The calculator compares retiring now with working one to four more years. Try the Tier 1 example below (age 56, 23 years) or the Tier 2 one (age 58, 28 years), then change it to your own numbers. Working longer also lowers your PEEHIP premium for each year past 25.
Each year adds
- Tier 1: 2.0125% of your average final salary a year: $1,006 a year on $50,000. Handbook p. 21, Retirement Benefit Factor ('2.0125%'); Ala. Code § 16-25-14(c)(1) ('Two and one-eightieth percent')
- Tier 2: 1.65%: $825 a year on $50,000. Handbook p. 22, Retirement Benefit Factor ('1.65%'); Ala. Code § 16-25-14(d)
Raises can add more, because your average final salary may go up too.
Example: Tier 1, age 56 with 23 years
| Retire | Service | Status | Monthly |
|---|---|---|---|
| 2026 | 23 yrs | not yet eligible | — |
| 2027 | 24 yrs | not yet eligible | — |
| 2028 | 25 yrs | full | $2,096 |
| 2029 | 26 yrs | full | $2,180 |
| 2030 | 27 yrs | full | $2,264 |
Our illustration on $50,000: not eligible until 25 years (at 58), then $84 more a month for each year. Ala. Code § 16-25-14(a)(1), (a)(4); Handbook p. 17, Service Retirement, Tier 1 Members
Example: Tier 2, age 58 with 28 years
| Retire | Service | Status | Monthly |
|---|---|---|---|
| 2026 | 28 yrs | not yet eligible | — |
| 2027 | 29 yrs | not yet eligible | — |
| 2028 | 30 yrs | early (−4%) | $1,980 |
| 2029 | 31 yrs | early (−2%) | $2,089 |
| 2030 | 32 yrs | full | $2,200 |
Our illustration on $50,000: eligible at 30 years (age 60) with a cut, full at 62. Ala. Code § 16-25-14(a)(4), (d) (as amended by Act 2022-222); Handbook p. 17, Tier 2 Members ('After accumulating 30 years of service credit with a 2% reduction for each year from age 62')
Dates assume you keep working full time.
One year of service per year.
Handbook p. 9 (no more than one year of credit per scholastic year)From the sources
- Each extra year of service adds 2.0125% (Tier 1) or 1.65% (Tier 2) of your average final salary each year. For a Tier 2 member under 62 with 30 years, waiting also shrinks the 2%-a-year cut.Handbook pp. 17, 21-22
Questions
How much does one more year add?
On a $50,000 average final salary, $1,006 a year (Tier 1) or $825 a year (Tier 2), before any raise.
Does working longer help a Tier 2 member under 62?
Twice: another year of service, and one year less of the 2%-a-year early cut.
Source: TRS Member Handbook, July 2026 edition (back cover "7-2026"), pp. 17, 21, 21-22, 22. Also: Code of Alabama Title 16, Ch. 25 and 25A. Last reviewed .