TRS outlines Tier 1 retirement calculations, service credit rules and planning steps

A TRS staff member presented a step-by-step explanation of Tier 1 retirement benefits for members who began public service in Illinois before Jan. 1, 2011, explaining eligibility, the benefit formula and planning tools.

The presentation emphasized that TRS is a defined-benefit plan: members contribute a fixed 9% of gross earnings that is pooled in the TRS trust fund and used to pay lifetime pensions. The staff member summarized the calculation used by TRS: total years of service credit multiplied by a formula factor (generally 2.2%) produces a percentage of the member’s final average salary, which becomes the annual pension amount.

Service credit rules were a central focus. A year of service equals 170 paid days; partial years are prorated. Members may convert unused, uncompensated sick leave into service credit at retirement (up to 340 days total, which converts to a maximum of two years of service credit). Optional purchases of service can include out-of-state or out-of-system teaching (up to 10 years), up to three years of board-approved leave-of-absence credit (including involuntary layoff), up to two years of active-duty military credit (if prior to TRS service), repayment of a prior TRS refund to reinstate service, and up to two years of Illinois private-school credit (which must be verified…