The formula
2.5% × years of service × HAS = your monthly benefit (Option 1)
Service retirement: 2.5% of HAS for each year (and fraction) of service credit, up to 100% of HAS. Option 1 is the base. Your PERA Benefits p. 7, Defined Benefit Calculation; C.R.S. 24-51-603(1)(a)
Each year adds 2.5% of HAS. On a $6,000 HAS, that's $150 a month for each year.
| Years | 20 | 25 | 30 | 33.5 | 35 | 38 | 40 |
|---|---|---|---|---|---|---|---|
| % of HAS | 50% | 62.5% | 75% | 83.75% | 87.5% | 95% | 100% |
| On $6,000 | $3,000 | $3,750 | $4,500 | $5,025 | $5,250 | $5,700 | $6,000 |
Part years count: PERA's example is 33.5 years = 83.75%. Understanding Your Benefit Estimate PDF p. 1, What happens if I retire between boxes on the PERA HAS table? For 35+ years, add 2.5% to 87.5 for each year over 35 up to 100%. Your PERA Benefits pp. 17-25 (note under each PERA table) The most is 100%. Your PERA Benefits p. 12, Federal Limits on Benefits (an Option 1 benefit can never exceed 100% of HAS); C.R.S. 24-51-603(3)(a)
That's a full (service) retirement. Retire early and you get the smaller percentage in your HAS table instead: see reduced retirement tables. Which table you're on is on the PERA 1 to PERA 9 page, and the Rule of 80 to 90 page shows when a full benefit starts. To run the formula on an example, open the calculator with a PERA 2, age 61, 29 years member.
Your highest average salary (HAS)
HAS is an average monthly salary: the highest 12-consecutive-month periods of service credit with PERA contributions, averaged. Three years are used if you had five years of service credit on January 1, 2020; otherwise (or if you joined on or after that date) five years. Your PERA Benefits p. 7, Highest Average Salary (HAS)
The salary cap
PERA takes the highest annual salaries for four or six 12-month periods (they need not be consecutive or your last years). The lowest becomes the base year; the rest are put in chronological order and limited by an annual salary-increase cap. Your PERA Benefits p. 7
- 15% a year: Membership on or before Dec. 31, 2006 and eligible to retire on Jan. 1, 2011.
- 8% a year: Membership on or before Dec. 31, 2006 and not eligible to retire on Jan. 1, 2011.
- 8% a year: Membership on or after Jan. 1, 2007.
Your PERA Benefits p. 7
PERA's examples
3-year HAS: base year $22,013, then $23,050, $24,100, $25,600. Each raise is under the cap. Total $72,750 ÷ 36 months = $2,021 a month (our engine: $2,020.83). Your PERA Benefits p. 7, PERA 3-Year HAS Calculation Example
5-year HAS: base year $22,013, then $23,050, $24,100, $25,600, $25,600, $26,368. Total $124,718 ÷ 60 = $2,079 a month (our engine: $2,078.63). Your PERA Benefits p. 8, PERA 5-Year HAS Calculation Example
When a raise hits the cap (our example)
Four years of pay: $60,000, $62,000, $70,000, $72,000. The lowest, $60,000, is the base year.
| Cap | Year 1 | Year 2 | Year 3 | HAS a month |
|---|---|---|---|---|
| 8% | $62,000 | $66,960 | $72,000 | $5,582.22 |
| 15% | $62,000 | $70,000 | $72,000 | $5,666.67 |
Underlined amounts were limited by the cap. With the 8% cap, the $70,000 year counts as $66,960.
PERA limits how much each year's pay can rise in the HAS (8% or 15%). It doesn't say whether the limit is measured from the year before as paid or as already limited.
What we use: We measure from the year before as already limited. PERA's own examples stay under the limit, so they come out the same either way.
Your PERA Benefits p. 7School years and leave payouts
School and DPS Division members earn service credit weighted so that at least 8 months of salary in the August-July year earns a full 12 months (e.g. 1.5 months per month over 8 months). In that case the year's salary is spread over 12 months for HAS (e.g. $3,500 x 8 = $28,000 / 12 = $2,333.33). School and DPS Service Credit fact sheet PDF pp. 1-3
Unused leave paid in cash at termination may count as PERA salary and can increase service credit and HAS. Your PERA Benefits p. 12, Leave Time
The money purchase benefit
With five or more years of service, the benefit is the higher of the defined benefit and a money purchase benefit. With less than five years (retirement-eligible), only the money purchase benefit is paid. The money purchase benefit is based on life expectancy and the DB Plan account value at retirement plus a 100% match of contributions and interest; it is actuarially determined. Your PERA Benefits p. 7, Benefit Calculation, Money Purchase Benefit Calculation; C.R.S. 24-51-605.5
PERA pays the higher of the formula benefit and a money purchase benefit. The money purchase benefit depends on your account balance and PERA's factors, which aren't published.
What we use: We can't work it out. If your PERA estimate shows a money purchase amount, enter it and we use whichever is higher.
Your PERA Benefits p. 7, Money Purchase Benefit CalculationBenefits are also subject to the IRC Section 415 annual limit. Your PERA Benefits p. 12, Federal Limits on Benefits
From the sources
- A full service retirement pays 2.5% of your highest average salary (HAS) for each year of service credit, up to 100% of HAS. This is the Option 1 amount.Your PERA Benefits p. 7, Defined Benefit Calculation; p. 12; C.R.S. 24-51-603
- Partial years count. With 33.5 years you get 83.75% of HAS, between the 82.5% for 33 years and the 85.0% for 34.Understanding Your Benefit Estimate PDF p. 1
- Above 35 years, add 2.5% to 87.5% for each extra year. That reaches the 100% maximum at 40 years.Your PERA Benefits pp. 17-25 (note under each table)
- With at least five years of service, PERA pays the higher of this formula or a money purchase benefit. The money purchase benefit is based on your account balance plus a 100% match and on your life expectancy. With less than five years, you get only the money purchase benefit, starting at 65.Your PERA Benefits p. 7, Money Purchase Benefit Calculation; C.R.S. 24-51-602(2.3), 24-51-605.5
- Benefits are also limited by the federal IRS Section 415 limit. PERA suggests asking for a benefit estimate within a year of retiring.Your PERA Benefits p. 12, Federal Limits on Benefits
- PERA's highest average salary (HAS) is a monthly average of your highest years of pay. It uses your 3 highest years if you had five years of service on January 1, 2020, and 5 years if you didn't or if you joined after that date.Your PERA Benefits p. 7, Highest Average Salary (HAS)
- Each year in the HAS is any 12 consecutive months of service credit. The years don't have to be in a row or be your last years.Your PERA Benefits p. 7; Understanding Your Benefit Estimate PDF p. 2
- Raises are capped. PERA takes one extra year beyond the 3 or 5 it averages, uses the lowest as a base year, and limits each later year's increase to 8%. The cap is 15% if you joined by the end of 2006 and could retire on January 1, 2011.Your PERA Benefits p. 7
- PERA's 3-year example has a base year of $22,013, then years of $23,050, $24,100 and $25,600. They total $72,750, and $72,750 divided by 36 months gives a HAS of $2,021 a month.Your PERA Benefits p. 7, PERA 3-Year HAS Calculation Example
- School employees earn service credit on an August-through-July year. Working at least 8 months earns a full 12 months of credit, and that year's pay is spread over 12 months for the HAS. For example, $3,500 a month for 8 months becomes $2,333.33 a month.School and DPS Service Credit fact sheet PDF pp. 1-3
- Unused leave paid in cash when you leave may count as PERA salary and can raise your service credit and HAS. Money you put into 401(k), 403(b) or 457 plans doesn't lower your HAS.Your PERA Benefits p. 12, Leave Time
Questions
What is HAS in Colorado PERA?
Highest average salary: the monthly average of your highest 3 or 5 years of PERA salary. Each "year" is any 12 months in a row. Raises inside the HAS are capped.
Do I get 3 years or 5 years in my HAS?
3 years if you had five years of service credit on January 1, 2020. 5 years if you didn't, or if you joined on or after that date.
What's the most PERA will pay?
100% of HAS, which takes 40 years of service. Federal tax law (IRS Section 415) also sets a yearly limit.
What is the money purchase benefit?
An alternative worked out from your account balance and life expectancy. With five or more years of service PERA pays whichever is higher. PERA's benefit estimate shows it; we can't work it out.
Source: Your PERA Benefits: A Summary of the Colorado PERA Defined Benefit Plan, Revised April 2026, pp. 7, 8, 12, 17-25. Also: C.R.S. 24-51-602, 24-51-603, 24-51-605.5; Understanding Your Benefit Estimate; School and DPS Service Credit fact sheet. Last reviewed .