Retirement law can be confusing. Sometimes a small misunderstanding can have a big impact on your benefit. That’s why it’s important to correct some common retirement myths. Here are the top five:
Retirement Myth #1
My NYSLRS loan has gone into default, but I’ve already paid taxes on it. That means I no longer need to repay it.
You still need to repay your loan. In fact, it continues to accrue interest until you do. And, if you haven’t paid back your loan by the time you retire, your pension amount will be reduced.
Retirement Myth #2
I am required to contribute toward my retirement. When I do retire, my benefit will be based on what I contributed.
Your required member contributions aren’t a factor in the calculation of your pension. Your pension is based primarily on your service credit and the salary you earn while working for public employers. Your retirement plan and, in most cases, your age at retirement are also factors.
Retirement Myth #3
I can’t collect my pension until I start receiving Social Security.
You can collect your pension as soon as you meet the eligibility requirements of your retirement plan. Most members can retire as early as age 55, though there may be a permanent reduction in your benefit if you retire before full retirement age (62 or 63 depending on your tier). You should check the eligibility requirements for your plan and tier when you’re planning for retirement.
Retirement Myth #4
Only you can decide when it’s time to retire. You must file an Application for Service Retirement (RS6037) to begin collecting your pension benefits.
Retirement Myth #5
I recently applied for retirement by giving my employer the paperwork.