Retirement Benefits

for Tier 2 SLEP Plan Members
Seaside rocks

Earning an IMRF Pension

Your IMRF pension gives you life-long income protection. You earn service credit toward a Tier 2 SLEP Plan IMRF pension by:

You will continue to earn service credit if you are on IMRF Disability or on an IMRF Benefit Protection Leave.

You must have at least 10 years of SLEP service credit to receive a future SLEP pension. Once you have at least 10 years of SLEP service credit, you are guaranteed a pension for life. The more service credit you earn, the larger your pension will be.

Wage Caps

Under Tier 2, a member’s wages are capped at $123,489.18 in 2023. The wage cap for 2024 is $125,773.73. You do not pay any contributions on wages above the cap. The wage cap is also applied when IMRF calculates your benefits. The cap increases each year by the lesser of 3% or one-half of the increase in the Consumer Price Index (urban) for the preceding September. If the CPI-U is zero, the wage cap is not increased.

If you participate in the SLEP Tier 2 plan, any wages you earn as a result of overtime are not included as IMRF wages. You do not pay any contributions on overtime wages.

Receiving an IMRF Pension

To begin receiving an IMRF Tier 2 SLEP Plan pension, you:

Although you can retire as early as age 50, age 55 is your full retirement age. If you retire:

The following cannot be counted toward the 10-year requirement for a SLEP pension:

How Much Will Your Pension Be?

The amount of your pension is based on your earnings and your service credit. The Tier 2 SLEP formula applies if you have at least 10 years of SLEP service credit. To calculate the amount of your pension, IMRF uses a formula that includes:

The formula to calculate a Tier 2 SLEP Plan pension is 2.5% of your FRE for each year of SLEP service credit. Your total pension at retirement cannot exceed 75% of your final rate of earnings.

Final Rate of Earnings (FRE)

Your highest average earnings will most likely come later in your IMRF career. If this is the case, the FRE used to calculate your pension will be your highest total earnings (up to the wage cap) during any 96 consecutive months within your last 10 years of IMRF service, divided by 96. Usually, this is the average of the last 96 months of service.

Alternative FRE formula: Lifetime FRE

If you have higher earnings at the beginning of your career, an alternate FRE is used. The Lifetime FRE is an average of all your earnings (up to the wage cap) reported by all your IMRF employer(s) over your entire IMRF career.

When you retire, IMRF will calculate your FRE using both methods and will use the FRE that provides you with the larger pension.

Service Credit

Service credit is your total time under IMRF, stated in years and months.

Create Pension Estimates in Member Access

Use the Pension Estimator in your Member Access account to create your own pension estimates. You can customize your estimates using a variety of different situations, such as different ages at retirement, different amounts of future service credit you think you might earn, etc.

If You Vest For SLEP And Have Other IMRF Service

If you retire with 10 or more years of SLEP service credit plus other periods of non-SLEP service under IMRF, you will receive a Regular pension in addition to your SLEP pension.

If You Do Not Vest for SLEP

If you retire with less than 10 years of SLEP Tier 2 service credit but have other Regular service:
Regular Tier 1 and SLEP Tier 2
Eight or more years of total service
Your service will be combined to determine a Regular Tier 1 pension. Your SLEP contributions will be refunded with interest.
Regular Tier 2 and SLEP Tier 2
10 or more years of total service
Your service will be combined to determine a Regular Tier 2 pension. Your SLEP contributions will be refunded with interest.

Annual Pension Increases

Annual increases begin whichever January first below is later:

Each January 1 increase will be calculated on your original benefit amount, and will be the lower of:

Supplemental Benefit Payment ("13th Payment")

After you have retired and have received pension payments for at least 12 months in a row, you will be eligible for a supplemental benefit payment every July. When you first retire, you must have retired on or before June 30 to receive a 13th Payment the next year. For example:

If you retire… You will receive your first 13th Payment in…
On or before June 30, 2017 July of 2018
After June 30, 2017 July of 2019

You will receive this supplemental payment with your usual July pension payment. The amount varies every year, but it will always be less than your monthly pension amount.