The CalSTRS retirement plan is mandatory for public school teachers. A portion of a teacher’s gross salary is paid into CalSTRS on a monthly basis, which essentially reduces the teacher’s immediate taxable income. CalSTRS then invests these contributions into the Teacher’s Retirement Funds. Incidentally, CalSTRS pays no taxes on the income it receives from these invests because it is a Defined Benefit Pension Plan. That means the plan promises to pay a specified amount to each person retiring after a set number of service years. In addition to a member’s own contributions, the employer and the State also contribute to the system on the member’s behalf.

There are retirement benefit options that an employee can choose from:

• Member Only
• 100% Beneficiary Option
• 75% Beneficiary Option
• 50% Beneficiary Option
• Compound Option

To be eligible for the CalPERS School Member benefit retirement formula, you must be employed in a classified position within the jurisdiction of a school employer. Service retirement is a lifetime benefit that is derived from the benefit formula. You may apply for a service retirement when you have five years of CalPERS service and meet the age requirement. If you were hired prior to January 1, 2013 you must be age 50. If you were hired on or after January 1, 2013, you must be at least age 52.

There are retirement benefit options that an employee can choose from:

• Unmodified Allowance
• Return of Remaining Contributions Option 1
• 100% Beneficiary Option 2
• 100% Beneficiary Option 2 with Benefit Allowance Increase
• 50% Beneficiary Option 3
• 50% Beneficiary Option with Benefit Allowance Increase
• Flexible Beneficiary Option 4

Let TDS help you in determining what your pension will look like at the time of your retirement.