Understanding Teacher Retirement Schedules

If you’re currently working as a teacher or considering education as a career, it’s useful to understand how your state’s teacher retirement system works. Each state sets its own guidelines for public employees’ retirement programs, but these systems share many similarities.

How Do Teachers Save for Retirement?

Teachers who work in a public school system typically have either a pension plan or a 401(k) retirement savings plan. The school districts that employ the teachers pay into these plans as a benefit, but many teachers also contribute money from their paychecks to these accounts, reports Nasdaq. Teachers, like other public employees, also have the ability to open 403(b) and 457(b) plans. Some teachers pay into the Social Security program and receive full or partial benefits during retirement.

How Long Do Teachers Work Before Receiving Retirement Benefits?

Teachers must work a certain number of years before they can collect their retirement savings. The exact number of years varies from state to state, but most states require them to work for at least five years. If they stop working in public education before they reach that threshold, they forfeit all or part of the money.

How Much Do Teachers Earn When They Retire?

Most states operate what’s called a defined-benefit pension plan that works similar to Social Security. When teachers retire, they receive income based on a formula instead of investment returns, reports Education Week. This formula typically takes into consideration the teacher’s average salary for the last few years of regular employment, years of service and age at retirement. Teachers who work for the state’s public education system receive a higher percentage of their salaries than those who leave earlier.

How Often Do Teachers Get Paid During Retirement?

Each state determines the pay schedule for retired teachers, but most of them spread out the payments over the year. For example, the NYC retirement system pays retired teachers once per month on the last business day of the month, according to the New York State Teachers Retirement System. Florida follows a similar schedule and lists the actual pay date on the Florida Department of Management Services website.

Do Teacher Receive Social Security?

Teachers can receive Social Security benefits only if they paid into the system. In states that opted out of the Social Security system for public employees, teachers don’t pay into it or receive benefits from it during retirement. Teachers who contributed to Social Security through another job may not received their full Social Security benefits because of the Windfall Elimination Provision. Other teachers may see a decrease in their Social Security survivor or spousal benefits if they qualify for the Government Pension Offset, according to Nasdaq.