NM

Educational Retirem

ent Board701 C

amino de los M

arquezSanta Fe, N

M 87502

YOUR RETIREMENTThe New Mexico Educational Retirement Act (ERA) is a Defined Benefit Plan, which means that you know what you will receive when you retire based on a formula. That formula is:

Your Final Average Salary(the average of your highest five

consecutive yearly earnings)

x Your Years of Service.0235

(the current multiplier set by New Mexico Statute)=Your Yearly Retirement BenefitEXAMPLE: Your retirement calculation may look similar to the following:

$35,000 x 27 x .0235 = $22,207.50 per year,or $1,850.63 per month

Under a Defined Benefit Plan, such as ERA, you will receive much more in retirement than you contributed to the plan. Some other retirement plans, such as 401k plans, are Defined Contribution Plans. You only receive what you put in plus any accrued interest earnings.

in the Educational Retirement system is a condition of employment in covered organizations in New Mexico. Members are required to contribute 7.825% of total earnings, deducted pre-tax, from each payroll check. Your employer contributes an amount equal to 10.9% of your salary. Members may withdraw their contributions only when they terminate covered employment in New Mexico. (Employer contributions are not refundable.) Forms are

available through your employer.

1You can retire under any of the following three plans:

25 years of earned service creditThis may be a combination of earned plus allowed service credit. (See other side of this brochure for a definition of allowed service.)2The Rule of 75 -

Your Age plus earned service credit equal 75

3

x

Allowed service credit does not count toward qualifying, but does count in benefits.

If you retire under this plan, your benefits are reduced if you retire before the age of 60.

Age 65 with 5 years of service credit

When can I retire? When can I retire?

Managing theManaging the

MembershipMembership

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2007-2008School Year

2007-2008School Year

Do I have a choice of how I receive my

Retirement Benefits?

Do I have a choice of how I receive my

Retirement Benefits?

You do have a choice. You may elect to receive your retirement benefits in one of the following ways:

This option provides you the largest monthly sum upon retirement. The benefit ends upon the member’s death.A beneficiary will only receive any balance left of the member’s contributions plus interest.

The member’s benefit is reduced.

Your beneficiary receives the same benefit upon your death.The member will receive the Normal Option if the beneficiary dies first.

The member’s benefit is reduced, but by a lesser amount than Option B.Your beneficiary receives 1/2 of your benefit upon your death.The member will receive the Normal Option if the beneficiary dies first.

Normal Option Option B Option C

What aboutBeneficiaries?

What aboutBeneficiaries?

Will I receiveany Cost ofLiving Adjustments?

In the year a retired member turns 65 and thereafter a Cost of Living Adjustment (COLA) will be granted. It is calculated as ½ the Consumer Price Index increase for the preceding year. Under current law, the maximum a member may receive is 4% and the minimum is 2%, or the full CPI increase if less than 2%.

Can I go back to work after I retire?

Under certain circumstances, you may return to full or part-time employment after you retire.

An ERB member may choose to return to full-time employment in an ERB-covered organization and “un-retire”. That is, you may choose to add to your retirement benefits by contributing more toward your ERB retirement.

You may return to full-time employment at any time with a business or organization not covered by ERB.

The Return-to-Work (RTW) program allows any ERB retiree who has been retired for one full year to be eligible to return to work full-time in an ERB-covered organization and receive their retirement benefits. They must not have been employed in any capacity (part-time, substitute, contractor) by any ERB employer for the 12 months immediately prior to applying for Return to Work status and must be certified as eligible by the ERB before returning to work. A RTW employee will not contribute to ERB and cannot earn additional retirement service.

An ERB member may choose to return to part-time employment in an ERB-covered organization providing they do not earn more than $15,000 per year or an amount calculated under .25 or less FTE (full-time equivalency) provision.

What is the difference between “Earned Service” and “Allowed Service”? Earned Service is granted for time that a member is working and contributing to ERB. In other words, you receive earned service credit for all the time you have been employed in New Mexico with an organization covered by ERB.

Need Assistance?w w w . n m e r b . o r g

ERB Santa Fe 505.827.8030ERB Albuquerque 505.888.1560ERB Las Cruces 575.647.3313

Allowed Service may be purchased at the actuarial cost and credited to a member’s account under ERB. It can include any of the following:

Employment in an accredited public or private school outside New MexicoEmployment in an accredited school within New Mexico not covered by ERBEmployment at a US. Military Dependents SchoolEmployment in an educational organization covered by the Federal Government in NMYears served in the military (The cost to purchase each year of military service is 10.5% of the member’s annual NM salary for all years of covered employment. It must be purchased within the first 3 years of employment with an ERB employer

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Note: There are special circumstances whereby members who leave covered employment to enter into active military service and re-enter covered employment within 18 months of discharge may receive up to 5 years of allowed service credit for the time spent in active duty.

Will I receiveany Cost ofLiving Adjustments?

Can I go back to work after I retire?

This information is intended as a general guide to the provisions of the New Mexico Educational Retirement Act. Members

are encouraged to contact the ERB with further requests for information.