New Jersey State Retirement Benefits

New Jersey State Employees' retirement benefits are handled through the New Jersey Public Employees Retirement System (PERS). This retirement system encompasses all state, county, municipal and school board employees. There are several benefits set up for these employees to help them collect credits toward retirement and even use their money before retirement.

Vesting

• After receiving 10 years of service credits under PERS, you are considered fully vested and eligible for retirement benefits. The retirement age is between 60 and 62, depending on the type of state job you held. If you terminate employment with the state and return within a two-year period, you can transfer the prior credits earned to your new job. If you have been away for more than two years, your credits start over.

Loans

• PERS employees have the capability to borrow against their retirement contributions. This allows employees to use some of their retirement money for their present needs at a fixed interest rate. You must be a PERS employee for three years or more to qualify for a loan. The minimum loan amount is $50 and the maximum amount is up to half of the amount posted in your retirement account, but no more than $50,000. The loan must be paid back within five years and you can take out up to two loans per year.

Collecting Your Pension

• Of course the point of PERS is to provide state employees with secure income when they retire. During their years of service with the state, they have payroll deductions taken from paychecks to pay toward the pension. Once they reach retirement age, PERS applies a formula to determine the amount a person will get. They determine this by taking the number of years of service, dividing it by the appropriate retirement age and then multiplying that figure by the final average salary. For instance, if you worked 20 years and the retirement age for your job is 55, you would divide 20 by 55 to come up with 0.36. If your average final salary is $50,000, you would multiply that by 0.36 to get the maximum annual allowance of $18,000. PERS also provides periodic cost-of-living increases for its retirees.