Retirement Benefits and Options

Massachusetts provides different types of retirement benefits. A member’s monthly retirement allowance consists of an annuity and a pension. The annuity portion is based on the total amount of contributions and interest in a member’s annuity savings account on the date of the member’s retirement. Unless otherwise specified by law, the pension portion is the difference between the total retirement allowance calculated under the plan and the annuity.

1. Superannuation Retirement

A superannuation (“regular”) retirement allowance is calculated by a formula which includes the member’s age at retirement, years of creditable service, and salary average over a defined period of time. The specific formula used in a member’s retirement calculation will depend on when the person established membership in a Massachusetts contributory retirement system as well as his or her assigned group classification.

  • Superannuation Retirement– Membership prior to April 2, 2012

    For those employees who established membership in a Massachusetts contributory retirement system prior to April 2, 2012, the following guidelines apply.

    • Eligibility

      Groups 1, 2 and 4

      Members in Groups 1, 2 and 4 who established membership in a Massachusetts contributory retirement system prior to January 1, 1978 are eligible to retire upon attaining age 55. There is no minimum service requirement.

      If membership was established on or after January 1, 1978, and the employee is a member of Group 1 or 2, he or she must have at least ten (10) years of creditable service and be at least age 55 to be eligible to receive a retirement allowance. There is no minimum service requirement for members in Group 4. However, they must be at least 55 years old in order to retire and have performed the duties of a Group 4 member for at least 12 months prior to retirement.

      Members with at least twenty years of creditable service are eligible to retire at any age.

    • Calculation

      A member’s monthly retirement allowance is calculated using the member’s age at retirement, years of creditable service, and amount of the member’s high, three-year average salary. Only regular compensation is included in a member’s salary average.

      In addition, veterans are entitled to a veteran’s benefit equal to $15 per year for every year of creditable service, up to a maximum additional benefit of $300.

      A retiree’s benefit cannot exceed 80% of the high, three-year salary average. Group 1 employees reach the maximum benefit of 80% of regular compensation at age 65 with 32 years of service. Group 2 employees reach the maximum benefit allowed at age 60 and Group 4 employees at age 55. Please note that veterans can still receive the additional veteran’s benefit even if it causes their superannuation retirement allowance to exceed 80% of their average annual rate of compensation.

      To apply for a superannuation retirement allowance, please click on the Resources Tab and download an Application for Superannuation Retirement.

  • Superannuation Retirement– Membership on or after April 2, 2012

    For those employees who established membership in a Massachusetts contributory retirement system on or after April 2, 2012, the following guidelines apply.

    • Eligibility

      Group 1

      If membership was established on or after April 2, 2012, and the position held by the member is classified in Group 1, the member must have at least ten (10) years of creditable service and be at least age 60 to be eligible to receive a retirement allowance.

      Group 2

      If the position held by the member is classified in Group 2, the member must have at least ten (10) years of creditable service and be at least age 55 to be eligible to receive a retirement allowance. However, they must have performed the duties of a Group 2 member for at least 12 months prior to retirement.

      Group 4

      There is no minimum service requirement for members in Group 4. However, they must be at least 55 years old in order to retire and have performed the duties of a Group 4 member for at least 12 months prior to retirement.

    • Calculation

      A member’s monthly retirement allowance is calculated using the member’s age at retirement, years of creditable service, and amount of the member’s high, five-year average salary. Only regular compensation is included in a member’s salary average.

      In addition, veterans are entitled to a veteran’s benefit equal to $15 per year for every year of creditable service, up to a maximum additional benefit of $300.

      A retiree’s benefit cannot exceed 80% of the high, five-year salary average. Group 1 employees reach the maximum benefit of 80% of regular compensation at age 67 with 32 years of service. Group 2 employees reach the maximum benefit allowed at age 62 and Group 4 employees at age 57. Please note that veterans can still receive the additional veteran’s benefit even if it causes their superannuation retirement allowance to exceed 80% of their average annual rate of compensation.

      To apply for a superannuation retirement allowance, please click on the Resources Tab and download an Application for Superannuation Retirement.

2. Termination Retirement– Membership prior to April 2, 2012

Employees who established membership in a Massachusetts contributory retirement system prior to April 2, 2012, and who have accrued at least thirty (30) years of creditable service, who resign before attaining age 55 may be entitled to a termination retirement allowance.

Similarly, a member with at least twenty (20) years of creditable service:

  • who fails to be reappointed, or
  • whose office or position is abolished, or
  • who is removed or discharged from his or her office or position for a cause other than moral turpitude,may be entitled to a termination retirement allowance.

Calculation

A termination retirement allowance consists of an annuity and a pension equal to one-third of the highest average annual rate of regular compensation during any consecutive three year period.

3. Ordinary Disability Retirement

  • Ordinary Disability Retirement—Membership prior to April 2, 2012

    For those employees who established membership in a Massachusetts contributory retirement system prior to April 2, 2012, the following guidelines apply.

    • Eligibility

      A member who has accrued at least ten (10) years of creditable service and who becomes permanently incapacitated from performing the essential duties of his or her job as a result of illness or injury which is not duty related may apply for an ordinary disability retirement allowance.

    • Calculation

      For non-veterans, the ordinary disability retirement allowance is equal to the amount payable for a superannuation retirement. The benefit is calculated using the member’s age factor, creditable service and the member’s high, three-year average salary. If the member has not yet attained the age of 55, the age factor will be increased to 55, providing a larger benefit.

      Veterans will receive an allowance consisting of a pension equal to 50% of the regular compensation received during the last 12 months of employment, plus an annuity. In the event a veteran’s superannuation allowance is greater than the ordinary disability retirement allowance, the veteran will receive the greater benefit.

      For more information about disability retirement benefits in general, please refer to PERAC’s Guide to Disability Retirement for Public Employees found on the Resources tab. Members who wish to apply for an ordinary disability retirement allowance should contact our office.

  • Ordinary Disability Retirement—Membership on or after April 2, 2012

    For those employees who established membership in a Massachusetts contributory retirement system on or after April 2, 2012, the following guidelines apply.

    • Eligibility

      A member who has accrued at least ten (10) years of creditable service and who becomes permanently incapacitated from performing the essential duties of his or her job as a result of illness or injury which is not duty related may apply for an ordinary disability retirement allowance.

    • Calculation

      For non-veterans, the ordinary disability retirement allowance is equal to the amount payable for a superannuation retirement. The benefit is calculated using the member’s age factor, creditable service and the member’s high, five-year average salary. If the member has not yet attained the age of 60, the age factor will be increased to 60, providing a larger benefit.

      Veterans will receive an allowance consisting of a pension equal to 50% of the regular compensation received during the last 12 months of employment, plus an annuity. In the event a veteran’s superannuation allowance is greater than the ordinary disability retirement allowance, the veteran will receive the greater benefit.

      For more information about disability retirement benefits in general, please refer to PERAC’s Guide to Disability Retirement for Public Employees found on the Resources tab. Members who wish to apply for an ordinary disability retirement allowance should contact our office.

4. Accidental Disability Retirement

  • Eligibility

    A member who becomes totally and permanently incapacitated from performing the essential duties of his or her job as a result of illness or injury sustained, or hazard undergone, while in the performance of duties, may apply for an accidental disability retirement allowance.

    It is important that members file a notice of injury with the retirement system and their employer if they have an accident on the job or are exposed to a health hazard. Notice should be filed within 90 days of the occurrence in order to establish an official record of the injury and to later seek accidental disability benefits.

  • Calculation

    A member’s accidental disability retirement allowance consists of a pension that is 72% of the annual rate of regular compensation on the date of injury, OR 72% of the average annual rate of regular compensation for the last 12 months preceding the effective date of retirement, whichever is greater; plus an annuity, plus a benefit for dependent children. In addition, veterans are entitled to a veteran’s benefit equal to $15 per year for every year of creditable service, up to a maximum additional benefit of $300.

    The total accidental disability retirement allowance (pension and annuity) is capped at 75% of the annual rate of regular compensation if the member’s service entry date was after January 1, 1988.

    NOTE: There are certain presumptions that apply only to specific public safety personnel. (i.e., the Heart Law, Lung Law, Cancer Presumption) Members retiring for accidental disability retirement under one of the presumptions need not provide an injury date. The date of injury for purposes of calculating the member’s retirement allowance will be the date the member last received regular compensation. For more information about the presumptions and disability benefits in general, please refer to PERAC’s Guide to Disability Retirement for Public Employees found on the Resources tab.

    To apply for an accidental disability retirement allowance, please contact our office for assistance.

5. Involuntary Retirement

A department head is authorized to file an application to retire a member for disability or superannuation. All service and age requirements that apply to applications filed by members will apply to any employer-initiated applications. Under certain circumstances, a member may request a hearing before the retirement board within fifteen (15) days of receiving the involuntary application. Members who receive an involuntary application for retirement from their department head should contact the Middlesex County Retirement System office for guidance.

Retirement Payment Options

The payment options available to retirees are the same for all retirement types.

OPTION A: provides the highest payment to the retiree. All payments will cease upon the retiree’s death and no survivor benefits will be provided.

OPTION B: provides an allowance that is approximately 2% less than Option A. Upon the retiree’s death, the balance of the retiree’s contributions, if any, is paid to the retiree’s beneficiary.

OPTION C: is the joint and last survivor allowance. The retiree’s allowance is approximately 7% to 14% less than the Option A allowance. Upon the retiree’s death, the designated beneficiary will be paid a monthly allowance for the remainder of the beneficiary’s lifetime. The survivor benefit is equal to 2/3 of the retirement allowance that the retiree was receiving. A retiree may name only one person as the Option C beneficiary and it must be the retiree’s parent, spouse, sibling, child or former spouse who has not remarried.

Should a designated Option C beneficiary predecease the retiree, the retiree’s Option C benefit will “pop-up” to the Option A retirement allowance.

Please note that all retirees and Option C beneficiaries must receive their monthly allowance by direct deposit to a bank checking or savings account. A direct deposit authorization form can be downloaded from our website under the Resources tab.