As a CalSTRS member, you may add to your service credit, which is used to calculate your retirement
benefit. The more service credit you have, the larger your monthly retirement benefit. The following
explains how you may increase your service credit.
Retirement formula
To better understand the importance of service credit, it is helpful to know how the retirement benefit
is determined. The retirement benefit calculation formula is set by law and multiplies three elements:
your years, or parts of years, of service credit; a percentage based on your age at retirement, called
the age factor; and your highest average earnable salary, generally for any period of three consecutive
years, called final compensation.
Benefit Enhancements
Benefit changes enacted over the past few years provide incentives for CalSTRS members who retire with
over 25 and 30 years of service credit. These benefit enhancements include the following:
Career Factor - If you retire with 30 or more years of service credit, 0.2 percent will
be added to the age factor, up to a maximum combined age factor and career factor of 2.4 percent.
One-Year Final Compensation - If you retire with 25 or more years of service credit,
your highest one year of earnable compensation will be used in your retirement benefit calculation,
rather than the average of your three highest consecutive years of earnable compensation.
Longevity Bonus - If you have accumulated at least 30 years of service credit by January 1, 2011,
a longevity bonus will be added to your monthly Member-Only retirement benefit. The longevity bonus amount
ranges from $200 to $400, depending on the years of service credit at retirement.
Permissive Service Credit
Additional, or permissive, service credit can be purchased for performing non-CalSTRS work activities
or for service credit you would have earned while on an employer-approved leave. These activities
include:
Nonqualified Service Credit
Nonqualified Service Credit is not related to any prior employment. If you have at
least five years of CalSTRS service credit, you can buy up to five years of Nonqualified Service
credit. Although this credit is included in the retirement calculation, this service credit cannot be
used for meeting eligibility requirements for any CalSTRS benefit enhancements.
Redeposit
Redeposit or buy back of CalSTRS retirement funds you previously withdrew when you terminated
your CalSTRS-covered employment. You can redeposit your funds if you return to CalSTRS membership or
are a member of certain other California public retirement systems. You can also redeposit an amount
equal to the contributions withdrawn by your former spouse or registered domestic partner as part of
a community property settlement.
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