Leaving Massachusetts teaching: refund or keep it?

• If you leave, you can take a refund, leave your money on account, or retire if eligible. With 10 or more years you can leave it on account and apply at 55 (Tier 1) or 60 (Tier 2).MTRS web page 'Leaving MTRS service prior to retirement'
• Refund interest for members since 1984: only 3% if you resign with fewer than 10 years, the full credited interest with 10+ years or if you were involuntarily terminated, and only two years' interest after you leave if you wait more than two years to apply.MTRS web page 'Leaving MTRS service prior to retirement'

Keeping your account

With at least 10 years of creditable service when you leave, you may leave your funds on account and apply for a retirement allowance at age 55 (Tier 1) or 60 (Tier 2). Tier 1 members with 20 or more years may retire at any age. MTRS web page 'Leaving MTRS service prior to retirement'; M.G.L. c. 32, § 10(1), (2)(b1/2)

Members first employed on or after Jan. 1, 1978 who leave with fewer than 10 years receive a return of their accumulated deductions with interest instead of a superannuation allowance. M.G.L. c. 32, § 5(1)(m)

Taking a refund

If you leave you may take a refund, leave funds on account, or retire if eligible. Taking a refund ends your membership rights (rate, RetirementPlus status and Tier 1 status are not restored by a later buyback; returning members are Tier 2). Interest on a refund for members since Jan. 1, 1984: 3% if you resign voluntarily with fewer than 10 years; the regular credited rate with 10+ years or if involuntarily terminated; only two years of interest after termination if you apply more than two years later. MTRS must refund your account by April 1 after the year you reach required-minimum-distribution age. Refunds are processed within 60 days of a complete application. MTRS web page 'Leaving MTRS service prior to retirement'; MTRS web page 'Contribution rates explained'; Introduction to the MTRS (Spring 2026), p. 8; M.G.L. c. 32, § 11

What it gives up: If you take a refund and later return, you start over as a new member: Tier 2, the current 11% rate and RetirementPlus. Buying back the refunded service does not restore your old membership date, rate or Tier 1 status. MTRS web page 'Contribution rates explained'; Introduction to the MTRS (Spring 2026), p. 8

A refund is your own contributions and interest, not the pension. To compare, try a future retirement date in the calculator (tick "The years above are what I'll have on my retirement date"). See also taxes and buying back service.

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