Plan 3 has pension and investment withdrawals

Plan 3 has two parts – a pension funded by your employer and an investment account funded by you. These account balances are kept separate and you withdraw them separately in retirement. This separation allows you an important opportunity for flexibility. You can withdraw from both fund sources at the same time in retirement, or you can choose to withdraw from one or the other at different times. Many people choose to withdraw only from their investment contributions and leave the employer-funded pension payments until they reach the full retirement age of 65. You withdraw your pension account funds through DRS and your investment account funds through the DRS record keeper.

When can I withdraw money from Plan 3?

You must be separated from Plan 3-covered employment to withdraw from your account. The rules to withdraw money from your pension or investment accounts are different. You can access your Plan 3 investment contributions any time after you leave DRS-covered employment. To withdraw your employer-funded pension, you must meet minimum age and service year requirements. For more information about the individual requirements to withdraw funds from your pension account, see the Plan 3 guide for PERS, SERS or TRS members.

No. If you submit an investment withdrawal request while you are still employed, the request will be held for up to 180 days until we receive a separation date from your employer. Once you separate, the withdrawal will be processed.


For information about exceptions due to COVID-19, see withdrawals related to the COVID-19 pandemic.


What about loans or borrowing from my Plan 3 account? Per federal regulations, borrowing from your account is not permitted. See loans or borrowing for more information.

No, Plan 3 does not allow for in-service withdrawals, including hardship withdrawals. If you are separated from Plan 3-covered employment, you can withdraw your investment contributions at any time. See the “How long does my withdrawal take?” section below for more information about withdrawal processing timelines.

The pension part of your plan is designed to provide you with a source of income throughout your retirement. For this reason, you cannot withdraw the contributions your employer makes to this part of your plan.

  • If you have at least 20 years of service credit when you leave employment and do not start to receive your pension, it will increase by approximately 3% for each year you delay receiving it up to age 65 (this is called indexing and is exclusively available to Plan 3).
  • If you have at least 10 years of service credit and you're age 65, you can retire with a full benefit.
  • If you have at least five years of service credit, you can retire at age 65 with a full benefit if you earned at least one of your five years of service credit after age 44.


As a Plan 3 member, it is possible to withdraw your contributions and investment earnings from your defined contribution part any time after leaving Plan 3-covered employment. However, if you do withdraw early, you reduce an important source of your retirement income.

How do I withdraw funds from Plan 3?

As we mentioned, Plan 3 has two payout sources and you’ll withdraw from these separately.

Investment withdrawals (your contributions)
You can withdraw these funds online or use a paper form to request a withdrawal. We recommend online withdrawal because it’s faster and easier than a paper form. With online withdrawal, your account information is prefilled for you, you can estimate payments and tax withholdings instantly and add your direct deposit information. You’ll also receive immediate confirmation that your transaction is in progress.

To complete your investment account withdrawal online, log into your online account and select your Plan 3 account.
Under the Quick Access menu, select Request Online Withdrawal.

In some cases, you may be unable to complete your Plan 3 withdrawal online. Or maybe you prefer to complete and mail in a paper form. Either way, we’ve got you covered here.

Plan 3 investment withdrawal forms

Plan 3 Withdrawal – This form covers most Plan 3 withdrawals from your investment contributions. Use it to request withdrawals when you separate from employment or to change your current distribution option if you are already receiving payments. You can also complete this request online.
Plan 3 TAP Annuity Purchase – Use this form to request to purchase the TAP annuity using funds from your Plan 3 investment account contributions. This annuity is exclusively available to Plan 3 members. Read more about DRS annuities.

RMD Change Request – Customers who receive a required minimum distribution (RMD), use this form to request changes to your annual minimum distributions. More about required minimum distributions

More investment withdrawal forms

For the following withdrawal types, you’ll need to call the DRS record keeper to get the form you need. Call 888-327-5596 or log into your Plan 3 account to chat live with a customer service associate. They will help you select the right form for your needs.

Beneficiary Distribution Request – Request a withdrawal from your awarded beneficiary account.

Alternate Payee Withdrawal – Withdraw funds per a Qualified Domestic Relations order.

Hardship withdrawals for Separated Plan 3 customers – If you are experiencing severe financial hardship because of an unforeseeable emergency, you may be eligible to expedite the withdrawal of funds from your WSIB Investment Program contributions. Due to the monthly valuation of these funds, the timeline for processing WSIB payment withdrawals is typically much longer than funds in the Plan 3 Self-Directed Investment program. See “How long does my withdrawal take” below for more information.

Related forms

Direct Deposit: Investment account – Use this form to request or modify the direct deposit information for your DCP, Plan 3 or JRA investment account payments. You can also complete this request online.
Direct Deposit: Pension payments – Use this form to request or modify the direct deposit information for your employer-funded Plan 3 pension account payments. You can also complete this request online.
IRS Form W-4P – Request to have federal income tax withheld from each withdrawal or annuity payment you receive.

Pension benefit (employer contributions)
Your employer contributions are only available to you when you meet the age and service credit requirements for retirement. See your Plan 3 guide to determine your eligibility for a pension retirement: Public employees, Teachers, School employees.

Once you determine you’re eligible for a pension retirement, you can begin the process of retiring through DRS. First you must request an official benefit estimate 3 to 12 months prior to your retirement date. When you’re ready, request your official benefit estimate online or contact 800-547-6657. The estimate takes DRS about 6 to 8 weeks to complete and is necessary to determine your pension amount.

When DRS issues the required estimate to you, you can apply for retirement through DRS. Complete your retirement application online. If you are a member of multiple DRS retirement systems, you can request a paper application. We’ll walk you through the next steps when we issue your official benefit estimate. This retirement planning checklist is also a great resource.

How long does my withdrawal take?

How long will it take to get my first Plan 3 payments? The timing is dependent on a few things. Because Plan 3 has a pension and an investment part, withdrawals from your accounts are separate and have unique timeline factors. The type of withdrawal you choose will also affect your payout timeline. When you complete your request, you’ll receive information specific to your withdrawal type.

Investment withdrawals (your contributions)
The investment portion (defined contribution) you pay into has investment shares with valuation time periods that vary by the investment program you selected. If you’ve already left service and your employer has electronically uploaded your separation date, the following timelines will apply. It could take an additional 30 days beyond the timeframes given below if your employer hasn’t reported your separation to DRS. Plan 3 members have two investment programs to choose from and you can transfer your contributions from one fund to the other. 

  • Self-Directed Investment Program (1 to 31 business days): For lump-sum payments, investment shares are redeemed daily. If your documents are accepted by 1 pm Pacific Time, your payment is issued the next business day. For scheduled payments, investment shares are redeemed between the first and 27th of every month, and payments are issued on the first or 15th of each month.
  • WSIB Investment Program TAP Fund (34 to 70 business days): WSIB investment shares are valued monthly. Payments from the WSIB Investment Program are issued on the second business day of the month following valuation. Under certain emergency conditions, you can expedite the timing of this withdrawal. Contact the record keeper to find out more 888-327-5596.


Pension benefit (employer contributions)
All DRS pension retirements require an official DRS benefit estimate before you can retire. For this reason, we have included the timeline for the estimate as well as the timeline for receiving payments once you submit your application. Please note the DRS official benefit estimate is not the same as the benefit estimator tool you can use any time in your account. However you can definitely request the official benefit estimate using your online account.

  • Request official benefit estimate (6-8 weeks): Before you can receive your pension benefit, you must first request an official benefit estimate from DRS 3 to 12 months prior to your retirement date. When you’re ready, request your estimate online. DRS will complete the estimate within 6 to 8 weeks, then you can apply for retirement. The estimate you receive will include your separation and retirement dates.
  • Submitted application (30-90 days): You won’t receive your retirement pension payment until the month you select for your retirement. Submit your application for retirement 30-90 days before the month you intend to retire. All pension members retire on the first of the month after they’ve separated from their DRS covered employer. Your first pension payment will be distributed on the last business day of your retirement month. DRS distributes pension payments on the last business day of every month.

What are my payment options?

Investment withdrawals (your contributions)
Your Plan 3 investment account offers several options for withdrawals.

  • Receive one-time or regular payments in an amount and frequency you choose
  • Purchase an annuity such as the Plan 3 TAP annuity
  • Roll your Plan 3 contributions into another eligible employer plan

You can also leave your Plan 3 savings invested for as long as you want even if you separate from Plan 3-covered employment. While the timing and amount of your payments are up to you, your investment account does have minimum withdrawals required by the federal government when you reach a certain age. See required minimum distributions.

Pension benefit (employer contributions)
Your Plan 3 pension account payments will be monthly and the amount you receive is based on a set formula. To estimate the monthly payments you’ll receive, use the online benefit estimator or see your Plan 3 guide for PERS, SERS or TRS. DRS distributes pension payments on the last business day of every month.

Investment payment options:
Yes, once you begin receiving payments, you can change your payment amount, tax withholding, frequency of payments and payment date at any time. Make changes through your online investment account or using the paper forms listed in the section above.


Pension payment options:
You cannot change the amount or frequency of the pension payments, but you can change the tax withholding by submitting an IRS form W-4P.

How is my withdrawal taxed?

You will pay federal income tax for withdrawals from both your Plan 3 pension and investment accounts. The withdrawal request you complete will include tax information specific to your withdrawal type. Here is some general information about withdrawals.

Investment withdrawals (your contributions)
If you choose a direct rollover, except for a Roth IRA, you are not taxed until you later take payment out of the traditional IRA or the eligible employer plan. Taxes will continue to be deferred.

The IRS requires a 20% tax withholding on any lump-sum withdrawal or if your installment payment plan is expected to last less than 10 years. This means that if you decide to withdraw $10,000 all at once, you will be sent a check for $8,000. The remaining $2,000 will be sent to the IRS. If your installment payments will last longer, you might decide what you would like withheld by completing a form IRS W-4P.

If you receive a payment before you reach age 59½, and you do not roll over your defined contribution funds, you might have to pay an additional tax equal to 10% of the taxable portion of the payment when you file your taxes. Visit the IRS website for more information. If you complete your investment account withdrawal online, you’ll also receive a real-time estimate of your tax withholding. For tax advice, you should consult an accountant, qualified financial advisor, or the Internal Revenue Service.

Pension benefit (employer contributions)
Your monthly pension payments will have standard income tax deducted. We do not deduct any individual state tax, no matter where you live.

For more information about withdrawing from your Plan 3 investment account, contact the DRS record keeper.

Beneficiary Designation

Members, you can update your beneficiary information from your online retirement account. Select “My Account” in the navigation menu and then “View/Edit” beside “Beneficiary.”

(If you prefer to fill out and mail in a printed form, select this link.)