Defined Benefit Plan

A Benefit To Last A Lifetime

As a MERS Defined Benefit (DB) Plan member, you join nearly 90,000 public sector employees all across the state, many of them your friends and family, your neighbors and coworkers.

Sometimes referred to as a pension, it is a retirement plan that provides guaranteed and predictable lifetime income to vested participants throughout retirement, regardless of investment market fluctuation, or inflation.

How It Works

The amount of income is based on 3 factors:

Service credit: the number of years you’ve worked
Final average compensation (FAC): the average of your highest consecutive wages earned over a period of time determined by your employer
Benefit multiplier: is a specific percentage set by your employer

To qualify for benefits when you retire, you must meet your employer’s requirements, including age and years of service, called vesting.

The Benefit Formula

The Defined Benefit formula is as follows: Benefit plan multiplier multiplied by final average compensation (FAC) multiplied by years and months of service, divided by 12 for your monthly (Straight Life) amount.

Defined Benefit formula is your Benefit plan multiplier multiplied by final average compensation (FAC) multiplied by years and months of service, divided by 12 for your monthly (Straight Life) amount.
Example: $45,000 (FAC) x 25 (years) x 0.025 (multiplier of 2.5%) = $28,125 yearly or $2,343.75 monthly.

Retirement Eligibility

You can begin receiving retirement benefits when you reach the age and service requirements under your plan provisions. If you are vested, the standard retirement age is 60. Learn about the Defined Benefit retirement process.