Your vesting years depend on your tier. A deferred pension uses the same formula and early-retirement rules as everyone else, and if you come back after a refund you can buy the service back.
What goes into your account
Members pay 11.75% of salary and employers 12.75%. On a $60,000 salary, that's $7,050 a year from you. Handbook p. 1, About TFFR; p. 7, Employer Contributions, Employee Contributions; p. 43, Contributions; NDCC 15-39.1-09(1)
Member contributions earn 6% a year, compounded monthly (0.5% a month). Employer contributions are not refundable. For example, $100 a month for 12 months grows to $1,233.56. Handbook p. 7, Interest; Employer Contributions; NDCC 15-39.1-04(6)
If you're vested: a deferred pension
Vesting takes 3 years of service in Tier 1 and 5 years in Tier 2. Handbook p. 13, Vesting; p. 4, Dual Membership; p. 14, Eligibility item 4; NDCC 15-39.1-11; 15-39.1-10.3(1)(a)
A vested member who leaves may defer the benefit until eligible, and keeps the right to receive it retroactive to initial eligibility (no interest on back benefits). Deferred members must apply on an official form. Handbook p. 18, Deferred Retirement; NDAC 82-05-02-04; NDAC 82-05-05-01
NDCC 15-39.1-11 says a member who has 'attained normal retirement age' has a vested right; the handbook and valuation require 3 (Tier 1) or 5 (Tier 2) years even at 65.
What we do: 3/5 years required at every age (handbook p. 13; valuation p. 36)
What would settle it: RIO confirmation for a Tier 2 member who reaches 65 with fewer than 5 years.A refund
A member who leaves covered employment can take a refund of member contributions plus 6% interest after a 120-day statutory waiting period, which can be waived with proof of resignation, employer acceptance, an employer certification of employment, and proof of non-covered employment or a permanent move out of state (or a medical statement). A refund closes the account and forfeits all service; a Tier 1 member who returns comes back as Tier 2 even after repurchasing. Refunds are paid on the first working day of the month; applications must arrive 10 working days before the end of the previous month. 20% federal withholding applies unless rolled over; a 10% early-distribution penalty may apply if you leave before 55 and are paid before 59 1/2. Handbook pp. 38-39, Refund aka Lump Sum Distribution, Waiting Period, Taxation; NDCC 15-39.1-20; 15-39.1-15
The handbook counts the 120 days 'from the last month of TFFR employment'; NDCC 15-39.1-20 counts from when the member ceases to be eligible to participate.
What we do: 120 days after the last day of covered employment
What would settle it: RIO refund application instructions or the Special Tax Notice page.From the sources
- Tier 1 members vest after 3 years of North Dakota service credit; Tier 2 members after 5. Once vested you can get a monthly benefit: unreduced at normal retirement, or reduced from age 55.Handbook p. 13, Vesting; NDCC 15-39.1-11
- If you leave, you can take a refund of your member contributions plus 6% interest (compounded monthly). Employer contributions are not refunded. There is a 120-day wait unless you send waiver documents.Handbook p. 7, pp. 38-39; NDCC 15-39.1-20
- A refund closes your account and gives up all service credit and any lifetime benefit. If you are vested, you can instead leave the money in and draw a deferred benefit later, retroactive to when you first became eligible.Handbook p. 18, Deferred Retirement; p. 38; NDAC 82-05-02-04
- A refund paid to you has 20% federal tax withheld from the taxable part; a direct rollover avoids it. If you leave before 55 and are paid before 59 1/2, a 10% IRS penalty may apply.Handbook p. 39, Taxation
- Members pay 11.75% of salary and employers 12.75%. Both drop to 7.75% the July 1 after TFFR is first shown to be 100% funded.Handbook p. 7; NDCC 15-39.1-09(1); Fast Facts (FY2025) p. 2
Questions
What happens to my TFFR money if I leave teaching?
If you're vested, you can leave it in and draw a pension later, or take a refund. If you're not vested, a refund of your contributions plus interest is all you can get.
How long until I can get a refund?
There's a 120-day wait after you leave, unless you send the waiver documents.
Do I get the employer's contributions?
No. A refund is your own contributions plus interest. Employer contributions are not refundable.
If I come back later, am I still Tier 1?
Not if you took a refund. A Tier 1 member who takes a refund and returns comes back as Tier 2, even after buying the service back.
Source: Teachers' Fund for Retirement Member Handbook, 5/7/2026, pp. 1, 4, 7, 13, 14, 18, 38-39, 43. Also: Fast Facts (FY2025); NDCC 15-39.1-04, 15-39.1-09, 15-39.1-11, 15-39.1-20; NDAC 82-05-02-04, 82-05-05-01. Last reviewed .