Not sure which salary average applies? See Tier 1 or Tier 2. To see the formula on your own numbers, open this example in the calculator and change it; early retirement and buying service explain what changes the years and the percentage.
Step 1: your percent
Each year of service is worth 2.2% of your salary average, in both tiers. Tier 2 Guide p. 18, Capping average salary (2.2% x FAS x years); TRS Illinois Tier 2 slides, slide 14, Formula Factor The total stops at 75%. Tier 1 Guide p. 17-18, Annuity calculation; Maximum retirement benefit; Tier 2 Guide p. 18, Maximum retirement benefit
| Years | × 2.2% | You get |
|---|---|---|
| 10 | 22% | 22% |
| 15 | 33% | 33% |
| 20 | 44% | 44% |
| 25 | 55% | 55% |
| 30 | 66% | 66% |
| 34 | 74.8% | 75% |
If you are qualified to receive a benefit of at least 74. Tier 1 Guide p. 18, Maximum retirement benefit That's why 34 years (74.8%) pays the full 75%. Tier 1 Guide p. 18, Maximum retirement benefit; TRS Illinois Tier 2 slides, slide 19 (Tier 2: 34 years = 75%, age 67 and over)
Only the Tier 1 guide says 74.6% rounds up to 75%. But TRS Illinois's Tier 2 slides say 34 years = 75%, which only works with the same round-up.
What we use: We round 74.6% or more up to 75% in both tiers.
Step 2: your final average salary
| Tier 1 | Tier 2 | |
|---|---|---|
| Years averaged | Best 4 in a row of your last 10 Tier 1 Guide p. 17, Average salary | Best 8 in a row of your last 10 Tier 2 Guide p. 18, Average salary |
| Pay cap | None from TRS Illinois (federal limits apply if you joined on or after July 1, 1996) Tier 1 Guide p. 5, Limitations | $129,192.26 for FY27 (July 1, 2026 - June 30, 2027) Tier 2 Guide p. 18, Capping average salary; TRS Illinois Tier 2 slides, slides 15 and 60 |
- If your average includes the 2020-21 school year and you retire on or after June 1, 2021, the years don't have to be in a row. TRS Illinois uses whichever average is higher. Tier 1 Guide p. 17, Average salary; Tier 2 Guide p. 18, Average salary; TRS Illinois Tier 2 slides, slide 65
- With the same employer, a raise of more than 20% over the year before isn't counted above 20%. Tier 1 Guide p. 18, Average salary (20% cap)
- Salary includes regular pay, extra-duty stipends and your 9% TRS Illinois contribution. Severance paid after your last paycheck, fringe benefits and expense payments don't count. TRS Illinois Tier 2 slides, slide 15; Tier 1 Guide pp. 5-6, Ch. 3 Earnings
Tier 2 pay is capped, and the cap rises each year with inflation. We only have the FY27 cap ($129,192.26), not the earlier years' caps.
What we use: We apply the FY27 cap to every year. That can overstate a high earner's average a little.
Tier 1 service before July 1, 1998
Service before July 1, 1998 earns 2.2% only if you paid the "2.2 upgrade." Otherwise those years earn 1.67%, 1.9%, 2.1%, 2.3% on a sliding scale (first 10 years, next 10, next 10, over 30). Tier 1 Guide p. 18, formula for service before July 1, 1998
Example: 30 years with 10 of them before July 1998 earns 66% with the upgrade and 60.7% without it. With an $85,000 average that's $4,505 a year. Our illustration.
The upgrade costs 1% of your highest salary rate in the four school years before you apply, times your pre-July 1998 years (up to 20). For 10 years at $85,000, that's $8,500. The cost goes down by one year's worth for every three years you work after July 1, 1998. Tier 1 Guide p. 18, 2.2 upgrades; p. 19, Refunds or reduction of the 2.2 upgrade cost
If you never paid the 2.2 upgrade, your years before July 1998 use a lower, stepped rate. The guide doesn't say whether those older years fill the first steps of the schedule.
What we use: We treat your pre-July 1998 years as your first years (1.67% for years 1-10, and so on), and later years at 2.2%.
If you do not upgrade and had at least 24 years of service prior to July 1998, you receive 2.2% for each year of service earned after June 1998 up to 30 years and then 2.3% for each year of service over 30. Tier 1 Guide p. 18, special provision (24 years as of July 1, 1998)
Tier 1 members who joined before July 1, 2005 also get an actuarial calculation if it pays more. It mainly helps very long careers, and our calculator doesn't model it. Tier 1 Guide p. 17, Annuity calculation
What the guides say
- Pension = years of service x 2.2% x final average salary. Example: 30 years x 2.2% = 66% of an $85,000 average = $56,100 a year, or $4,675 a month.TRS Illinois Tier 2 slides, slides 9, 14, 17
- The pension cannot be more than 75% of your final average salary. With all-TRS Illinois service, you reach 75% at 34 years.Tier 1 Guide p. 18, Maximum retirement benefit; TRS Illinois Tier 2 slides, slide 19
- Tier 1: if your benefit works out to 74.6% or more, TRS Illinois rounds it up to 75%.Tier 1 Guide p. 18, Maximum retirement benefit
- Tier 1 service before July 1, 1998 earns 2.2% only if you paid the 2.2 upgrade. Otherwise it earns 1.67% for the first 10 years, 1.9% for the next 10, 2.1% for the next 10 and 2.3% after 30.Tier 1 Guide p. 18
- The 2.2 upgrade costs 1% of your highest salary rate in the four school years before you apply, times your pre-July 1998 years (up to 20). The cost shrinks for every three years you work after July 1998 and for each year over 34 at retirement.Tier 1 Guide pp. 18-19, 2.2 upgrades
- Tier 1 members who joined before July 1, 2005 get the higher of the formula or an actuarial calculation. The formula is higher for most people.Tier 1 Guide p. 17, Annuity calculation
- Tier 1: your final average salary is the average of your 4 highest consecutive years of salary in your last 10 years.Tier 1 Guide p. 17, Average salary
- Tier 2: your final average salary is the average of your 8 highest consecutive years in your last 10.Tier 2 Guide p. 18, Average salary
- If the 2020-21 school year is in your average and you retire on or after June 1, 2021, the years do not have to be consecutive. TRS Illinois uses whichever average is higher.Tier 1 Guide p. 17; TRS Illinois Tier 2 slides, slide 65
- Tier 2 pensionable salary is capped. The cap for FY27 is $129,192.26 and rises with the Consumer Price Index. Tier 1 salary has no TRS Illinois cap.Tier 2 Guide p. 18; TRS Illinois Tier 2 slides, slides 15, 60
- With the same employer, a raise of more than 20% over the previous year's rate is not counted above the 20% mark.Tier 1 Guide p. 18
- Salary for the average includes regular pay, extra-duty stipends and your 9% TRS Illinois contribution. Fringe benefits and expense reimbursements do not count.TRS Illinois Tier 2 slides, slide 15; Tier 1 Guide p. 6
Questions
What is the TRS Illinois formula?
Years of service × 2.2% × final average salary. The result can't be more than 75% of your average.
How many years do I need for the maximum?
34 years, if all your service is with TRS Illinois and you qualify for an unreduced pension.
What is the Tier 2 salary cap?
For FY27 (July 2026 to June 2027), $129,192.26. Tier 2 salary above the cap doesn't count toward the average. The cap rises with inflation.
Source: TRS Tier 1 and Tier 2 Member Guides, September 2026, Tier 2 meeting slides 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 65; Tier 2 Guide p. 18; Tier 1 Guide pp. 5, 6, 17, 18, 19. Last reviewed .