IMRF Retirement Benefits under the Regular Plan

Table of contents:

• About IMRF Retirement Benefits
• How do you qualify for a Regular IMRF pension?
• To apply for your pension
• Pension Payment Options
• Your pension formula
• Pension estimate chart
• Reaching maximum benefit
• Pension increases
• Supplemental benefit payment or 13th payment
• If you return to work
  

About IMRF Retirement Benefits

IMRF provides for retirement benefits under the Regular IMRF Plan and under the SLEP plan. In both cases, the pension is paid as long as you live and is increased by 3% of the original amount on January 1 of each year after you retire.

Some IMRF members can also retire under the Early Retirement Incentive.

IMRF pensions are effective on the first day of the month after employment terminates and are paid in advance on the first day of every month. If you retire at any time during a month, you receive full service credit for that month, and your pension will be effective on the first day of the next month.

You will receive your IMRF benefit payment by Direct Deposit. Direct Deposit ensures the security of the your monthly pension by having the benefit payment electronically deposited into your checking, savings, or brokerage account.

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How do you qualify for a Regular IMRF Pension?

• You must have at least eight years of service credit (can include reciprocal service).
• You must not be working in any position which qualifies for IMRF coverage. An elected official holding an office that qualifies for IMRF participation can remain in the office and receive an IMRF pension if:
  
• he/she did not choose to participate in IMRF when first elected and
• his/her pension is not based on any service earned in that elected position during any term of office.
  
• You must be at least age 55.
  • If you retire between age 55 and 60 and have less than 30 years of service credit, your pension will be reduced by 1/4% for each month you are under age 60.
  • If you retire between age 55 and 60 and have at least 30 but less than 35 years of service credit, your pension will be reduced by the lesser of
    • 1/4% for each month you are under age 60
      or
    • 1/4% for each month of service credit less than 35 years.
  • If you retire at age 60 or older or if you have 35 years of service credit, your pension will not be reduced.
  
  Please note: unused, unpaid sick days converted to service credit cannot be used to meet the eight-year requirement for an IMRF pension or to meet the 35-year requirement for a full pension under age 60.

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To apply for your pension

Obtain an application from your Authorized Agent. Fill it out and return it with the documents listed on the application.

Or you can download the retirement application form, IMRF Form 5.20.

IMRF pensions are effective on the first day of the month after you terminate employment. IMRF pays pensions in advance on the first day of every month. For example, your August pension will be paid to you on August 1. If you retire at any time during a month, you receive full service credit for that month, and your pension will be effective on the first day of the next month. If you retire on September 15, you will receive service credit for the month of September, and your pension will be effective on October 1. You will receive your first pension payment within 30 days of that date.

Please note: IMRF can “back date” a pension only 12 months. If you no longer participate in IMRF but are at least age 55, we recommend you apply for your pension.

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Pension Payment Options

When you retire, your initial pension payments are always based on IMRF’s Standard plan. However, you may be eligible for other payment options.

Standard plan

Under the Standard plan, you receive the same pension amount every month after you retire for the rest of your life, regardless of how long you live. Annually, IMRF pensions are increased by 3% of the original pension amount.

Optional Pension

If you retire before age 62, IMRF's Optional Pension permits you to choose a larger IMRF pension until age 62 and a reduced IMRF pension thereafter. After we receive a member’s retirement application and final wage report from his/her employer, IMRF will advise members under age 62 of the amounts payable under the Standard plan and under the Optional Pension. The calculations of the Optional Pension vary and can be computed on an individual basis only.

Special Needs Annuity option

Under the Special Needs Annuity option (also known as a "reversionary annuity"), you choose to to receive a smaller IMRF pension so that upon your death you can provide your spouse with a pension in addition to the IMRF surviving spouse pension or some other individual with a monthly pension, for example, your current spouse if he or she is not eligible for an IMRF surviving spouse pension, or a child, an ex-spouse, or any other person.

Therefore, the younger the age of the individual you name as your "Special Needs Beneficiary," the greater will be the reduction in your monthly pension. Retiring members choosing the Special Needs Annuity option must make this choice at the time of retirement by completing and submitting IMRF Form 5.20R. Your decision to revert to the Special Needs Annuity is irrevocable—it cannot be canceled or changed.

You can read the Special Needs Annuity brochure for more information.

Your choices under the Special Needs Annuity option

The percentage of the pension payable to the individual you name (the “reversionary annuitant”) depends upon whether you have a spouse eligible for an IMRF surviving spouse pension when you retire: this is ital

1. Your spouse is eligible for a surviving spouse pension (married for at least one year before you stop participating in IMRF):

Upon your death, your spouse would receive a surviving spouse pension equal to 50% of your unreduced Standard pension, that is, the pension you would have been receiving had you not chosen a Special Needs Annuity.

You can elect a Special Needs Annuity that will provide your spouse—or some other person—an additional pension equal to 25%, 35%, or 40% of the adjusted (reduced) pension you had been receiving. (You are not required to name your spouse. You can name some other individual as your Special Needs beneficiary.)

2. You have no spouse or your spouse is not eligible for a surviving spouse pension:

Upon your death, a surviving spouse pension is not payable.

You can elect a Special Needs Annuity that will provide any one individual a pension equal to 50%, 75% or 100% of your reduced pension, that is, the adjusted (reduced) pension you will receive if you choose a Special Needs Annuity.

In cases where a member’s spouse is not eligible for a surviving spouse pension, this option allows the member to provide a benefit which is similar to IMRF’s surviving spouse pension.

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Pension formula

Your IMRF pension is 1-2/3% of your final rate of earnings for each of the first 15 years of service credit, plus 2% of your final rate of earnings for each year of service credit in excess of 15 years. However, the total pension at retirement cannot exceed 75% of your final rate of earnings.

Final rate of earnings

Your final rate of earnings are your highest total earnings during any 48 consecutive months within your last 10 years of IMRF service divided by 48. Usually, this is the average of the last 48 months of service. However, the earnings considered for each of the last three months cannot be more than 25% greater than the highest earnings in any of the first 45 months of the 48 consecutive months.

Service credit

Service credit is your total time under IMRF, stated in years and fractions. Service is credited monthly while you are working, receiving IMRF disability benefits or while you are on IMRF's Benefit Protection Leave.

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Reaching Maximum IMRF Pension Benefit

IMRF Regular Plan Members will receive the maximum retirement benefit after earning 40 years of Regular Plan service credit.If you have 40 or more years of service credit, you can elect to stop making IMRF contributions. If you stop contributing, you will still have the same death and disability benefit protecting as contributing members.

For more information, complete IMRF Form 6.24, "Election to Cease Making IMRF Contributions"

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Pension increases

An IMRF pension is paid as long as you live and is increased by 3% of the original amount on January 1 of each year after you retire. The first year increase is prorated unless the effective date of the pension is January 1.

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