $14,400 per yr.
Conclusion
Choosing the right retirement plan can be overwhelming. Before making your choice between the FRS Investment Plan or the Pension Plan, you may want to discuss your options with an FRS management services agent to answer all your questions, explain your plan options, and help you make informed decisions regarding your retirement plans.
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