Your income in retirement is a joint responsibility between you and TRS. Experts say you will need 80 – 90% of your pre-retirement income to maintain your current standard of living. You could need more or less than that depending on your lifestyle and a number of factors, like taxes or medical bills.
There are three pillars used to describe your retirement savings. A secure retirement would depend on two (or in some cases three) of those pillars – your TRS pension, your personal savings and social security.
1. Pension: TRS Retirement
Your monthly TRS contributions, as well as contributions from the state and your employer, help fund your future TRS retirement. Upon retirement, you would receive a monthly annuity for life. There are no automatic increases to your annuity once you have retired.
Keep in mind, your TRS pension is not automatically adjusted for inflation. Although your pension may be enough to cover your expenses when you first retire, over time, your monthly annuity purchasing power will decrease due to inflation. You’ll need to cover the difference with your personal savings.
2. Personal Savings & Other Assets
Personal savings such as a 403(b), 457, or IRA play an important part in your financial security and can supplement your TRS pension at retirement. It’s never too early to start saving. A little money saved early will earn much more in compound interest than a lot of money saved later.
Contact your financial planner to discuss personal savings options that may be available to you.
3. Social Security (If Applicable)
Approximately 96% of public school employees do not pay into the social security system. This makes it even more important to have personal savings.
If you are currently contributing or have contributed in the past, you may receive a social security benefit. To determine if you are eligible for social security and estimate potential benefits, contact the Social Security Administration.
Remember, a good retirement all comes down to this formula: TRS Pension Plan + Personal Savings = Financially Secure Retirement.
More Info
To learn more about the pillars of your retirement, watch these short videos, part of the TRS Financial Awareness Video Series: Will My TRS Pension Be Enough? and Saving in a Tax-Deferred Plan.
Understanding Your Member Statement
Grab your statement and follow along as we walk through section by section.