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The Illinois State Employees Retirement System (SERS)

Is a Defined Contribution Benefit Plan

The State Employees Retirement System (SERS) of Illinois is funded through a combination of contributions by the state, employers of certain public workers, and employees who have qualified for state-sponsored pensions. These contributions go into a fund which is invested by the SRS Board of Trustees.

When you are hired as a state employee, you need to serve a six-month qualifying period before becoming a member of the retirement system.

Once you become a member, your contributions are made from your pre-tax earnings. The amount you contribute is determined by your occupation and whether or not you also pay into Social Security.

Two Tiers Of SERS Membership

There are two tiers of membership which determine your normal retirement age and the number of years of service credit required to retire.

You fall under Tier 1 if you joined SERS before January 1, 2011, and you can retire with pension benefits once you reach age 60 with at least 8 years of vested service credit. Or, if you have 25 to 30 years of service credit, you have the option of retiring between the ages of 55 and 60. However, the amount of your benefit will be decreased by a predetermined percentage for every month you are under age 60.

You fall under Tier 2 if you joined SERS on or after January 1, 2011, and you will need to work slightly longer, and complete more years of service credit, before you can retire. Tier 2 members can retire at age 62 with at least 10 years of vested service credit. As a Tier 2 member your pension will be decreased by a predetermined percentage for each month you’re under age 67 when you file for retirement. If you wait until age 67 or older to file for retirement, your benefit may increase by as much as 3%.

Cost of Living Adjustment (COLA)

In Illinois, all retirees receive an automatic Cost of Living Adjustment (COLA) in addition to their regular monthly benefit. Your yearly COLA increase helps to ensure that the purchasing power of your pension is not eroded by inflation. The amount of the COLA you receive depends on whether you’re a member of Tier 1 or Tier 2.

Other Illinois Pension Plans

The State of Illinois funds four other retirement systems for public employees and retirees. Though each system covers specific occupations, and may have its own age and work credit requirements for retirement, in general they function similar to the SERS system. These include:
  • 1.The Judges’ Retirement System (JRS)
  • 2.The General Assembly Retirement System (GRS)
  • 3.The State Universities Retirement System (SURS)
  • 4.The Teachers’ Retirement System (TRS) which includes all Illinois public school teachers except those employed by the Chicago Board of Education.
Illinois Pension Plans

SERS FAQs

How long do I need to work before I am vested in SERS?

It depends on which tier you fall under. The vesting period is 8 years for Tier 1 participants (joined SERS prior to January 1, 2011). The vesting period for Tier 2 participants is 10 years (joined SERS on or after January 1, 2011).

What is the SERS retirement Age?

It depends on which tier you fall under.

You fall under Tier 1 if you joined SERS before January 1, 2011, and you can retire once you reach age 60 with at least 8 years of vested service credit.

You fall under Tier 2 if you joined SERS on or after January 1, 2011, and you can retire at age 62 with at least 10 years of vested service credit.

Do I have to pay Federal Income Taxes on SERS retirement benefit?

Yes – once you retire and start receiving your SERS retirement benefits as income, those payments become subject to Federal taxes.

Will my SERS retirement benefits be reduced by Social Security Benefits I receive?

No – SERS does not reduce your benefit once you become eligible for Social Security. However, if your SERS pension is calculated using service not covered by Social Security, this may affect your Social Security benefit. Contact the Social Security Administration for more information.
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