As a school employee who first became an active member of PSERS on or after July 1, 2019, you are automatically enrolled as a Class T-G member. Class T-G provides both a Defined Benefit (DB) and a Defined Contribution (DC) component for your retirement benefit. If you wish to remain in Class T-G, no action is required. You have a 90-day election period to decide if you would like to remain Class T-G or elect one of two other membership classes: Class T-H or Class DC.
This guide compares the features and benefits of each membership class on the next page. Class T-G is the default Membership Class in which you contribute the most to your DB component of your retirement benefit and offers the highest monthly DB benefit at retirement. Class T-G also has the highest Employer DC Contribution Rate of the three Classes.
No action is required to remain in Class T-G. Remember, your decision to remain Class T-G or elect Class T-H or Class DC is irrevocable.
| Your Default Option Class T-G (Hybrid of DB & DC Plans) | Elective Option Class T-H (Hybrid of DB & DC Plans) | Elective Option Class DC (DC Plan) | |
|---|---|---|---|
| Total Member Contribution Rate | 8.25% (DB: 5.50% + DC: 2.75%) | 7.50% (DB: 4.50% + DC: 3.00%) | 7.50% |
| Employer Contribution Rate to Member's DC Account | 2.25% | 2.00% | 2.00% |
| Vesting Period (When you qualify for a benefit) | 10 years (or age 67 with 3 years of service) - DB Plan 3 eligibility points - DC Employer Contributions/Earnings | No DB Plan 3 eligibility points - DC Employer Contributions/Earnings | |
| Total Retirement Benefit | DB = 1.25% x FAS x Years of Service + Value in DC account at the time of retirement | DB = 1.00% x FAS x Years of Service + Value in DC account at the time of retirement | No DB Plan. Value in DC account at the time of retirement |
| Your Total Retirement is based on... | Guaranteed monthly benefit (DB Plan) + Contributions (DC Plan) and the investment performance | Contributions (DC Plan) and the investment performance | |
| Purchasing Service, Disability Retirement, Electing Multiple Service | Yes | No, except for USERRA | |
| Normal Retirement Age | For the DB Plan, earlier of:
| For the DB Plan, age 67 with 3 years of service For the DC Plan, distribution upon termination of service | N/A (Distribution upon termination of service) |
| Early Retirement Milestone | Age 57 with 25 years of service | Age 55 with 25 years of service | N/A |
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Membership Class Snapshot:
Class T-G offers the highest monthly DB benefit at retirement. You also have a DC component of your retirement, which is based on what you and your employer contribute to the DC Plan and the performance of those contributions based on the investment options you choose, subject to costs and expenses. Compared to Class T-H, Class T-G has a higher DB member contribution rate* and a higher employer DC contribution rate, but a lower participant DC contribution rate.
Class T-H offers a monthly benefit from the DB component that is lower than Class T-G. You also have a DC component of your retirement, which is based on what you and your employer contribute to the DC Plan and the performance of those contributions based on the investment options you choose, subject to costs and expenses. Compared to Class T-G, Class T-H has a lower DB member contribution rate* and a lower employer DC contribution rate, but a higher participant DC contribution rate.
Class DC offers the value of your DC account based solely on what you and your employer contribute to the DC Plan and the performance of those contributions based on the investment options you choose, subject to costs and expenses. The participant DC contribution rate is the highest and the employer DC contribution rate is the same as Class T-H, which is lower than that of Class T-G. Class DC provides no monthly DB benefit or PSERS disability retirement benefit. Class DC members cannot purchase service and cannot elect Multiple Service membership to combine PSERS credited service with service credited in the State Employees’ Retirement System.
* The DB contribution rate is subject to a Shared Risk/Shared Gain contribution rate. Please the Contributions page for the most current contribution rates.
Determining the Right Membership Class for You
To assist you in deciding which membership class is right for you, use this calculator and class election inserts to see what the different benefit amounts may be when you plan on retiring. You just need to enter your age, starting annual salary, and the number of years you plan on working.
Class Election Examples
DB Plan assumptions: Final average salary of $64,433 and earns a guaranteed 4% on contributions and interest. Member leaves these in for maximum pension benefit. The base DB contribution rate is 5.50% for Class T-G and 4.50% for Class T-H. Shared Risk/Shared Gain rate is not applied.
Visit psers.pa.gov for the most current contribution rates.
DC Plan assumptions*: 26 pay periods per year and 6% rate of return.
| Your Default Option | Your Other Elective Options | ||
|---|---|---|---|
| Class T-G Highest guaranteed retirement benefit | Class T-H Reduced guaranteed retirement benefit | Class DC Value of account at time of distribution | |
| Total Retirement Benefit | $590,258 | $515,244 | $408,861 |
| Retirement Benefit Breakdown | $28,190 Annual Pension for life + DC Plan Account of $215,190 at retirement | $22,552 Annual Pension for life + DC Plan Account of $215,190 at retirement | No Annual Pension (You assume all investment risk) + DC Plan Account of $408,861 at retirement |
| First Year Member Contribution | $2,062.60 or $79.33 from biweekly pay | $1,875 or $72.11 from bi-weekly pay | |
| Total Member Contributions | $124,703 | $113,366 | |
| Total Employer DC Contributions | $34,010 | $30,231 | |
DB Plan assumptions: Earns a guaranteed 4% on contributions and interest. Member is non-vested and must withdraw contributions and interest. The base DB contribution rate is 5.50% for Class T-G and 4.50% for Class T-H. Shared Risk/Shared Gain rate is not applied. Visit psers.pa.gov for the most current contribution rates. You are eligible for a refund of your DB contributions and interest if you terminate employment before becoming vested.
DC Plan assumptions*: 26 pay periods per year and 6% rate of return.
| Your Default Option | Your Other Elective Options | ||
|---|---|---|---|
| Class T-G Highest guaranteed retirement benefit | Class T-H Reduced guaranteed retirement benefit | Class DC Value of account at time of distribution | |
| Total Retirement Benefit | $29,003 | $26356 | $27,447 |
| Retirement Benefit Breakdown | $0 Annual Pension for life + DC Plan Account of $14,446 at retirement | $0 Annual Pension for life + DC Plan Account of $14,446 at retirement | No Annual Pension (You assume all investment risk) + DC Plan Account of $27,447 at retirement |
| First Year Member Contribution | $2,062.60 or $79.33 from biweekly pay | $1,875 or $72.11 from bi-weekly pay | |
| Total Member Contributions | $18,240 | $16,673 | |
| Total Employer DC Contributions | $5,002 | $4,446 | |
DB Plan assumptions: Final average salary of $103,093 and earns a guaranteed 4% on contributions and interest. Member leaves these in for maximum pension benefit. The base DB contribution rate is 5.50% for Class T-G and 4.50% for Class T-H. Shared Risk/Shared Gain rate is not applied. Visit psers.pa.gov for the most current contribution rates.
DC Plan assumptions*: 26 pay periods per year and 6% rate of return.
| Your Default Option | Your Other Elective Options | ||
|---|---|---|---|
| Class T-G Highest guaranteed retirement benefit | Class T-H Reduced guaranteed retirement benefit | Class DC Value of account at time of distribution | |
| Total Retirement Benefit | $944,399 | $824,388 | $654,177 |
| Retirement Benefit Breakdown | $45,103 Annual Pension for life + DC Plan Account of $344,304 at retirement | $36,083 Annual Pension for life + DC Plan Account of $344,304 at retirement | No Annual Pension (You assume all investment risk) + DC Plan Account of $654,177 at retirement |
| First Year Member Contribution | $3,300 or $126.92 from biweekly pay | $3,000 or $115.38 from bi-weekly pay | |
| Total Member Contributions | $199,525 | $181,386 | |
| Total Employer DC Contributions | $54,416 | $48,370 | |
DB Plan assumptions: Final average salary of $64,433 and earns a guaranteed 4% on contributions and interest. Member is non-vested and must withdraw contributions and interest. The base DB contribution rate is 5.50% for Class T-G and 4.50% for Class T-H. Shared Risk/Shared Gain rate is not applied. Visit psers.pa.gov for the most current contribution rates. You are eligible for a refund of your DB contributions and interest if you terminate employment before becoming vested.
DC Plan assumptions*: 26 pay periods per year and 6% rate of return.
| Your Default Option | Your Other Elective Options | ||
|---|---|---|---|
| Class T-G Highest guaranteed retirement benefit | Class T-H Reduced guaranteed retirement benefit | Class DC Value of account at time of distribution | |
| Total Retirement Benefit | $46,405 | $42,170 | $43,916 |
| Retirement Benefit Breakdown | $0 Annual Pension for life + DC Plan Account of $23,114 at retirement | $0 Annual Pension for life + DC Plan Account of $23,114 at retirement | No Annual Pension (You assume all investment risk) + DC Plan Account of $43,916 at retirement |
| First Year Member Contribution | $3300 or $126.92 from biweekly pay | $3,000 or $115.38 from bi-weekly pay | |
| Total Member Contributions | $29,345 | $26,677 | |
| Total Employer DC Contributions | $8,003 | $7,114 | |
DB Plan assumptions: Final average salary of $128,887 and earns a guaranteed 4% on contributions and interest. Member leaves these in for maximum pension benefit. The base DB contribution rate is 5.50% for Class T-G and 4.50% for Class T-H. Shared Risk/Shared Gain rate is not applied. Visit psers.pa.gov for the most current contribution rates.
DC Plan assumptions*: 26 pay periods per year and 6% rate of return.
| Your Default Option | Your Other Elective Options | ||
|---|---|---|---|
| Class T-G Highest guaranteed retirement benefit | Class T-H Reduced guaranteed retirement benefit | Class DC Value of account at time of distribution | |
| Total Retirement Benefit | $1,180,622 | $1,030,569 | $817,722 |
| Retirement Benefit Breakdown | $56,388 Annual Pension for life + DC Plan Account of $430,380 at retirement | $45,110 Annual Pension for life + DC Plan Account of $430,380 at retirement | No Annual Pension (You assume all investment risk) + DC Plan Account of $817,722 at retirement |
| First Year Member Contribution | $4,125 or $158.65 from biweekly pay | $3,750 or $144.23 from bi-weekly pay | |
| Total Member Contributions | $249,406 | $226,733 | |
| Total Employer DC Contributions | $68,020 | $60,462 | |
DB Plan assumptions: Earns a guaranteed 4% on contributions and interest. Member is non-vested and must withdraw contributions and interest. The base DB contribution rate is 5.50% for Class T-G and 4.50% for Class T-H. Shared Risk/Shared Gain rate is not applied. Visit psers.pa.gov for the most current contribution rates. You are eligible for a refund of your DB contributions and interest if you terminate employment before becoming vested.
DC Plan assumptions*: 26 pay periods per year and 6% rate of return.
| Your Default Option | Your Other Elective Options | ||
|---|---|---|---|
| Class T-G Highest guaranteed retirement benefit | Class T-H Reduced guaranteed retirement benefit | Class DC Value of account at time of distribution | |
| Total Retirement Benefit | $58,006 | $52,713 | $54,895 |
| Retirement Benefit Breakdown | $0 Annual Pension for life + DC Plan Account of $28,892 at retirement | $0 Annual Pension for life + DC Plan Account of $28,892 at retirement | No Annual Pension (You assume all investment risk) + DC Plan Account of $54,895 at retirement |
| First Year Member Contribution | $4125 or $158.65 from biweekly pay | $3750 or $144.23 from bi-weekly pay | |
| Total Member Contributions | $36,681 | $33,346 | |
| Total Employer DC Contributions | $10,004 | $8,892 | |
Frequently Asked Questions
A. Only those who become new members of PSERS after July 1, 2019, will be provided with this opportunity. If you have not yet qualified for membership, or have been a member before, you will not receive a class election notice.
If you believe you meet the requirements and you have a PSERS MSS account, check to see if your election documents were delivered to your account electronically or contact our Member Service Center at 1.888.773.7748 immediately so we can verify if you should have received the notice.
When you register for MSS, you select how you would like to receive documents from PSERS -- through Paperless Delivery or by mail. Members with Paperless Delivery are sent an email notifying them when their statements and documents are generated and available on the "My Documents" page in MSS. You can manage your paperless settings at any time. Ensure you receieve important updates from PSERS by checking your Spam folder and adding the following email addresses to your contacts: RA-PSERS_Alert@pa.gov; RA-PSV3@pa.gov; RA-PSERSNews@pa.gov.
A. No, the election deadline will not be extended. The Retirement Code specifically stipulates that a member will receive only a 90-day opportunity to make this decision.
A. No. PSERS will notify your employer and your employer will then begin withholding contributions from your pay at the lower contribution level required for Class T-H and Class DC members.
A. The election you have made is retroactive to your first day of qualifying membership in PSERS. The Class T-G defined benefit (DB) contribution rate was higher than your newly elected membership class so the excess DB contributions you made will be used to make your defined contribution account whole and the remaining excess contributions will be refunded to you directly by PSERS.
