Purchasing an Annuity - LEOFF and WSPRS

For members of the Law Enforcement Officers' and Fire Fighters' (LEOFF) and Washington State Patrol Retirement System (WSPRS)

Last Updated June 2016 Print Version

When you retire, you can supplement your monthly benefit by making a one-time, lump sum payment to purchase an annuity. The annuity must be purchased by rolling over funds from an eligible governmental plan, such as the state’s Deferred Compensation Program (DCP). The minimum rollover amount is $25,000.

Why would I want to purchase an annuity?

Purchasing an annuity increases your monthly benefit for the rest of your life. An "annuity" is an investment on which you receive fixed payments for your lifetime. If you purchase one, you will continue to receive the annuity portion of your monthly benefit even if you return to work, or return to membership. If you are eligible for an annual Cost-of-Living Adjustment (COLA) on your monthly benefit, you will receive the same COLA percentage on your purchased annuity.

What happens to my annuity upon my death?

Similar to your monthly benefit payment, the annuity portion may also be passed along to a survivor if you select a survivor option at the time you retire, except for LEOFF Plan 1 members and members of WSPRS Plan 1 who selected survivor Option A. For these members, this annuity will be paid for the member’s lifetime only. 
If you do not select a survivor option, or if you are a LEOFF Plan 1 member, or a WSPRS Plan 1 member who selected survivor Option A, at the time of your death any remaining portion of the original amount you paid for your annuity, less any payments you have received, will be paid to your designated beneficiary or your estate.

Can I purchase an annuity if I'm not an active member?

If you are inactive and eligible for retirement, you can buy an annuity when you submit your retirement application.

How is the annuity paid?

The annuity you purchase is a guaranteed lifetime payment that will be paid to you monthly. You will receive one payment each month from DRS. The payment will include the combined value of your monthly benefit and the purchased annuity amount.

Your annuity will be determined by an actuarial factor that will be based on your retirement date or the date your retirement application is submitted to DRS, whichever is later.

How can I determine the amount my monthly benefit will increase?

An online calculator is available to help you estimate how much purchasing an annuity may increase your monthly benefit. To access the calculator, log in to your retirement account.

How do I purchase an annuity?

To purchase an annuity, contact DRS for a copy of the Request to Purchase an Annuity form for LEOFF and WSPRS. Or, if you are applying for retirement online, you may request an annuity purchase through that application.

Once DRS receives this completed form, or your annuity purchase request through the online retirement application, a bill will be sent to you. To pay for the annuity, you must rollover funds totaling at least $25,000 from an eligible governmental plan, such as DCP.

When will the increase in my monthly benefit take place?

Your annuity will be effective the day after DRS receives your payment or on your retirement date, whichever is later. The two examples below describe how this would work for a retiree who has purchased an annuity that will increase his or her monthly benefit by $450 and will be retiring effective July 1.

Example 1

Payment received before retirement date

If DRS receives payment for the annuity purchase before July 1, the retiree will receive $450 in addition to his or her regular monthly benefit amount on his or her first retirement payment, which will arrive on the last working day of July.

Example 2

Payment received after retirement date

If DRS receives payment after July 1, the first payment will be prorated for that month. For example, if DRS receives the payment for the annuity on Sept. 15, the retiree will receive an annuity payment of $225 with his or her monthly benefit on the last day of September. Every month from that point forward, he or she will receive $450 each month from the annuity. 

For more information about purchasing this annuity, contact DRS.

The actual provisions governing the purchase of an annuity are contained in the Revised Code of Washington (RCW) pertaining to each specific retirement system. This brochure is a summary of those provisions, not a complete description of the law, and describes provisions currently in effect. If there are any conflicts between what is written in this brochure and what is contained in the law the applicable law will govern.