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Class Election

Choosing the Right Membership Class for You


Resources:Class Election Presentation | Class Election Insert | Confirmation of Class Insert | DC Investment Options  MSS Quick Start Guide 
If you started school service before July 1, 2019, please see Class T-F Election Resources.
If you are under 18, restrictions apply.  Please see "Members Under Age 18" for more information.

As a school employee who first became an active member of PSERS on or after July 1, 2019, you are automatically enrolled as a Class T-G member. Class T-G provides a hybrid retirement that has both a Defined Benefit (DB) and a Defined Contribution (DC) component for your retirement benefit. You have an election period to decide if you would like to remain Class T-G or elect another hybrid membership class with different contribution rates (Class T-H) or a defined contribution only membership class (Class DC).

Class T-G is the default Membership Class in which you contribute the most to your DB component of your retirement benefit for the guaranteed highest monthly benefit at retirement.  Class T-G also has the highest Employer DC Contribution Rate of the three Classes.

No action is required to remain in Class T-G.  Remember, your decision to remain Class T-G or elect Class T-H or Class DC is irrevocable.

Member Contribution

+

Employer Contribution

+

 Voluntary Contribution
(after-tax/rollover)

+ / -

Investment Performance

=

Total
Account Value


 Accordion ‭[3]‬

Expand AllClick here for a more accessible version

​How are Class T-G, Class T-H, and Class DC different?

Click here to view chart
  Your Default Option
Class T-G
(Hybrid of DB & DC Plans)
Elective Option
Class T-H
(Hybrid of DB & DC Plans)
Elective Option
Class DC (DC Plan)
Total Member Contribution Rate8.25% (DB: 5.50% + DC: 2.75%7.50% (DB: 4.50% + DC: 3.00%)7.50%​
Employer Contribution Rate to Member's DC Account2.25%
2.00% 
Vesting Period (When you qualify for a benefit)10 years (or afe 67 with 3 years of service) - DB Plan 3 eligibility point - DC Employer Contributions/Earnings ​ No DB Plan
3 eligibility point - DC Employer Contributions/Earnings​
Total Retirement BenefitDB = 1.25% x FAS x Years of Service + Value in DC account at the time of retirement DB = 1.00% x FAS x Years of Service + Value in DC account at the time of retirement​No DB Plan.  Value in DC account at the time of retirement
Your Total Retirement is based on...Guaranteed monthly benefit (DB Plan) + Contributions (DC Plan) and the investment performance​Contributions (DC Plan) and the investment performance
Purchasing Service, Disability Retirement, Electing Multiple ServiceYes​No, except for USERRA
Normal Retirement Age For the DB Plan, earlier of:
  • Age 67 with 3 years of service
  • Combination of yearsand service equaling 97 with at least 35 years of service
For the DC Plan, distribution upon termination of service
For the DB Plan, age 67 with 3 years if service
For the DC Plan, distribution upon termination of service
​N/A (Distribution upon termination of service)
Early Retirement MilestoneAge 57 with 25 years of service

Age 55 with 25 years of service

​N/A

Click here for a printable version


Membership Class Snapshot:

Class T-G guarantees the highest monthly DB benefit at retirement. You also contribute to the DC component of your retirement, which allows you to potentially grow the money that you set aside for retirement based on the performance of the investment markets. Compared to Class T-H, Class T-G has a higher DB member contribution rate and a higher employer DC contribution rate, but a lower participant DC contribution rate.

Class T-H guarantees a monthly benefit from the DB component that is lower than Class T-G. You also contribute to the DC component of your retirement, which allows you to potentially grow the money that you set aside for retirement based on the performance of the investment markets. Compared to Class T-G, Class T-H has a lower DB member contribution rate and a lower employer DC contribution rate, but a higher participant DC contribution rate.

Class DC provides no guaranteed monthly benefit at retirement because there is no DB component to your retirement benefit. The value of your DC account is based solely on what you and your employer contribute to the DC Plan and the performance of those contributions in the investment markets based on the investment options you choose. The employer DC contribution rate is the same as Class T-H, which is lower than that of Class T-G.

 

 Accordion ‭[2]‬

Expand AllClick here for a more accessible version

​Class Election Examples

Starting Salary $25,000 with 3% annual increases, working for 35 years (normal retirement)
DB Plan assumptions: Final average salary of $64,433 and earns a guaranteed 4% on contributions and interest. Member leaves these in for maximum pension benefit.

DC Plan assumptions*: 26 pay periods per year and 6% rate of return.

 Your Default OptionYour Other Elective Options
  Class T-G
Highest guaranteed retirement benefit
Class T-H
Reduced guaranteed retirement benefit
Class DC
Value of account at time of distribution
Total Retirement Benefit$538,581$499,774$408,861
Retirement Benefit Breakdown$28,190 Annual Pension for life + DC Plan Account of $215,190 at retirement $24,807 Annual Pension for life + DC Plan Account of $215,190 at retirement No Annual Pension (You assume all investment risk) + DC Plan Account of $408,861 at retirement
First Year Member Contribution$2,062.60 or $79.33 from biweekly pay $1,875 or $72.11 from bi-weekly pay ​
Total Member Contributions$124,703

$113,366

Total Employer DC Contributions$34,010

$30,231

Starting Salary $25,000 with 3% annual increases, working for 8 years (non-vested)
DB Plan assumptions: Earns a guaranteed 4% on contributions and interest. Member is non-vested and must withdraw contributions and interest. You are eligible for a refund of your DB contributions and interest if you terminate employment before becoming vested.

DC Plan assumptions*: 26 pay periods per year and 6% rate of return.

  Your Default Option Your Other Elective Options
  Class T-G
Highest guaranteed retirement benefit
Class T-H
Reduced guaranteed retirement benefit
Class DC
Value of account at time of distribution
Total Retirement Benefit$29,003$26356$27,447
Retirement Benefit Breakdown$0 Annual Pension for life + DC Plan Account of $14,446 at retirement $0 Annual Pension for life + DC Plan Account of $14,446 at retirement No Annual Pension (You assume all investment risk) + DC Plan Account of $27,447 at retirement
First Year Member Contribution$2,062.60 or $79.33 from biweekly pay $1,875 or $72.11 from bi-weekly pay ​
Total Member Contributions$18,240

$16,673

Total Employer DC Contributions$5,002

$4,446

Starting Salary $40,000 with 3% annual increases, working for 35 years (normal retirement)
DB Plan assumptions: Final average salary of $103,093 and earns a guaranteed 4% on contributions and interest. Member leaves these in for maximum pension benefit.

DC Plan assumptions*: 26 pay periods per year and 6% rate of return.

  Your Default Option Your Other Elective Options
  Class T-G
Highest guaranteed retirement benefit
Class T-H
Reduced guaranteed retirement benefit
Class DC
Value of account at time of distribution
Total Retirement Benefit$861,721$758,243$748,243
Retirement Benefit Breakdown$45,103 Annual Pension for life + DC Plan Account of $344,304 at retirement $36,083 Annual Pension for life + DC Plan Account of $344,304 at retirement No Annual Pension (You assume all investment risk) + DC Plan Account of $654,177 at retirement
First Year Member Contribution$3,300 or $126.92 from biweekly pay $3,000 or $115.38 from bi-weekly pay ​
Total Member Contributions$199,525

$181,386

Total Employer DC Contributions$54,416

$48,370

Starting Salary $40,000 with 3% annual increases, working for 8 years (non-vested)
DB Plan assumptions: Final average salary of $64,433 and earns a guaranteed 4% on contributions and interest. Member is non-vested and must withdraw contributions and interest. You are eligible for a refund of your DB contributions and interest if you terminate employment before becoming vested.

DC Plan assumptions*: 26 pay periods per year and 6% rate of return.

  Your Default Option Your Other Elective Options
  Class T-G
Highest guaranteed retirement benefit
Class T-H
Reduced guaranteed retirement benefit
Class DC
Value of account at time of distribution
Total Retirement Benefit$46,405$42,170$43,916
Retirement Benefit Breakdown$0 Annual Pension for life + DC Plan Account of $23,114 at retirement $0 Annual Pension for life + DC Plan Account of $23,114 at retirement No Annual Pension (You assume all investment risk) + DC Plan Account of $43,916 at retirement
First Year Member Contribution$3300 or $126.92 from biweekly pay $3,000 or $115.38 from bi-weekly pay ​
Total Member Contributions$29,345

$26,677

Total Employer DC Contributions$8,003

$7,114

Starting Salary $50,000 with 3% annual increases, working for 35 years (normal retirement)
DB Plan assumptions: Final average salary of $128,887 and earns a guaranteed 4% on contributions and interest. Member leaves these in for maximum pension benefit.

DC Plan assumptions*: 26 pay periods per year and 6% rate of return.

  Your Default Option Your Other Elective Options
  Class T-G
Highest guaranteed retirement benefit
Class T-H
Reduced guaranteed retirement benefit
Class DC
Value of account at time of distribution
Total Retirement Benefit$1,077,162$947,805$817,722
Retirement Benefit Breakdown$56,379 Annual Pension for life + DC Plan Account of $430,380 at retirement $45,103 Annual Pension for life + DC Plan Account of $430,380 at retirement No Annual Pension (You assume all investment risk) + DC Plan Account of $817,722 at retirement
First Year Member Contribution$4,125 or $158.65 from biweekly pay $3,750 or $144.23 from bi-weekly pay ​
Total Member Contributions$249,406

$226,733

Total Employer DC Contributions$68,020

$60,462

Starting Salary $50,000 with 3% annual increases, working for 8 years (non-vested)
DB Plan assumptions: Earns a guaranteed 4% on contributions and interest. Member is non-vested and must withdraw contributions and interest. You are eligible for a refund of your DB contributions and interest if you terminate employment before becoming vested.

DC Plan assumptions*: 26 pay periods per year and 6% rate of return.

 
  Your Default Option Your Other Elective Options
  Class T-G
Highest guaranteed retirement benefit
Class T-H
Reduced guaranteed retirement benefit
Class DC
Value of account at time of distribution
Total Retirement Benefit$58,006$52,713$54,895
Retirement Benefit Breakdown$0 Annual Pension for life + DC Plan Account of $28,892 at retirement $24,807 Annual Pension for life + DC Plan Account of $28,892 at retirement No Annual Pension (You assume all investment risk) + DC Plan Account of $54,895 at retirement
First Year Member Contribution$4125 or $158.65 from biweekly pay $3750 or $144.23 from bi-weekly pay ​
Total Member Contributions$36,681

$33,346

Total Employer DC Contributions$10,004

$8,892

 Accordion ‭[1]‬

Expand AllClick here for a more accessible version

Class Election FAQ

Q. I never received a Membership Class Election notice. What should I do?

A. Only those who become new members of PSERS after July 1, 2019, will be provided with this opportunity. If you have not yet qualified for membership, or have been a member before, you will not receive a class election notice. Click here for PSERS membership rules.

If you believe you meet the requirements and you have a PSERS MSS account, check to see if your election documents were delivered to your account electronically or contact our Member Service Center at 1.888.773.7748 immediately so we can verify if you should have received the notice.

Members with an MSS account are automatically enrolled in paperless delivery, which means that they will receive their statements communications electronically.  Members with an MSS account are sent an email notifying them when their statements and documents are generated and available on the "My Documents" tab on MSS. You can manage your paperless settings at any time through the "Paperless Option" tab. Ensure you receieve important updates from PSERS by checking your Spam folder and adding the following email addresses to your contacts: RA-PSERS_Alert@pa.gov; RA-PSV3@pa.gov; RA-PSERSNews@pa.gov.

Q. May I get more time to make my class election decision?

​A. No, the election deadline will not be extended. The Retirement Code specifically stipulates that a member will receive only a 90-day opportunity to make this decision.

Q. Do I need to inform my employer that I am electing another membership class?

​A. No. PSERS will notify your employer and your employer will then begin withholding contributions from your pay at the lower contribution level required for Class T-H and Class DC members.

Q. If I elect Class T-H or Class DC, which have a lower contribution rate than Class T-G, then what happens to my excess contributions?

​A. The election you have made is retroactive to your first day of qualifying membership in PSERS.  The Class T-G defined benefit (DB) contribution rate was higher than your newly elected membership class so the excess DB contributions you made will be used to make your defined contribution account whole and the remaining excess contributions will be refunded to you directly by PSERS.