The AAI buyout trades part of your Tier 1 yearly increase; the APB trades the whole pension you'd get after leaving teaching. Before you decide, estimate the monthly pension you'd give up in the calculator and compare payment options.
1. The AAI buyout (Tier 1, at retirement)
A one-time accelerated payment equal to a portion of your future annual increases. In return you waive the 3% compounded increase and receive a 1.5% noncompounded increase beginning at a later date. You decide before TRS Illinois processes your retirement claim; the decision is final and irrevocable. Tier 1 Guide p. 21, Optional Tier 1 Accelerated Annual Increase (AAI) Program Decision
| Keep the regular raise | Take the AAI buyout | |
|---|---|---|
| Lump sum now | None | Yes, a one-time payment |
| Yearly raise | 3% compounded Tier 1 Guide p. 23, Annual increases in annuity | 1.5% not compounded, "beginning at a later date" Tier 1 Guide p. 21, Optional Tier 1 Accelerated Annual Increase (AAI) Program Decision |
| Can you change your mind? | — | No. The decision is final. |
If a Tier 1 member takes the AAI buyout, the 1.5% raises start 'at a later date'. The guide doesn't say when.
What we use: We don't guess the date, so we don't project AAI-buyout raises. Ask TRS Illinois for the start date.
The guide doesn't say how the AAI buyout payment is worked out.
What we use: We don't estimate the payment. TRS Illinois sends an estimate when you ask at retirement.
To compare the two raises on the same pension, see Yearly increases.
2. The APB buyout (inactive members)
Inactive Tier 1 members with at least 5 years of TRS Illinois service and inactive Tier 2 members with at least 10 years, through June 30, 2028. Eligible members are notified by mail. TRS Illinois Tier 2 slides, slide 66, Accelerated Pension Benefit (APB)
The buyout equals 60% of the present value of the member's anticipated lifetime pension benefit. TRIP coverage is available to APB participants when normal retirement age is reached if they have at least 8 years of TRS Illinois service. TRS Illinois Tier 2 slides, slide 66, Accelerated Pension Benefit (APB)
Taking it means giving up any monthly TRS Illinois pension. Weigh it against what you'd collect over your life.
The APB buyout is 60% of the present value of your pension, but TRS Illinois doesn't publish the interest and life-expectancy figures it uses.
What we use: We don't estimate a dollar amount. TRS Illinois mails eligible members an offer.
Before you decide
- Ask TRS Illinois for the dollar amount of the buyout and for your monthly pension without it.
- Ask how the payment is taxed and whether it can be rolled over. The guides we read don't say. See Taxes for what they do say.
- Think about how long you expect to live and whether you'd rather have guaranteed income.
What the guides say
- Tier 1 Accelerated Annual Increase (AAI) buyout: at retirement you can take a one-time payment and give up the 3% compounded increase for a 1.5% non-compounded increase that starts later. The decision is final.Tier 1 Guide p. 21
- The AAI buyout and the inactive-member buyout (APB) are available through June 30, 2028.TRS Illinois Tier 2 slides, slide 64
- Accelerated Pension Benefit (APB): inactive members (Tier 1 with 5+ years, Tier 2 with 10+) can trade the whole pension for a lump sum equal to 60% of its present value. TRS Illinois notifies eligible members by mail.TRS Illinois Tier 2 slides, slide 66
- APB takers with at least 8 years can still join TRIP health coverage once they reach normal retirement age.TRS Illinois Tier 2 slides, slide 66
- Check with TRS IllinoisWhen the AAI buyout's 1.5% increases begin and how the payment is figured are set by statute, not by the member guide.Tier 1 Guide p. 21Guide says only 'beginning at a later date'; 40 ILCS 5/16-190.6 not yet downloaded (ilga.gov 403).
Questions
What is the TRS Illinois AAI buyout?
A choice for Tier 1 members at retirement: a one-time payment now, in exchange for a 1.5% simple yearly raise instead of the 3% compounded raise. The decision is final.
What is the APB buyout?
For inactive members (Tier 1 with 5+ years, Tier 2 with 10+): a one-time payment of 60% of the present value of your future pension, instead of any pension.
How long are the buyouts available?
Through June 30, 2028.
How much would the buyout pay me?
The guides don't give a formula you can use yourself. TRS Illinois figures the amount. Ask for an estimate before you decide.
Source: TRS Tier 1 and Tier 2 Member Guides, September 2026, Tier 2 meeting slides 64, 66; Tier 1 Guide pp. 21, 23. Last reviewed .