When you apply for retirement, you will decide how to receive your monthly defined benefit (pension) by choosing a benefit payout option. If you plan to retire next summer, now’s a good time to consider and understand your options, which are binding in most cases:
- Basic Benefit. You receive a monthly lifetime benefit based on your age, total years of VRS service and average final compensation. This benefit does not continue to a survivor after your death.
- Survivor Option. You receive a lower monthly benefit during your lifetime so your survivor can receive a monthly benefit after your death. You can name more than one survivor and choose a percentage of your benefit to go to them. Your benefit amount is then based on that percentage, your age and your survivor’s age at retirement.
NOTE:
You can change the Survivor Option once during your lifetime under certain conditions such as the death of your survivor or a divorce.
- Partial Lump-Sum Option Payment (PLOP). If you work at least one year beyond the date you become eligible for an unreduced benefit, you can choose to receive a one-time PLOP — up to the amount of your annual Basic Benefit. If you work two or three years beyond your unreduced retirement eligibility date, you can elect an amount accordingly — up to two or three times your annual Basic Benefit. The amount available depends on how long you work beyond your eligibility for an unreduced retirement. Be aware that the PLOP reduces your monthly benefit. You can choose this option with the Basic Benefit or Survivor Option.
- Advance Pension Option. You opt to temporarily increase your monthly retirement benefit. The temporary increase begins at retirement and continues until an age you choose, between age 62 and your normal retirement age under Social Security. At the age you select, your retirement benefit permanently reduces.
Explore More VRS Resources
- Use custom tools in myVRS, like the Benefit Estimator, to take a closer look at your benefit payout options and decide which one will suit your needs. You can calculate several retirement scenarios based on the different options. Plug your results into the Retirement Planner to estimate future income needs.
- Before you begin your retirement application, schedule a virtual or in-person appointment with a VRS member counselor to discuss your options. The counseling center, at 6641 W. Broad St. in Henrico County, offers convenient parking and is accessible by major highways and public transportation. Register for the December 15 Benefit Payout Options webinar.
- Hybrid Retirement Plan members also need to consider their defined contribution component distribution options. Additional resources are available on the Hybrid Retirement Plan website.
