Does Your Date of Retirement Matter?

(April 21, 2009) – If your retirement is near, think carefully about your date of retirement. It could have consequences that will impact your NYSTRS benefit for life.

Most NYSTRS members choose July 1 as their retirement date because they are contracted to work through the end of the school year (June 30) and July 1 is their first date of eligibility. Others, however, may be entitled to retire earlier in the school year.

If you are entitled to retire before July 1, bear in mind a potential pitfall of doing so: You would likely not qualify for benefit improvement legislation that may be enacted before the end of the calendar year.

Here's why: Chapter 497 of the Laws of 2005 provides that any legislation affecting benefits provided by NYSTRS will take effect no later than June 30 of the year in which the legislation is enacted (unless the legislation specifies a different effective date). So if you retire July 1 and a law improving System benefits is passed before Dec. 31, you would be eligible for the improvement as the law will be considered in effect as of June 30 – the last day of your active member status.

However, if you retired on or before June 30, you would not be considered an active member as of June 30. As a result, you would not qualify for the benefit improvement.

In short, forfeiting some retirement dollars by choosing a July 1 date of retirement could be advantageous in the long run.

If you are near retirement, we urge you to discuss this matter with a NYSTRS representative at a consultation or by calling (800) 348-7298, Ext. 6250. Visit our Benefits Consultations page for a schedule of video and personal consultations.

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