What is Final Average Salary?
Final Average Salary, or FAS, is a calculation used to compute the retirement allowances of TRS members. The method for calculating FAS is based on your tier status; to learn how your FAS is calculated, please see the FAQ for your tier.
How can I submit my retirement application?
We suggest that you return your retirement application to TRS in person; that way, a TRS representative can check the application and ensure that it is completed correctly. You may also return your application to TRS by mail if you believe you have accurately completed it. However, please note that mistakes on applications can cause processing delays.
Will TRS help me complete an application?
Yes. Member Services Representatives can help you by answering inquiries over the phone or in person. In fact, if you are submitting a retirement application, we recommend that a Member Services Representative review it with you in person first.
When are retirement allowance checks distributed?
Retirement allowance checks are mailed three business days before the end of the month. EFT funds are wired to financial institutions on the last day of the month.
Is my first retirement allowance payment retroactive?
Yes. If you receive advance payments, your first payment will be retroactive to your effective retirement date (or initial payability date, if you retired under deferred payability). Your first regular payment will contain the amount you are due from the date of retirement, minus any advance payment(s) you have received, plus applicable interest.
What are advance payments?
In order to provide you with retirement income as quickly as possible, TRS issues advance payments of your retirement allowance beginning with the payroll approximately one to two months following your effective retirement date (or initial payability date, if you retired under deferred payability). However, if your regular retirement allowance is available at that time, you would receive your regular retirement allowance instead.
If TRS cannot finalize your retirement allowance within four months of your retirement date, we would increase the amount of your advance payments, so that they would be closer to the amount you will receive once your retirement is finalized.
Advance payments are not estimates of your retirement allowance payments; in fact, your advance payments are designed to be smaller than your retirement allowance payments. The advance payment calculations do not reflect all the factors used to determine your retirement allowance payments. TRS calculates your advance payments based on your retirement plan choice, payment election, salary, and any applicable age-reduction factor. Total Service Credit is not used in the advance payment calculations.
Can I pay my own federal taxes once I retire?
Yes. However, you should ask the Internal Revenue Service or your tax consultant for advice regarding "estimated taxes" in order to avoid the possibility of penalties due to underpayment.
How do I prepare for the retirement process?
If you are contemplating retiring soon, you may be wondering how to begin. It's important to begin preparing for the application process well in advance of your intended retirement date.
The following checklist should help you prepare for the retirement process.
- Review your service credit as soon as possible, to ensure you are eligible to retire;
- Consider taking a loan or, if applicable, an excess withdrawal;
- Choose a method of distribution for your TDA funds;
- Elect a payment option and designate your beneficiaries, if applicable;
- Tier I and II members should make a QPP investment election at retirement;
- File the Service Retirement Application for your tier;
- Read any of the applicable TRS Retirement Series brochures; and
- Check for the forms you may need to file with your retirement application
If I am a Tier I member, how would my Final Average Salary (FAS) be calculated?
If you have served at least three years in the position from which you are retiring, your FAS generally would be the actual gross salary earnable during the 12 months prior to your retirement. If you have served less than three years in the position from which you are retiring, your FAS generally would be your annual earnable salary during the last year of the most recent position you held for at least three years. You may instead elect to have your FAS be your average annual salary earnable during any five consecutive years.
If I am a Tier II member, how would my Final Average Salary (FAS) be calculated?
Your FAS generally would be the average of your highest three consecutive annual salaries. However, if the salary you earned during any year included in the three-year period exceeds the average of the previous two years by more than 20%, the amount in excess of 20% would be excluded from the calculation.
If I am a Tier III or IV member, how would my Final Average Salary (FAS) be calculated?
Your FAS generally would be the highest average of wages earned during any continuous period of employment for which you were credited with three years of service (subject to certain exclusions). Wages earned during any year used in a FAS calculation cannot exceed the average of the previous two years' wages by more than 10%; the amount in excess of 10% would be excluded from the computation of FAS.
If I am a Tier VI member, how would my Final Average Salary (FAS) be calculated?
Your FAS generally would be the highest average of wages earned during any continuous period of employment for which you were credited with five years of service (subject to certain exclusions). Wages earned during any year used in a FAS calculation cannot exceed the average of the previous four years' wages by more than 10%; the amount in excess of 10% would be excluded from the computation of FAS.
How are performance increases considered in my Final Average Salary?
The collective bargaining agreement between the Council of School Supervisors and Administrators (CSA) and the New York City Department of Education provides for performance increases for qualifying members. Performance increase payments are pensionable and considered for a member's Final Average Salary, which is used to calculate retirement benefits.
Performance increases are awarded for achievement in a specific school year but are not paid until the following school year. For the purposes of determining Final Average Salary (FAS), performance increases count toward compensation for the year earned, not the year paid.
Example: In the 2017-2018 school year, a member earns a performance increase, which is paid in the 2018-2019 school year. At the time of retirement, when TRS determines the member's Final Average Salary, the amount of the increase will be included with the member’s compensation for the 2017-2018 school year (the year earned, not the year paid).
Members should be aware of this distinction when planning for retirement and when making any decisions concerning their FAS period.
Members should also note that performance increases are not reflected in the benefit estimates and projections that may appear in their Annual Benefits Statements; those calculations are based only on contractual salary.
If I am a Tier IV member, how would my service retirement allowance be calculated?
The regular pension portion of your retirement allowance is calculated based on factors such as your Total Service Credit and Final Average Salary (FAS), as indicated below.
Total Service Credit |
Service Retirement Allowance |
Less than 20 years |
1 2/3% of your FAS x years of Total Service Credit |
20-29 years |
2% of your FAS x years of Total Service Credit |
30 years or more |
60% of your FAS (for the first 30 years) + 1½% of your FAS x each year exceeding 30 years |
The second portion of your retirement allowance is based on your Annuity Savings Accumulation Fund (ASAF) balance. An ASAF account contains monthly supplemental contributions that the Department of Education provides to certain eligible employees who reach the maximum of their salary schedule. At retirement, any ASAF funds you have are transferred into an Annuity Reserve Accumulation Fund (ARAF), which is paid as part of your retirement allowance.
For more information, please see the If I am a Tier IV member, how would my Final Average Salary (FAS) be calculated? FAQ above.
If I am a Tier VI member, how would my service retirement allowance be calculated?
The regular pension portion of your retirement allowance is calculated based on factors such as your Total Service Credit and Final Average Salary (FAS), as indicated below.
Total Service Credit |
Service Retirement Allowance |
Less than 20 years |
1 2/3% of your FAS x years of Total Service Credit |
20 or more years |
35% of your FAS (for the first 20 years) + 2% of your FAS x each year exceeding 20 years |
The second portion of your retirement allowance is based on your Annuity Savings Accumulation Fund (ASAF) balance. An ASAF account contains monthly supplemental contributions that the Department of Education provides to certain eligible employees who reach the maximum of their salary schedule. At retirement, any ASAF funds you have are transferred into an Annuity Reserve Accumulation Fund (ARAF), which is paid as part of your retirement allowance.
For more information, please see the I am a Tier VI member, how would my Final Average Salary (FAS) be calculated? FAQ above.
What payment options may I elect for my retirement allowance?
You may elect to receive the maximum retirement allowance for which you are eligible. However, if you elect to provide for a beneficiary after you die, your retirement allowance would be reduced. The following choices are available regarding your beneficiary: options that provide lifetime benefits to your beneficiary after your death; options that enable your retirement allowance to "pop up" to the maximum if your beneficiary predeceases you; and options that guarantee that a certain number of retirement allowance payments will be made to you (or to your beneficiary, if you should die before the designated number of payments have been made). Tier I and II members also have the option of leaving a lump-sum amount to a beneficiary. In all cases, you would receive your retirement allowance for as long as you live. Please see the FAQs–Beneficiaries section for more information.
If I choose to receive the Maximum Payment Option, what would happen to my retirement allowance when I die?
All retirement allowance payments would cease upon your death. However, any amount due for the month in which you die would be payable to your fractional beneficiary.
In addition, for Tier II, III, IV, and VI retirees who are covered under Death Benefit #2, their Death Benefit #2 beneficiary may be eligible to receive a lump-sum post-retirement death benefit. See the FAQs about Death Benefits for more information.
Can I receive my retirement allowance in a lump sum?
In general, lump-sum payments of your retirement allowance are only permitted for terminally ill members (please see the TRS' Lump-Sum Disability Benefit brochure); however, all eligible members may apply for a loan from their funds in conjunction with retirement. If you are a Tier I and II member, you may also withdraw in a lump sum any amount in your Annuity Savings Fund (ASF) that is in excess of your minimum accumulation. (Please note that an outstanding loan or an excess withdrawal at retirement may result in a reduction of your retirement allowance payments.)
May I change the elections I make on my retirement application?
Yes. However, in general, TRS must receive any changes no later than one day before the effective payability date of your retirement allowance. If you filed a disability retirement application, TRS must generally receive any changes within 30 days after the date on which the Medical Board recommends your disability retirement. However, the Applicant's Personal Report and the Report of Applicant's Physician may not be amended after they are filed.
In addition, members who filed for retirement after October 31, 2003 or left service under a disability retirement after October 31, 2003 may change their retirement allowance payment options up to 30 calendar days after their payability date. Disability retirees of all tiers may now change their retirement payment options up to 30 days after their disability application is approved or 30 days from the date they retired as a result of the disability, whichever is later. Please note that for all eligible members, the 30-day allowance includes weekends.
What is my payability date?
Your payability date is generally the date on which you become eligible to receive a retirement allowance. If you are eligible for immediate payment of a retirement allowance, your payability date would be the same as your effective retirement date. However, if the receipt of your retirement allowance is deferred, your payability date would be either a) the date that you are eligible to begin receiving retirement allowance payments, or b) a subsequent date that you designate for payments to begin.
You may generally file your retirement application no sooner than 90 days before your effective retirement date, and TRS must receive your application no later than 1 day before your effective retirement. However, if you are a Tier I or Tier II member who wants to retire under a deferred payability, it would be in your best interest to file your retirement application as soon as you leave service. Your initial payability date will be deferred until the date you would have received 25 years of service credit had you remained in service. Once TRS receives your retirement application, we will begin counting towards the 25-year service credit date. For example, a 62-year-old member leaves service after acquiring 20 years of service credit. Five more years must elapse before the member can begin receiving deferred retirement payments, but TRS does not begin counting down those five years until we receive that member's retirement application. If the member were to wait five years and then file an application, five additional years would have to elapse before the member can receive deferred retirement payments.
Will TRS provide me with documentation confirming my retirement?
There are three occasions on which you will receive such a confirmation:
- When you submit your retirement application, either in person or by mail, you will receive a receipt.
- Shortly after TRS initiates the benefits process, you will receive an advisement letter which indicates information such as your effective retirement date, type of retirement you filed, and form of payment chosen.
- Shortly after you receive your first retirement allowance payment, you will receive a Benefits Letter. This document indicates your monthly and annual retirement allowance, payment option chosen, Final Average Salary, total years of service, and initial reserves.
If you have not yet received your first retirement payment, and you need confirmation of your retirement to obtain a mortgage or to begin health insurance, you may submit a written request for a pension verification letter. You may also request such a letter in person at TRS.
When will my employer be notified of my retirement?
When a TRS retirement examiner begins to process your retirement application, two copies of the Notice of Prospective Retirement are generated. One is sent to you. The other notice is sent to your school or college, stating that you have filed a retirement application and indicating your prospective retirement date. You should give a copy of the Notice of Prospective Retirement to your payroll secretary or benefits officer for health insurance purposes. If you are a Department of Education employee, the Department of Education and your union are also notified via a computer file that is generated monthly.
How long will it take to process my retirement application?
It generally takes about three to five months to process a retirement application. If your application has not been processed within our normal processing time, TRS will begin to issue advance payments to you. Factors that may impact the amount of time needed to process an application include the following:
- the timely transfer of information, such as salary and service verification, from other agencies;
- the calculation of any service purchase;
- the verification of any loans and excess withdrawals
Can I change my beneficiary designations after retirement?
The answer depends on which retirement option you elected. For certain options, the age of the member's beneficiary is a factor in calculating a retirement allowance; as a result, the beneficiary cannot be changed after the retirement date has passed. However, for the following options, you can change your beneficiary(ies) after retirement:
- For Tier I and II members—Options I, IV-b, IV-d, and IV-e;
- For Tier III, IV, and VI members—Options 3 and 4
After retirement, you may also change your fractional beneficiary and your Death Benefit #2 beneficiary, if applicable.
Will my retirement benefits be offset by Social Security?
Only members who retire under Tier III are affected by this law. Upon reaching age 62, the retirement allowances for Tier III retirees are reduced by 50% of the Social Security benefit they accrued while they were in public employment with New York State or its political subdivisions such as New York City. If your payments commence after you reach age 62, the reduction takes effect on the date your payments commence.
Can someone file my retirement application on my behalf?
Your retirement application may be submitted by another individual; however, you must complete and sign the application yourself. Please note that your signature must be notarized. When you have granted Power of Attorney to another individual, that individual may sign on your behalf and receive benefit information concerning your retirement.
What happens if I do not meet my minimum accumulation?
Tier I and II members who do not meet the minimum accumulation may not be eligible to receive their full retirement benefit. In addition, they would not be eligible to elect a zero rate of contributions or to make an excess withdrawal.