- Working for an employer not covered by SDRS does not affect your benefit. To work for an SDRS employer you need three consecutive calendar months of separation starting with your retirement date, with no job, relationship or agreement to return; otherwise the retirement is invalid and benefits must be repaid.Foundation Handbook (July 2024), p. 14; SDCL 3-12C-1400, 3-12C-1406
- If you were at least 59 1/2 when benefits began and work under 1,250 hours in the employer's fiscal year, you do not need the separation. Under 1,250 hours your benefit is unaffected. At 1,250 hours or more your benefit is cut 15% and COLAs stop while you work (or the benefit is suspended if you skipped the separation under the 59 1/2 exception).Foundation Handbook (July 2024), p. 14; SDCL 3-12C-1401.1, 3-12C-1405, 3-12C-1405.1
Work for a non-SDRS employer does not affect your benefit. To work for an SDRS employer you need three consecutive calendar months of separation starting with your retirement effective date, with no employment, relationship or agreement to return; otherwise the retirement is invalid and all benefits must be repaid. If you were at least 59 1/2 when benefits began and work under 1,250 hours in the employer's fiscal year, no separation is needed. Working under 1,250 hours (after the separation) leaves the benefit alone. Working 1,250 hours or more cuts the benefit 15% and stops COLAs during reemployment (member contributions go to an SDRS-SRP account); for someone who skipped the separation under the 59 1/2 exception, the benefit is suspended instead. Foundation Handbook (July 2024), p. 14, Returning to Work After Retirement; Generational Handbook (July 2024), p. 13; SDCL 3-12C-1400, 3-12C-1401, 3-12C-1401.1, 3-12C-1405, 3-12C-1405.1, 3-12C-1406
The no-COLA rule while you work is explained with the SDRS COLA; the benefit itself comes from the formula.
Examples
Each example retires on July 1, 2026 with $2,000 a month. The 3-month break runs to October 1, 2026.
| Situation | What happens | Monthly while working |
|---|---|---|
| Retired at 58, back at an SDRS school on Sept. 15 (inside the 3 months) | Retirement invalid: benefits must be repaid | repay |
| Retired at 58, back on Oct. 1, under 1,250 hours | No change to your benefit | $2,000 |
| Retired at 58, back on Oct. 1, full time (1,250 hours or more) | Benefit cut 15% and no COLA while you workno COLA while working | $1,700 |
| Retired at 60, back in August, under 1,250 hours | No change to your benefit | $2,000 |
| Retired at 60, back in August, 1,250 hours or more | Benefit suspended while you workno COLA while working | $0 |
| Retired at 58, working for a private school or other non-SDRS employer | No change to your benefit | $2,000 |
State law counts your birthday as the first of your birth month for eligibility. The sources don't say whether that also applies to the age 59 1/2 rule for going back to work; we assume it does.
What would settle it: SDRS guidance on the reemployment exception.
A reemployed retiree earns no additional SDRS benefit for the reemployment period. SDCL 3-12C-1405
SDRS has no DROP. Talk to SDRS before you accept a job with an SDRS employer in your first months of retirement. Check with SDRS
Related: if you're still deciding when to stop, see what one more year adds and early retirement.
Questions
Can I go back to teaching after I retire from SDRS?
Yes. Work for an employer outside SDRS doesn't affect your benefit. For an SDRS employer you need 3 consecutive calendar months off, starting with your retirement date, unless you were at least 59 1/2 when benefits began and work under 1,250 hours a year.
What if I work full time?
Working 1,250 hours or more in the employer's fiscal year cuts your benefit 15% and stops COLAs while you work. If you came back under the age 59 1/2 exception without the 3-month break, the benefit is suspended instead.
Do I earn a bigger pension by going back?
No. A reemployed retiree earns no additional SDRS benefit for the reemployment period.
Source: SDRS Class A Handbooks (Foundation and Generational members), July 2024, Foundation p. 14; Generational p. 13. Also: SDCL §§ 3-12C-702, 3-12C-1400, 3-12C-1401, 3-12C-1401.1, 3-12C-1405, 3-12C-1405.1, 3-12C-1406. Last reviewed .