Unreduced vs. Reduced Pensions

Deciding when to retire is a very personal choice. Factors may include your age, how long you have been teaching, your health and your financial situation. Your STRP pension gives you options that can help you decide what’s best for your individual circumstances.

You can retire with an “unreduced pension” if you meet one of the following criteria:

• Age 65;
• 30 years of eligibility service;
• Age plus eligibility service equal to 85 (minimum age 55); or
• 20 years of eligibility service (minimum age 60).

An unreduced pension means your pension payments will be the full amount to which you are entitled, based on the plan’s benefit formula.

If you have not met one of the criteria for an unreduced pension, but you wish to retire early, you may be able to do so with a reduced pension. A reduced pension means that a percentage of your pension payment will be reduced to account for the fact that you have retired earlier, and as a result will receive your pension payments for a longer period of time. You can retire as early as age 55 and receive a reduced pension, but the following reductions will apply:

• For service up to June 30, 2015:
  Your pension will be reduced by 3% for each year you are short of your unreduced retirement date. This reduction applies to your base pension and bridge benefit.
• For service after June 30, 2015:
  Your pension will be reduced by up to 6% for each year you are short of your unreduced retirement date.

It’s important to note that if you retire with a reduced pension, that reduction factor is applied permanently to your monthly pension for your entire life (and any applicable surviving spouse’s life).

For further information regarding the pension benefits and retirement eligibility dates in STRP, visit the STRP e-Guide.