New Jersey PERS Retirement Calculator: How to Use It
New Jersey PERS has five tiers with different accrual rates, FAS windows, and retirement ages. The COLA has been suspended since 2011. Which tier you're in determines almost everything about your benefit.
What this calculator does
The New Jersey PERS Retirement Calculator computes your Public Employees' Retirement System defined benefit pension across all five tiers. It applies the correct accrual rate (1/55th for Tiers 1 and 2, 1/60th for Tiers 3 through 5), the correct FAS window (3 years for Tier 1, 5 years for Tiers 2 through 5), and the retirement eligibility thresholds specific to each tier. Early retirement reductions are applied for eligible members who retire before normal retirement age.
The COLA has been suspended since 2011. The benefit shown is your fixed nominal pension at retirement with no inflation adjustment projected forward. New Jersey PERS members also participate in Social Security, so the pension is one part of your total retirement income.
What each input means
Member tier
Your tier is determined by your PERS enrollment date. Tier 1: enrolled before July 1, 2007. Tier 2: enrolled July 1, 2007 through November 1, 2008. Tier 3: enrolled November 2, 2008 through May 21, 2010. Tier 4: enrolled May 22, 2010 through June 27, 2011. Tier 5: enrolled June 28, 2011 or later. Check your Division of Pensions and Benefits member statement to confirm. Tier 1 has the most favorable formula; Tier 5 has the strictest retirement age requirement and lowest accrual rate.
Current age
Your age today. The calculator uses this to determine whether you meet your tier's normal retirement threshold at your planned retirement date and whether an early retirement reduction applies.
Years of PERS service
Total creditable service with New Jersey PERS. Includes active service in covered positions, purchased service credit for prior New Jersey public employment, military service, and approved leaves. Your annual member statement from the Division of Pensions and Benefits shows your confirmed credited service balance.
Final Average Salary
Enter your FAS based on the correct window for your tier. Tier 1: the average of your three highest consecutive years of pensionable compensation. Tiers 2 through 5: the average of your five highest consecutive years. Pensionable compensation is base salary only. Overtime, bonuses, and lump-sum leave payouts are excluded. For most members near retirement, this is the average of the final three or five years of base pay.
Planned retirement age
The age at which you plan to begin drawing your pension. Tier 1: any age with 25 years, or age 60 with any service. Tier 2: age 62/10+. Tiers 3 and 4: age 62/10+. Tier 5: age 65/10+. Early retirement at 55/10+ is available for some tiers with a permanent reduction.
Understanding the outputs
The pension formula for Tiers 1 and 2 is: (1/55) times years of service times FAS. A Tier 1 member with 28 years and a $75,000 FAS gets (1/55) x 28 x $75,000 = $38,182 per year. The formula for Tiers 3 through 5 is: (1/60) times years of service times FAS. The same member under Tier 5 would get (1/60) x 28 x $75,000 = $35,000 per year, roughly $3,200 less annually for life.
Early retirement reductions for eligible members who retire at 55/10+ before normal retirement age are permanent. The exact reduction depends on how far before normal retirement age you separate. Contact the Division of Pensions and Benefits for the actuarial reduction table applicable to your tier.
The COLA suspension is a material planning issue. A pension fixed in nominal dollars loses purchasing power every year. At 3% average inflation, $38,000 per year in 2026 is worth about $28,000 in today's dollars by 2036. Social Security's built-in COLA becomes proportionally more valuable in this environment. Claiming Social Security at the right time matters more for New Jersey PERS retirees than for members of systems with active COLAs.
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Frequently asked questions
What is the difference between New Jersey PERS Tier 1, 2, 3, 4, and 5?
Tiers 1 and 2 use a 1/55th accrual rate. Tiers 3 through 5 use 1/60th. Tier 1 uses a 3-year FAS; all other tiers use 5 years. Retirement ages get progressively stricter from Tier 1 (most flexible) to Tier 5 (age 65/10+ required).
When can I retire under New Jersey PERS?
Tier 1: any age/25 years or age 60. Tier 2: 62/10+. Tiers 3 and 4: 62/10+. Tier 5: 65/10+. Early retirement at 55/10+ is available for some tiers with a permanent reduction.
How is the Final Average Salary calculated for New Jersey PERS?
Tier 1: average of three highest consecutive years of base salary. Tiers 2 through 5: average of five highest consecutive years. Overtime and bonuses are excluded in all tiers.
Why is the New Jersey PERS COLA suspended?
The COLA was suspended by law in 2011 as part of pension reform. It won't resume until the system reaches a specified funded ratio. As of 2026, the COLA remains suspended for most members. Plan for no inflation adjustment on the pension.
Does New Jersey PERS coordinate with Social Security?
Yes. PERS members pay Social Security taxes and earn Social Security credits. With the PERS COLA suspended, Social Security's automatic annual adjustment is especially important. Find the optimal claiming age to maximize lifetime income.