Selecting a Retirement Plan

Selection of a retirement plan is part of your online benefits enrollment through Workday.

Full-Time Faculty and Staff: You have 31 days from the effective date of your appointment to choose your retirement plan. If you do not make your decision within that time period, state regulations require that you automatically be enrolled in SERS. Once you are enrolled in a retirement plan, the enrollment is irrevocable. However, you may enroll in a TIAA supplemental retirement plan at any time. To assist employees in selecting a retirement plan, watch this video comparing SERS vs. ARP plans.

Regardless of the plan you choose, you are required to contribute a percentage of your income to the retirement plan. All Penn State retirement plan contributions are tax deferred. The 2026 IRS annual compensation limit for contributions into the mandatory plans is $360,000. This means that no employer or employee contributions will be made into these plans once an employee’s year to date compensation reaches this amount.

Penn State Alternate Retirement Plan (Administered by TIAA)

This is a defined contribution plan. Retirement income is determined by the amount you contribute (5%), the amount contributed by Penn State (9.29%), and the performance of the investments you choose. Therefore, there is no rule of thumb for calculating, far in advance, the amount of TIAA benefit that you might receive at time of retirement.

All questions regarding the Penn State Alternate Retirement Plan should be directed to TIAA at 1-800-842-2252, Mon through Fri, 8 am - 10pm and Sat from 9 am - 6pm.

State Employees Retirement System (SERS)

As a new SERS member, you have the choice of two hybrid defined benefit pension/defined contribution investment plans, referred to as class A-5 and A-6. You will enter SERS in the class A-5 hybrid plan, with the option to choose the other hybrid plan (A-6) or the straight defined contribution plan within you first 45 days of membership. Failure to communicate a selection within 45 days is an affirmative action to remain in the A-5 class of service.

May 5, 2026 Update:

The SERS Board announced in early May a decrease to contribution rates for certain classes. Additional details are available in the official SERS press release, which can be accessed here: SERS May 5, 2026 Press Release.

New member contribution rates will be effective 07/01/2026 for the following:

Class A-3 and A-4 members
A3 – From 6.25% to 5.75%
A4 – From 9.30% to 8.80%

Class A-5 and A-6 members
A5 Defined benefit component – From 5.09% to 5.00%
A6 Defined benefit component– From 4.09% to 4.00%

Class 40/A3
40/A3 – From 6.25% to 5.25%

For further information or questions, members are encouraged to contact SERS directly at 1-800-633-5461 or visit SERS online (www.SERS.pa.gov).

SERS Class Options
	Hybrid (Class A5)	Alternate Hybrid (Class A6)	Defined Contribution
Annual Benefit Accrual Rate	1.25%	1.0%	N/A
Employee Contribution Rate	8.34%	7.59%	7.5%
Other Employee Contribution Rate	Employees beginning employment with Penn State after enrollment with another organization in another SERS Class will be required to contribute to the SERS Class they were previously enrolled in.
DC Employer Contribution Rate	2.25%	2.0%	3.5%
Vesting Years	DB 10/DC 3	DB 10/DC 3	3
Final Average Salary	Highest 5 years	Highest 5 years	N/A
SERS Normal Retirement Age	Age 67/3 years of service; Rule of 97 and 35 eligibility points	Age 67/3 years of service; Rule of 97 and 35 eligibility points	N/A
Early Retirement Milestone	Age 57/25 years of service	Age 62/25 years of service	N/A
Early Retirement Reduction	If reach milestone: 3% reduction for each year under age 67 OR Age 62/10 years of service Actuarial reduction for each year under age 67 OR 10 years of service but NOT age 62 Standard Actuarial reduction from 62-67 plus special 7.375% rate actuarial reduction for each year under 62	If reach milestone: 3% reduction for each year under age 67 OR Age 62/10 years of service Actuarial reduction for each year under age 67 OR 10 years of service but NOT age 62 Standard Actuarial reduction from 62-67 plus special 7.375% rate actuarial reduction for each year under 62	N/A

Please Note: Members of University Police are exempt from the classes described above. SERS options available to these employees are as follows:

SERS options for University Police
	Class A3	Option Class A4 Selected Within 45 Days of SERS Membership
Employee Contribution Rate	6.25%	9.3%
Employer Contribution Rate	Varies - determined by state legislature	Varies - determined by state legislature
Vesting	10 years	10 years
Benefit Formula	2% years of service X average earning for 3 highest years	2.5% X years of service X average earnings for 3 highest years
SERS Normal Retirement Age	Full retirement income at age 65 with at least 3 years of credited service, or your age plus years of credited service equal 92 or higher	Full retirement income at age 65 with at least 3 years of credited service, or your age plus years of credited service equal 92 or higher
Disability Benefit	Earned after 5 years of service	Earned after 5 years of service

Beneficiary Designation Form