Three ways a year helps
+1% or +2%
Each year since July 1, 2012 adds 1% of your highest average salary; 2% a year from July 1, 2015 if you had 20+ years on June 30, 2012. It stops at your maximum.
Handbook, p. 19, accrual chart, columns 'Accruals as of 7/1/12 (all members)' and 'Accruals as of 7/1/15 (if 20 or more years of service as of 6/30/12)'; Handbook, p. 41, Appendix A; R.I. Gen. Laws § 16-16-13(c)−7% to −9%
Retiring early? Each year closer to your full-pension date takes that year's cut away, for life.
Handbook, p. 18, Early Retirement Reduction ('Year(s) from full retirement / Percent Reduction / Cumulative Reduction'); R.I. Gen. Laws § 16-16-12(c)(iii) (monthly column)counts twice
A year of work adds a year of age and a year of service, so it moves you 2 points toward 95 (from age 62).
Handbook, p. 18, Rule of 95 ('your age and years of service must add up to 95 ... (but not lower than age 62)')For a teacher with a $79,621.81 average salary, 1% is $796.22 a year and 2% is $1,592.44 a year, for life.
Retiring at 60, one year before her full-pension age, the teacher would get about $39,246.92 a year (55.25%, less 9%). Working to 61 gave 56.25% of a higher average and no cut: $44,787.27. That one year added about $5,540.35 a year.
Worked under the 2012 law (1% a year after June 30, 2012).
ERSRI RIRSA Guide (Jan. 2012), pp. 14-15The rate for each of your earlier years is on the benefit formula page, and the early cut is explained in retiring early.
What the handbook says
- Each extra year of service adds 1% of your average salary (2% if you had 20+ years on June 30, 2012), up to your 80% or 75% maximum. If you are retiring early, a year also removes 7% to 9% of the early cut.Handbook, pp. 18-19
- Under the Rule of 95, a year of work adds a year of age and a year of service, so it counts twice toward 95.Handbook, p. 18, Rule of 95
- ERSRI's 2012 example: retiring at 61 instead of 60 meant 56.25% instead of 55.25% and no 9% early cut.ERSRI RIRSA Guide (Jan. 2012), p. 15
Questions
How much does one more year add to an ERSRI pension?
1% of your highest average salary (2% if you had 20+ years on June 30, 2012), until you reach your 80% or 75% maximum. If you'd be retiring early, a year also takes 7% to 9% off the early cut. A raise in your best years adds more.
Is it worth working past my full-pension date?
Each year still adds accrual until you hit your maximum, and a raise may lift your average. But you also give up a year of pension checks. The calculator's two-date comparison shows how long the bigger check takes to catch up.
Source: ERSRI Membership and Retirement Handbook, 10th edition, June 2020 (with the 2024 Article 12 changes from the Treasurer's guide, July 1, 2024), pp. 18, 19, 41. Also: Rhode Island General Laws; ERSRI's guide to the Retirement Security Act, Jan. 2012. Last reviewed .