Calculating a reduced pension for early retirement

Let’s say Lindsay wants to retire at age 58, but her earliest unreduced retirement date based on her 20 years of eligibility service is age 60. Since Lindsay wants to retire two years before age 60, her pension will be reduced by the following:

  • For service up to June 30, 2015: Reduced by 6% (3% for each year she retires before age 60)
  • For service after June 30, 2015: Reduced by 12% (6% for each year she retires before age 60)

Component 1 – for service up to June 30, 2015

Component 2 – for service after June 30, 2015

$17,972 x (100% - 6%)

$6,619 x (100% - 12%)

 

Lindsay’s reduced pension: $22,718 per year, or $1,893 per month

Because Lindsay is retiring before the age of 65, she will also receive a bridge benefit payable until her 65th birthday. However, as she has not reached her earliest unreduced retirement date, her bridge benefit will also be reduced:

$5,368 x (100%-6%)

 

Lindsay’s bridge benefit: $5,046 per year or $420 per month.

 

Let us do the math for you!

It’s easy to get a personalized estimate of how much your pension could be! Simply log in to MySTF and go to the Pension Estimator.

Pension Estimator