Employees of the Minnesota State colleges and universities system are enrolled in a mandatory retirement plan depending on the type of employment they perform.
Faculty, system administrators, and eligible unclassified members of the MAPE and MMA bargaining units must participate in either the defined benefit plan administered by the Teachers Retirement Association (TRA) or a defined contribution plan also known as the Minnesota State Individual Retirement Account Plan (IRAP).
Minnesota State employees in this group who have prior service in one of the state’s defined benefit plans are automatically enrolled in TRA. Otherwise, these employees can elect to participate in either the TRA plan or IRAP.
TRA overview
TRA is a traditional defined benefit pension plan that provides lifetime monthly retirement benefits. TRA also offers disability benefits for members who become totally and permanently disabled, and survivor benefits depending upon the annuity option selected at retirement.
TRA is funded through a combination of employer and employee paycheck contributions as well as investment earnings. Employees contribute 8.0% and employers contribute 9.81% of each paycheck issued to the employee. These dollars are then professionally managed by the Minnesota State Board of Investment.
TRA contribution amounts are set in Minnesota state law and are subject to change. Employee contributions are made on a pretax basis.
Electing TRA coverage
If you elect TRA coverage, your TRA pension benefit is calculated according to a formula that uses your years of service in TRA-covered employment, the average of your highest successive five years of salary, and your age at retirement. You will receive a TRA retirement benefit each month for as long as you live.
If you have service with more than one Minnesota public pension plan, you may be eligible for a combined service annuity at retirement. Among other things, a combined service annuity allows you to calculate the retirement benefit for all plans using the same highest five successive years of salary, no matter where it was earned. TRA can assist you in determining your eligibility and options.
IRAP overview
IRAP is a defined contribution plan, funded with employee and employer contributions and affected by investment gains or losses. If you elect IRAP, you make all the investment decisions, and the account is portable as you change employers or retire.
The value of your IRAP account is yours to use throughout retirement, or until the account is exhausted.
Important to know and do
If you have prior service credit with TRA or another Minnesota defined benefit plan when you are newly hired by Minnesota State, TRA is your default retirement plan.
- Notify your Minnesota State human resources representative when you are hired to ensure your retirement coverage defaults to TRA.
If you do not have prior service credit with TRA or another Minnesota defined benefit plan, IRAP is your default retirement plan. However, you have up to one year from your start date to choose TRA instead of IRAP.
- Contact your Minnesota State human resources representative for additional information and to elect TRA coverage in lieu of participating in IRAP.
If you achieve tenure or its equivalent and are an IRAP member, then you will have another opportunity to transfer your retirement coverage from IRAP to TRA.
- Minnesota State human resources will email information to you when you achieve tenure or its equivalent. Contact your Minnesota State human resources representative if you have questions about your eligibility.
- You will have one year after achieving tenure or its equivalent to elect to transfer your retirement coverage to TRA.
- You will be required to pay the full actuarial cost to purchase service credit in TRA for the entire period of time you were covered under IRAP.
Contact your Minnesota State human resources representative for additional information on mandatory and optional retirement plans available to Minnesota State employees.
