SURS Actuarial Assumptions and Benefit Provisions
Used in Tier I Plan Choice Comparison

Comparison using 4% annuitization interest rate for lump sums for Portable and RSP Plans.

This section covers the tables and explanation for a 4.0% rate. Click here to skip to the section for the 5.0% rate.

Tier I – Traditional Plan Tier I – Portable Plan RSP*
Defined Benefit (DB) Plan
Benefit Multiplier 2.20% 2.20% NA
Final Average Period 4 Years 4 Years NA
Maximum Benefit 80% of FAC 80% of FAC NA
Employee Contribution 8.00% 8.00% NA
Interest Crediting Rate – Pre-retirement/Termination 4.50% 6.50% NA
Annuitization Interest Rate for Lump Sums 4.00% 4.00% NA
Defined Contribution Plan
Employee Contribution NA NA 8.00%
Employer Contribution** NA NA 7.60%
Assumed Return – Pre-retirement/Termination NA NA 6.00%
Annuitization Interest Rate for Lump Sums NA NA 4.00%
Mortality Assumption Same as Valuation, unisex mortality 45%/55% male/female, year of birth for generational mortality based on age in 2022
Benefit Commencement Age* 30 Years, 60/8, 62/5 30 Years, 60/8, 62/5 30 Years, 60/8, 62/5
COLA 3.000% Same as Traditional Plan when converting lump sums in the RSP to a monthly benefit for the purpose of comparing to the Traditional Plan benefit.
Joint and Survivor Percentage 50.00%
Survivor Age Same as member
Pay Cap Assumptions
Member Pay Increase Assumption Same as Valuation – 12.75% in first year (12.00% if age 50+) graded down to 3.50% at 34 YOS (3.00% if age 50+)
FY 2023 Pay Cap $305,000 $305,000 $305,000
Pay Cap Increase Assumption 3.000% 3.000% 3.000%

*Benefits are assumed to begin at the later of the assumed benefit commencement age and age at termination/retirement.

**0.00% of pay from 7.60% RSP employer contribution used to fund disability benefits.

Because of the higher assumed interest crediting rate/rate of investment return, the Portable Plan (lump sum) is projected to provide a higher benefit than the RSP for members whose pay is under the pay cap. Members must elect an annuity in order to receive retiree healthcare. If an annuity is elected from the Portable Plan, the Traditional Plan and the Portable Plan will provide the same benefit amount. However, the Traditional Plan will provide a 50% J&S benefit for married participants and a refund of survivor contributions for unmarried participants. In most cases, the RSP is projected to provide higher benefits to Tier 2 members whose pay is higher than the Tier 2 pay cap.

If the Portable Plan is shown as the highest benefit, this assumes a Portable lump sum is taken and annuitized outside of the Plan (based on the assumptions shown, which are the same assumptions used for annuitization of the RSP balance). RSP members may annuitize with a SURS provider which will entitle them to retiree healthcare, whereas a Portable Plan member may not annuitize with a SURS provider and receive retiree healthcare. The value of retiree healthcare is not included in this analysis.

Comparison using 5% annuitization interest rate for lump sums for Portable and RSP Plans.

This section covers the tables and explanation for a 5.0% rate. Click here to skip back to the section for the 4.0% rate.

Tier I – Traditional Plan Tier I – Portable Plan RSP*
Defined Benefit (DB) Plan
Benefit Multiplier 2.20% 2.20% NA
Final Average Period 4 Years 4 Years NA
Maximum Benefit 80% of FAC 80% of FAC NA
Employee Contribution 8.00% 8.00% NA
Interest Crediting Rate – Pre-retirement/Termination 4.50% 6.50% NA
Annuitization Interest Rate for Lump Sums 5.00% 5.00% NA
Defined Contribution Plan
Employee Contribution NA NA 8.00%
Employer Contribution** NA NA 7.60%
Assumed Return – Pre-retirement/Termination NA NA 6.00%
Annuitization Interest Rate for Lump Sums NA NA 5.00%
Mortality Assumption Same as Valuation, unisex mortality 45%/55% male/female, year of birth for generational mortality based on age in 2022
Benefit Commencement Age* 30 Years, 60/8, 62/5 30 Years, 60/8, 62/5 30 Years, 60/8, 62/5
COLA 3.000% Same as Traditional Plan when converting lump sums in the RSP to a monthly benefit for the purpose of comparing to the Traditional Plan benefit.
Joint and Survivor Percentage 50.00%
Survivor Age Same as member
Pay Cap Assumptions
Member Pay Increase Assumption Same as Valuation – 12.75% in first year (12.00% if age 50+) graded down to 3.50% at 34 YOS (3.00% if age 50+)
FY 2023 Pay Cap $305,000 $305,000 $305,000
Pay Cap Increase Assumption 3.000% 3.000% 3.000%

*Benefits are assumed to begin at the later of the assumed benefit commencement age and age at termination/retirement.

**0.00% of pay from 7.60% RSP employer contribution used to fund disability benefits.

Because of the higher assumed interest crediting rate/rate of investment return, the Portable Plan (lump sum) is projected to provide a higher benefit than the RSP for members whose pay is under the pay cap. Members must elect an annuity in order to receive retiree healthcare. If an annuity is elected from the Portable Plan, the Traditional Plan and the Portable Plan will provide the same benefit amount. However, the Traditional Plan will provide a 50% J&S benefit for married participants and a refund of survivor contributions for unmarried participants. In most cases, the RSP is projected to provide higher benefits to Tier 2 members whose pay is higher than the Tier 2 pay cap.

If the Portable Plan is shown as the highest benefit, this assumes a Portable lump sum is taken and annuitized outside of the Plan (based on the assumptions shown, which are the same assumptions used for annuitization of the RSP balance). RSP members may annuitize with a SURS provider which will entitle them to retiree healthcare, whereas a Portable Plan member may not annuitize with a SURS provider and receive retiree healthcare. The value of retiree healthcare is not included in this analysis.