Retirement Benefits
Teachers' Retirement System (TRS) Defined Contribution Plan Chart
Download this chart from the state of Alaska's Introduction to the Defined Contribution Retirement Plan document (PDF)
| Feature |
Tier III
7/1/06 - Present |
Employee
Contribution |
Pre-tax contribution: 8% |
Employer
Contribution |
7% - DC account
1.75% Health Plan - determined by annual
actuarial valuation after FY07.
HRA - Flat dollar amount per employee based
on 3% of the employer’s average annual
employee compensation. |
| Vesting |
100% vested in employee contributions from
inception.
Vested in employer contributions
based on the following schedule: 25% after
2 years of service, 50% after 3 years, 75%
after 4 years and 100% after five years. |
Qualifications
for
Retirement |
None for investment account. Taxes and
penalties may apply if withdrawn before age
59 1/2. See requirements for Retirement
Medical Coverage. |
Benefit
Calculation
Formula |
DC account balance plus investment earnings. |
Alaska
Cost-of-Living
Increases
(COLA) |
None provided. |
Post
Retirement
Pension
Adjustments
(PRPA)
(Inflation
Protection) |
None provided. |
Retirement
Medical
Coverage |
Access to medical coverage at Medicare eligible age
with 10 years of service or at any age with 30 years
of service. Must retire directly from the system. If not eligible for Medicare, must pay full premium. May use health reimbursement arrangement (HRA)
account to pay premiums. Once the HRA is
exhausted, member self-pays premiums. When
eligible for Medicare, the percentage of premium
paid by the retiree or surviving spouse is as follows:
10-14 years of service - 30%
15-19 years - 25%
20-24 years - 20%
25-29 years - 15%
30 years or more - 10% |
Disability
Benefits |
Must be a total and presumably permanent disability whose cause is directly related to performance of
duties of the job or an on the job injury. Benefit is
40% of salary, earns service while on occupational
disability. Employer continues to make all required contributions as if the member were working, plus the
member’s required contributions to the DC account,
without deduction from the member’s disability
payment. Disability benefits cease when the member
becomes eligible for normal retirement at Medicare eligible age and 10 years of service or at any age
with 30 years of service. No medical insurance until
eligible for normal retirement. |
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