NEARING RETIREMENT

What you need to know now

If you’re over 55, it’s time to get real about retirement planning. Attend a TRA group workshop or individual retirement counseling session and we’ll review your personalized benefit estimate with you, guide you through TRA’s benefit plans, and help you reach your retirement goals.

The pre-tirement years
RETIREMENT ELIGIBILITY

If you are age 55 or older and vested in our retirement system, you are eligible to apply for a retirement benefit—but benefits may be reduced for those retiring early (before “normal retirement age” as defined by TRA). Normal retirement age for TRA members first hired prior to July 1, 1989, is age 65 with less than 30 years of allowable service, and age 62 with 30 years or more of allowable service. For TRA members first hired July 1, 1989, or after, the TRA normal retirement age is 66.

PREPARATION TIMETABLE 

Age 55 (approximately 10 years from retirement): Familiarize yourself with your retirement benefits by reading about TRA’s annuity plans and watching our videoChoosing a Plan That is Right for You. Generate estimates of your retirement benefits by logging in to your MyTRA account and using the online calculator. Register for a TRA group workshop.

Age 60 (approximately six years from retirement): Familiarize yourself with decisions you must make before retiring by watching the videos, Completing Your Retirement Application and by attending a group presentation on Planning for Retirement. Generate estimates of your retirement benefits by logging in to your MyTRA account and using the online calculator. Attend a TRA workshop or make an appointment with a TRA counselor.

Age 65 (approximately one to two years from retirement): Schedule an appointment with a TRA counselor for a one-on-one discussion of your options.

Social Security Normal Retirement Age

(by year of birth)

1943-1954: 66

1955: 66 and 2 months

1956: 66 and 4 months

1957: 66 and 6 months

1958: 66 and 8 months

1959: 66 and 10 months

1960 and later: 67 years

WHEN TO APPLY FOR YOUR TRA PENSION

The 2018 pension law allows retirement applications to be accepted up to 180 days (six months) before termination of teaching service. If you are currently teaching or on a leave of absence and eligible for benefits, you can apply up to 180 days before your termination date. Read about last day of employment.

If you are teaching and have a target date in mind—the date you reach age 55, Rule of 90, or age 62 with 30 years of service—you may use that date on TRA’s retirement date designation form. Otherwise, your benefit will be effective the day after your termination date. Your effective date of retirement might be impacted if you return to work and have not submitted your application to TRA.

If you have not taught in the last six months, your benefit effective date will be the date we receive the application.

  • You are not considered to have terminated employment if, before age 62, and before the effective date of retirement, you have entered into a contract to resume teaching service with a TRA-eligible employer.
  • If you are age 62 or older, you are allowed to begin receiving a retirement annuity from TRA even if you have entered into an agreement to return to teaching service. This agreement must be mutually agreed upon by you and your employer and include your termination and reemployment dates. A copy of the agreement must be filed with your TRA application for retirement prior to your accrual date.

If you are currently teaching, your effective date of retirement will be the day following the latest of:

  • the date teaching service terminates or termination of service if on a leave of absence,
  • the date that your resignation letter is submitted to your employer,
  • termination of your contract by employer action,
  • the date your application for retirement is received by TRA,
  • June 30 for school principals and other administrators who receive a full contract salary for performance of a full year’s contract duties, or
  • another date within the six-month period following your termination date, when you reach Rule of 90, or age 55.

If you are currently with another Minnesota public retirement system, your accrual date will be the day following the termination of that service, as long as you apply within six months.

IF YOU ARE CURRENTLY ELIGIBLE FOR RETIREMENT
  • If you do not file for retirement benefits from TRA, and return to work, your benefit accrual date may change. Your new accrual date will be based on your new last day of teaching. This means that you could lose a month or more of benefits because you worked possibly just a few days.
  • If you do not apply for retirement within six months of your termination date, your accrual date will be based on the date you file your application for retirement. Once again, you could lose six or more months of retirement benefits.
  • If you resign from teaching with no intention of returning to a teaching position, in some cases, it may be beneficial for you to receive benefits immediately rather than waiting until a specific age. This all depends on when you resign, the length of time you would be receiving benefits and your life expectancy.
if you are DEFERRING RETIREMENT 

If you are vested and terminate service with a TRA-covered employer before attaining the minimum retirement age of 55, you may defer payment of your annuity until you become age 55 or older. Effective July 1, 2019, interest on deferred-member contributions will be reduced to zero percent. If you once were employed in a TRA position but have not yet applied for a benefit or a refund of contributions, contact TRA.

The deferral period must be at least three months. If you are on a leave of absence, you are not eligible for interest on a deferred annuity for any portion of time that you are on leave.

Returning to work as a sub could also have an adverse effect on your high-five average salary if you terminate employment mid-year and go from a full-time contract salary to the lower sub rate of pay. It would lower the full-time equivalent for that year, causing it to drop out of the high-five calculation. Your high-five average salary is always the highest five consecutive years or enough consecutive partial years to equal five.

Since there are so many factors that may affect when you retire, you may wish to discuss your options with a TRA representative. You can also log on to your TRA online account and produce estimates of retirement benefits using various retirement ages, dates, years of service, and high-five average salary assumptions. These estimates may give you a clearer picture of when it is best for you to retire.

All about early retirement

You might be considering retiring early. If you do, your benefit must be reduced because you will be receiving it for a longer period of time.

“Early retirement” is any age earlier than 66, and the younger you retire before age 66, the higher the reduction—similar to Social Security.

Learn more about early retirement

To-do list for those nearing retirement

  • Keep working toward being debt-free going into retirement—you’re going to be living on a fixed income.
  • Determine eligibility. If you’re at least 55 and vested, you are eligible to apply for a retirement benefit, though it pays to wait until age 66.
  • Contact the Social Security Administration to determine your options.
  • Generate TRA retirement benefit estimates on our website.
  • Find a financial planner to discuss how best to turn your savings—your TRA pension, 403(b), IRA, Social Security, etc.—into income during retirement without getting hit with a big tax bill.
  • Contact any other Minnesota public retirement funds to which you have made contributions.
  • Make an appointment with a TRA retirement counselor. You will get a personalized, detailed estimate of your projected monthly retirement benefit. The application process and key decisions are also explained.
  • Contact your employer to determine requirements for submitting your resignation notice. Resignation should be effective on the last day of work.
  • Review health insurance options (through school district or supplemental insurance providers).
  • Submit retirement application.

Register for a MyTRA account!

Access your personal information, run benefit estimates, make appointments, and more.

If you are an employer contact and do not yet have an employer login, call TRA employer assistance 1-800-657-3853.

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