Benefit factor × final average salary (monthly) × years of service = your monthly Single Life benefit
Handbook p. 46, Benefit Formula Components; p. 47, Benefit Formula1. The benefit factor
| You retire with | Factor |
|---|---|
| Normal retirement, under 32 years | 2.5% |
| 32 or more years, any age | 2.55% |
| 25-and-Out (under 55, 25 to 29 years) | 2.2% to 2.4% |
The 2.55% applies to all your years, not just the ones past 32. With a $4,590 monthly average, 31 years pays $3,557.25 at 2.5%, and 32 years pays $3,745.44 at 2.55%. Our example, from the rule above.
Between July 1, 2001 and July 1, 2014 members could retire with a 2.55% factor with 31 or more years; beginning August 28, 2023 the 2.55% factor returned for 32 or more years. ACFR 2025, p. 30, PSRS
The handbook says retirements on or after September 1, 2023; the annual report says August 28, 2023 (when the law took effect).
What we use: September 1, 2023. It only matters for past retirement dates.
Early retirement changes the factor or adds an age factor. See early retirement.
2. Final average salary
Add your three highest consecutive years of salary (including employer-paid health, dental and vision premiums for you) and divide by 36. Handbook p. 46, Final Average Salary
| School year | Salary |
|---|---|
| 2023-2024 | $54,000 |
| 2024-2025 | $55,080 |
| 2025-2026 | $56,181 |
| Total | $165,261 |
| ÷ 36 months | $4,590.58 |
PSRS's example shows this as $4,590 (it drops the cents). Handbook p. 46, Final Average Salary, Example
The salary cap
PSRS caps salary increases during the FAS period to prevent spiking. Extra duties, overloads, additional courses and career ladder pay can cause a cap; genuine changes of position or employer, increases required by state statute, and district-wide schedule adjustments for previously unrecognized education-related service are exempt. Handbook p. 47, Final Average Salary Cap
| School years | Largest raise counted |
|---|---|
| 1997-1998 to 2006-2007 | 20% |
| 2007-2008 | 12% |
| 2008-2009 and later | 10% |
PSRS caps raises during your Final Average Salary years (10% a year now), but doesn't spell out exactly which years are compared. Real job or employer changes are exempt.
What we use: the salary you enter. The cap isn't applied to it; if you had a big raise late in your career, ask PSRS.
3. Years of service
A full year of service for each school year (July 1-June 30) of full-time covered work if you work the complete term and earn at least 95% of your full-time Annual Base Salary. Service = salary earned / full-time Annual Base Salary, to five decimal places; at most one year per school year. Handbook pp. 22-23, Earned Service (Examples 1-2)
You can add service by buying or reinstating it. See buying service credit.
Putting it together
Years at the two-thirds rate
If part of your service was in a job also covered by Social Security, you paid two-thirds of the normal rate and those years count at two-thirds. Handbook pp. 47-48, Members Contributing at Two-Thirds the Full Contribution Rate
| 25 full years: 2.5% × $4,590 × 25 | $2,869 |
| 5 two-thirds years: 2.5% × $4,590 × 5 × 2/3 | $383 |
| Monthly benefit | $3,252 |
PSRS rounds each line before adding. Unrounded, the total is $3,251.25. Handbook p. 48, Example (25 full + 5 two-thirds years)
Minimum and maximum
| Service | Minimum Single Life benefit |
|---|---|
| 15 to under 20 years | $600 a month |
| 20 to under 25 years | $800 a month |
| 25 to under 30 years | $1,000 a month |
| 30 or more years | $1,200 a month |
Minimum Single Life monthly benefits. For 15-24.99999 years the minimum is reduced for a Joint-and-Survivor or Term-Certain plan and/or an age-reduction factor. For 25+ years it is reduced only for a Joint-and-Survivor or Term-Certain plan; if an age reduction would push the benefit below the minimum, the minimum is paid. Handbook p. 56, Minimum and Maximum Monthly Benefits
Your benefit can't be more than 100% of your final average salary. Handbook p. 56, Minimum and Maximum Monthly Benefits; RSMo 169.070.1
The handbook says the minimum benefit for 15 to 24.99 years is 'reduced' for an age-reduced retirement, but not by how much.
What we use: the minimum times the same age-reduction factor. With 25 or more years the full minimum is paid.
PSRS's examples sometimes round to the nearest dollar and sometimes drop the cents. Its actual rounding isn't stated.
What we use: cents. PSRS's figure may differ by up to $1.
What the handbook says
- Your Single Life monthly benefit = benefit factor x Final Average Salary (monthly) x years of service.Handbook p. 46, Benefit Formula Components
- Example from PSRS: at 60 with 28 years and a $4,590 monthly average salary, 2.5% x $4,590 x 28 = $3,213 a month.Handbook p. 47, Benefit Formula
- Your benefit can't be more than 100% of your Final Average Salary.Handbook p. 56, Minimum and Maximum Monthly Benefits
- Missouri law sets minimum Single Life benefits: $600 a month with 15-19.99 years, $800 with 20-24.99, $1,000 with 25-29.99 and $1,200 with 30 or more.Handbook p. 56, Minimum and Maximum Monthly Benefits
- Years in a position covered by Social Security count at two-thirds of the normal formula, because you paid two-thirds of the PSRS rate for them.Handbook pp. 47-48, Members Contributing at Two-Thirds the Full Contribution Rate
- Service is your salary earned divided by the full-time salary for the job, up to one year per school year. Earning $31,500 of a $40,000 salary gives 0.78750 of a year.Handbook pp. 22-23, Earned Service
- Your Final Average Salary is your three highest consecutive years of salary added together and divided by 36. Salary includes employer-paid health, dental and vision premiums for you.Handbook p. 46, Final Average Salary
- PSRS caps raises during your three Final Average Salary years to stop spiking: 10% a year for 2008-2009 and later. Extra duties or overloads can trigger the cap; a real change of position or employer doesn't.Handbook p. 47, Final Average Salary Cap
- If you joined PSRS on or after July 1, 1996, IRS rules limit the salary that counts. The limit is $360,000 for 2026-2027.Handbook p. 24, Retirement Contributions
Questions
What is the PSRS formula?
Benefit factor × final average salary × years of service. The factor is 2.5% for most people and 2.55% with 32 or more years.
What counts as salary?
All your pay from PSRS-covered work, including extra duties, overtime and career ladder pay, plus health, dental and vision premiums your employer pays for you.
Is there a minimum benefit?
Yes, with 15 or more years: from $600 to $1,200 a month, depending on your service.
Source: PSRS Member Handbook, 2026-2027 (as of September 2026), pp. 9, 22, 23, 24, 46, 47, 48, 56; ACFR 2025 p. 30; RSMo 169.070. Last reviewed .