How The California State Teacher Retirement System (CalSTRS) Works

How The California State Teacher Retirement System (CalSTRS) Works

Let’s take a few minutes to learn how State Teacher Pensions work in California! 

Because as a teacher, you work hard for your pension. It’s time to learn how your pension works for you! 

Teachers’ are an asset to any community, and their States fund their retirement and pension plans. It ensures that teachers can secure their dream retirement goals by tapping into this additional source of retirement income.

California offers State Pensions for Teachers, but pensions are complicated to understand, and we get it. This article will discuss every aspect of the California State Teacher Retirement System (CalSTRS). 

To dive EVEN DEEPER into your state teacher pension… Enter the date you want to retire, and National Educational Services will send you a complete projection of your benefits. 

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We recommend reading “Do All Teachers Get Pensions?” after this article.

Requirements To Qualify For California State Teacher Pensions

All educators or educational staff employed in California schools can become members of the California State Teachers Retirement System if they meet specific requirements. 

California State Teachers Retirement began in 1913, and the basic structure of the California Teacher Pension Plan is a defined benefit (DB) Pension. Learn more about DB Pensions HERE.

To be eligible for CalSTRS, you should meet the following requirements:

  1. Be at least 50 years of age with 30 years of service in the respective field.
  2. Be at least 55 years of age with five years of service in the respective field.

Like other major states, teachers in California must have a certain number of years worked to qualify for their pension. According to the CalSTRS, only 1 out of 5 teachers stick around long enough to be eligible for retirement.

The state teacher pension fund consists of teachers who contribute 8% of their monthly salaries. Along with that, staff or employees contribute around 8.25% of funds. Lastly, the state of California pays up to 2% of the fund.

To learn more about your California pension, fill out the form below with your desired retirement date. We’ll send you a complete projection of your benefits so that you can plan for the retirement of your dreams.

Make The Most Of Your State Teacher Pension 

Let’s look at three examples of teachers who abandoned their State Teacher Pension and what happened. It can help you make the most of your current CalSTRS Pension Plan:

Example #1: Leaving Education to Switch Careers

An individual has been given 10 years of teaching services in California to qualify for the pension. However, after 9 years, he/she left the service and got into another career. Now, the contributions will be refunded with a nominal rate of interest.

Example #2: Inflation Could Eat Away Your Pension

An individual has given 15 years of teaching service to qualify for the state pension. But after 15 years he/she left the job. The eligible time will count towards the pension, but when he/she prepares to withdraw the pension, the inflation level could erode its value. Therefore the pension could be less valuable than before inflation.

Example #3: Moving Across State Lines With Existing Pension

Now, consider an individual who worked for 35 years as an educator. But, he/she has to shift to another state. Unfortunately, it is a standard rule that pension portals don’t cross beyond state lines. So, he/she will end up with meager pensions.

The good news is that you can learn how long your pension will last you in retirement by filling out the form below. 

National Educational Services will email you a complete projection of your State Teacher Pension benefits based on your projected Teacher Retirement Date. 

Get a FREE State Teacher Pension Projection Below!

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