# Home calculated pension estimate

A Few Notes Before You Start:

• Hazardous Duty calculations are different from the formula below.
• When you calculate years of service, count partial years as a decimal...so 21 years and 4 months of service should be translated into 21.333 years of service.
• If you take early retirement, the penalty is .5% per month, so 11 months of early retirement results in a 5.5% life-time penalty.

There are 4 pension beneficiary options to select from when you retire:

1. Straight Life (this means no reduction to your pension but the pension payments stop upon your last breath of air).
2. 100% Contingent (your designee will continue receiving 100% of your pension upon your death [this has the biggest reduction to your pension])
4. 10 or 20 Year Certain (your designees may collect your pension upon your death for the first 10 or 20 years of retirement)

The pension formula for Tier 2, 2A, & 3:

1.4% x average salary below the breakpoint (2019 breakpoint was \$83,400)
+
1.8333% x average salary above the breakpoint (2019 breakpoint was \$83,400)
x
years of credited service up to 35 years....if over 35 years of credited service: then add 1.625% x average salary x years of service over 35

THEN:  multiply this result by the factor selected from the charts based upon which beneficiary payment option you select.  To use these charts, find the page that is labeled as the "Member Age" which represents the retiree's age at retirement, then on that same page, find the age of the designated contingent...this will be the "factor" used to determine the final pension amount.

Example Retirement Calculation:  \$90,000 average salary, 37 years of service, age 61 at retirement, spouse is age 60.

Step 1 Find Pension amount up to the Breakpoint:  1.4% x \$83,400 [or whatever the breakpoint is for the retirement year] = \$1167.60

Note: if your average salary is below the breakpoint, then use 1.4% x Average Salary and Step 2 = 0

Step 2 Find Pension amount above the Breakpoint (if wages exceed the breakpoint):  1.8333% x \$6,600 = \$120.98  [the \$6600 is the amount over the breakpoint...\$90,000 - the breakpoint of \$83,400=\$6600]

Step 3 Add the two numbers from above:  \$1167.6 + \$120.98 = \$1288.58

Step 4 Multiply times the years of credited service (up to a maximum of 35) = \$1288.58 x 35 = \$45,100.23

Step 5 Add in the formula for years of service over 35 years (if applicable)= \$90000 x 1.625% x 2yrs= \$2925

Step 6 Add lines 4 and 5:  \$45100.23 + \$2925 = \$48025.23

This is your pension amount before you select a beneficiary option...if you select Straight Life, this is your pension.

Step 7 Apply the Factors from the Charts to the 4 Pension Options: determine your reduction based on the factors in the charts....for our example the retiree is 61, and the beneficiary is 60.  So based on the charts, we find the page listed as "Member Age 61":

100% Contingent has a factor of: .8807 from that page of the charts so the result from above would be \$48,025 x .8807= \$41,772
50% Contingent has a factor of:  .9366 from that page of the charts so the result from above would be \$48,025 x .9366= \$44,980
10 Year Certain has a factor of: .9860 from that page of the charts, so the result would be \$48,025 x .986 = \$47,353
20 Year Certain has a factor of: .9434 from that page of the charts, so the result would be \$48,025 x .9434 = \$45,307