Are you an adjunct who has not yet joined the New York City Teachers’ Retirement System (TRS)? If your answer is yes, then you should join immediately. Every day that you delay joining means that you may have to pay more money later on if you decide to join the pension plan, or if you get a full-time position and want to get pension credit for your adjunct work later on.
Many adjuncts do not realize that they are eligible to join a pension plan, or that it is to their advantage to do so. However, all adjuncts are eligible to join the New York City TRS from their first day of employment, provided that they have an appointment for at least 45 hours. Continuing education teachers who have a six-month appointment and work at least 30 hours per week are also eligible to join TRS.
Adjuncts and continuing education teachers who joined TRS after April 1, 2012, or who will join it in the future, are or will be in the pension system’s Tier 6. This pension tier requires TRS members to contribute a percentage of their pay that is based on annual earnings. TRS Tier 6 members who earn less than $45,000 annually from their teaching contribute 3%. Those who earn between $45,000 and $55,000 contribute 3.5%. Most adjuncts earn less than $45,000, and thus contribute just 3% if they are in Tier 6. Most TRS-eligible continuing education teachers work in either CLIP or CUNY Start and earn between $45,000 and $55,000, so if they are in Tier 6 they contribute 3.5%.
But if Tier 6 members want pension credit for CUNY work done before they signed up as members of TRS, they must pay 6% of their earnings that occurred before their TRS membership became effective, plus 5% interest, compounded annually. (That’s called “buying back” prior service.) The bottom line: for most CUNY adjuncts in Tier 6, buying back past service will cost more than twice as much as getting pension credit for work done while a TRS member.
So joining TRS right away will save you money, while delay will cost you more. The longer you delay becoming a TRS member, the more money you will have to pay to get prior-service credit.
Path to Pension
In Tier 6, TRS members must have the equivalent of 10 years of full-time service to collect a retirement allowance. But even if you leave CUNY employment before you qualify, you will not lose money. If you do not reach the 10-year mark, you will get a refund of your contributions with 5% interest, which is a much higher interest rate than most banks are paying now. If you do reach the 10-year mark, you will qualify for a pension that will be funded by both your contributions and contributions made by CUNY as your employer. If, however, you reach that mark but never sign up to join TRS, you are effectively leaving CUNY’s money on the table.
While many people do not expect to remain CUNY adjuncts long enough for pension eligibility, the future is unpredictable. There is no economic downside to joining TRS – but a delay in signing up can be costly.
Adjuncts, continuing education teachers and full-timers who became TRS members before April 1, 2012, are not in Tier 6. The rules for how much time you need to qualify for a pension and how much you contribute vary according to your pension tier, so the information above about Tier 6 pension eligibility does not apply to TRS members in other tiers.
For more information about TRS membership, contact your campus HR office or Jared Herst, the PSC’s coordinator of pension and welfare benefits. Jared can be reached at email@example.com.