December 2012 Issue
November 26, 2012

TRS: Claiming prior service can be beneficial

Source: NYSUT United

Q: I read in a recent column that I might be eligible for prior service credit for my previous employment at a BOCES. I had an evaluation to see if I could receive credit and the answer was yes. However, I was shocked to learn of the cost to do this. Is it worth it for me to do it?

A: It is generally important to make sure you have all the service credit for which you are eligible, because it may affect when your benefits begin and how much you will receive. The more credit you have, the sooner you can potentially retire and the larger your benefit will be when you do. Your amount of service credit also determines your eligibility for loans, vesting rights, disability coverage and death benefits.

In addition, with 10 years of membership or credit, Tier 4 members stop making 3 percent contributions toward their retirement.

It's good to start the process as soon as possible: You are able to purchase prior service after two years of New York state TRS service.

The cost varies depending on your tier. Prior service is cost-free for the few active members remaining in Tiers 1 and 2. For Tiers 3 and 4, the cost is 3 percent of salary received during the period of the service. In addition, Tier 4 members must pay interest of 5 percent per year. Tier 3 members must pay interest only on service under a former Tier 3 membership.

For Tier 5 (Jan. 1, 2010 to March 31, 2012), the cost is 3.5 percent of salary plus 5 percent interest. Tier 6 members, who joined the retirement system on or after April 1, 2012, must pay 6 percent.

Q: How is it determined how much pension credit I get for prior service? How do I apply?

A: The formula is 20 days equals a month of service credit and nine months equals a year. For more information on prior service, go to and check out the member handbook. You may also print a prior service claim form. Remember you can access your personal benefit information with an online MyNYSTRS account. With a MyNYSTRS account you can view your annual benefit profiles, sign up for e-newsletters, change your address, apply for a loan, register for the Pension & Retirement Education Program (PREP) and make an appointment for a benefits consultation.

Members are urged to submit their claims early. Priority is given to those who are retiring and Tier 4 members who will be eligible to end mandatory contributions as a result of the additional service.