When you retire, you may purchase additional service credit that would provide you a lifetime increase to your monthly benefit. You may purchase from 1 to 60 months in whole month increments. The purchased additional service credit may not be used to qualify for early retirement or to qualify for the three percent reduction factor instead of the actuarial reduction factor. You must submit the “Request to Purchase Additional Service Credit” form to DRS at the same time you submit your retirement application.
The amount your benefit would increase is determined by the number of months you purchase, your average final compensation (AFC) and an early retirement reduction factor (ERF) if you retire early. The formula used is:
Months of Service Purchased ÷ 12 x 2% x AFC x ERF (if any) = Monthly Increase
The cost to purchase additional service credit is determined by the annuity factor (AF) for your age at retirement and the monthly increase amount. The formula used is:
Monthly Increase ÷ AF = Cost to Purchase
For more information, review the DRS publication Purchasing Additional Service Credit. You may also calculate your own estimate of monthly increase and cost by accessing your account using the Defined Benefit Access application. Once you are in your account, select the Purchasing Service link.