TMRS Calculator

Start by entering your timeline in the "Personal Details" section: your current age and your planned retirement age. These inputs help determine your total years of service and when you'll be eligible for benefits.

Next, provide your "TMRS Plan Details." Enter your average salary from your highest-paid 60 consecutive months of service. Add your current years of service. Then, input your city's matching ratio and your employee deposit rate. You can find your city's specific match and deposit rate on your TMRS statement or by contacting your city's HR department. These are critical inputs, as a higher city match significantly increases your final pension.

For a more detailed projection, open the "Advanced Settings." Here you can add any "Updated Service Credit" (USC) increase your city may have adopted, which boosts your account balance. You can also model future salary growth, a cost-of-living adjustment (COLA) rate if your city offers one, and your expected Social Security benefit. Adding these details provides a more comprehensive view of your total retirement income and its purchasing power over time.

Current Age and Planned Retirement Age

Your current age and planned retirement age determine your remaining years of service. This, combined with your existing service, is used to calculate your total service credit at retirement. These numbers are also used to check your eligibility for unreduced benefits under the TMRS "Rule of 78" (or Rule of 80 in some cities), where your age plus years of service must meet a specific threshold.

Average Salary (Highest 60 Months)

This is your average annual salary during your highest-paid 60 consecutive months of TMRS-credited service. TMRS uses this figure in some calculations, particularly for determining the value of Updated Service Credits. It also serves as a benchmark for calculating your income replacement rate. Use your best estimate if you are far from retirement.

Years of Service

This is the total number of years you have earned service credit in the TMRS system. You must have at least 5 years of service to be "vested," meaning you have a non-forfeitable right to a retirement benefit. More years of service means more deposits, a larger city match, and a higher final pension.

City Matching Ratio

This is one of the most important inputs. Each participating city chooses a matching ratio—commonly 1:1, 1.5:1, or 2:1. This ratio determines how much the city contributes to your account for every dollar you deposit. A 2:1 match means your city contributes two dollars for every one dollar you contribute, dramatically increasing your retirement benefit.

Employee Deposit Rate

This is the percentage of your gross pay that you contribute to TMRS from each paycheck. Participating cities choose a rate of 5%, 6%, or 7%. A higher deposit rate leads to a larger account balance and, consequently, a larger monthly pension. Most TMRS cities have adopted the 7% rate.

Updated Service Credit (USC) Increase

This advanced input accounts for benefit enhancements your city may adopt. USCs increase your account balance to better reflect your current salary, preventing your benefit from being diluted by inflation over a long career. If your city has adopted USCs, enter the percentage increase here. Check your TMRS annual statement or with HR to see if this applies to you.

Annual Salary Growth

This is your expected average annual pay raise. The calculator uses this to project your future salary and, therefore, your future employee deposits. A reasonable estimate is 2-4% per year.

Life Expectancy

This determines the length of your retirement period for projecting the total lifetime value of your pension. A longer life expectancy means your pension annuity will pay out for more years, increasing its total value.

COLA Rate

Some cities may periodically grant a cost-of-living adjustment (COLA) to retiree benefits to help them keep pace with inflation. TMRS COLAs are not automatic; they must be adopted by the city. If your city has a history of granting COLAs, you can enter an estimated annual rate. Otherwise, leave this at 0%.

Social Security Monthly & Start Age

TMRS members also contribute to Social Security. Enter your estimated monthly benefit and the age you plan to start receiving it. This allows the calculator to show a complete picture of your guaranteed income in retirement. Use the Social Security calculator for a detailed estimate.

This calculator simulates the TMRS benefit calculation process to estimate your future pension. Unlike many traditional pensions that use a formula based on final average salary, the TMRS benefit is determined by the total balance in your TMRS account at retirement.

First, the calculator estimates your total employee deposits over your entire career. It approximates your past deposits based on your years of service and average salary, then projects future deposits from your current age to your retirement age, factoring in your estimated salary growth.

Next, it calculates the city's contribution by multiplying your total employee deposits by your city's matching ratio. Your deposits and the city match are added together to determine your total account balance. If you entered an Updated Service Credit (USC) percentage, that is applied to increase the balance further.

At retirement, this total account balance is converted into a lifetime monthly annuity. The calculator uses a standard actuarial annuity factor, which considers your age and life expectancy, to determine your monthly pension payment. A higher account balance results in a higher monthly pension.

The calculator also checks if you meet the "Rule of 78," where your age at retirement plus your total years of service must equal 78 or more to qualify for an unreduced benefit. Finally, it projects your annual income throughout retirement, combining your TMRS pension (with any COLA) and your Social Security benefits.

The TMRS pension calculation is based on converting a final account balance into an annuity. Here are the key formulas used in the projection.

Total Employee Deposits

This is a cumulative calculation over your career. The calculator estimates it as:

total employee deposits = (sum of past salaries x deposit rate) + (sum of future salaries x deposit rate)

City Matching Amount

The city's contribution is based on your total deposits and the city's chosen match ratio.

city matching amount = total employee deposits x city match ratio

Total Account Balance at Retirement

This is the sum of your contributions, the city's match, and any benefit enhancements.

initial account balance = total employee deposits + city matching amount
total account balance = initial account balance x (1 + updated service credit % / 100)

Monthly Pension Annuity

Your account balance is converted into a lifetime monthly income using an annuity factor. The factor is an actuarial value that represents the present cost of providing $1 per month for your expected lifetime.

monthly pension = total account balance / annuity factor

Note: The calculator uses a simplified annuity factor based on standard actuarial tables and an assumed interest rate for the conversion.

Rule of 78

This rule determines your eligibility for an unreduced pension.

rule of 78 sum = retirement age + total years of service
meets rule = (rule of 78 sum >= 78)

The "Rule of 78" is a key eligibility requirement for receiving a full, unreduced retirement benefit from TMRS. To meet the rule, your age at retirement plus your total years of credited service must add up to 78 or more.

For example, an employee who is 58 years old with 20 years of service meets the rule (58 + 20 = 78). They can retire with their full calculated benefit. However, an employee who is 55 with 20 years of service does not (55 + 20 = 75). They would either need to work longer to meet the rule or accept a reduced benefit if they retire early.

Meeting this rule is crucial for maximizing your pension. The calculator automatically checks if your planned retirement age and service years meet this threshold. Some cities have adopted a "Rule of 80" instead, which requires a higher combined age and service. Always confirm your city's specific retirement eligibility rules with your HR department.

The city match is the most powerful feature of the TMRS plan. It acts as a multiplier on your own retirement savings. When you contribute a percentage of your salary (e.g., 7%), your city contributes a corresponding amount based on its chosen matching ratio.

The three common matching ratios are:

• 1:1 (100% match): For every $1 you contribute, the city contributes $1.
• 1.5:1 (150% match): For every $1 you contribute, the city contributes $1.50.
• 2:1 (200% match): For every $1 you contribute, the city contributes $2.

Over a 20 or 30-year career, a higher match makes an enormous difference in your final account balance and resulting pension. An employee in a city with a 2:1 match will have a significantly larger retirement benefit than an employee with the same salary and service in a 1:1 match city. This feature provides a high rate of return on your contributions that is difficult to achieve in other retirement plans like a 401(k) or IRA.

• Monthly Pension: This is the estimated gross monthly income you will receive from TMRS for the rest of your life.
• Replacement Rate: This shows what percentage of your pre-retirement average salary is "replaced" by your annual TMRS pension. Many financial advisors suggest a target of 70-80% replacement from all income sources, including Social Security and personal savings.
• Account Balance: This is the total estimated value of your TMRS account at retirement, showing the power of the city match. You can see how much came from your own deposits versus your city's contributions.
• Lifetime Pension: This is the projected total amount of money you will receive from TMRS over your expected lifetime, based on the life expectancy input.
• Rule of 78: This indicates whether you have met the eligibility rule for an unreduced pension. If not, it shows how close you are.
• Retirement Income Projection Chart: This visualizes your total income in retirement. The stacked areas show how your TMRS pension and Social Security benefits combine to form your total annual income stream.

If your estimated pension is lower than you'd like, you have several options to improve your outcome.

1. Increase Your Years of Service: Working longer is the most direct way to increase your TMRS benefit. Each additional year adds more employee deposits, generates another year of city matching, and brings you closer to meeting the Rule of 78.
2. Seek Salary Growth: Higher earnings lead to higher employee deposits, which in turn leads to a larger city match and a bigger final account balance.
3. Supplement with Personal Savings: Your TMRS pension is one part of your retirement plan. Maximize contributions to a 403(b), Roth IRA, or other personal retirement account to create an additional income stream.
4. Optimize Your Social Security: Your TMRS pension is designed to work alongside Social Security. Use a Social Security break-even calculator to analyze the best age to claim benefits to maximize your lifetime income.
5. Stay Informed About Plan Changes: Pay attention to decisions made by your city council regarding TMRS. Advocating for the adoption of Updated Service Credits or a higher matching ratio can directly benefit you and your colleagues.

• Ignoring Your City's Specifics: Assuming all TMRS plans are the same. Your city's match ratio, deposit rate, and adoption of USCs or COLAs are unique. Always verify these details.
• Misunderstanding the "Rule of 78": Retiring before meeting the rule can lead to a permanently reduced benefit. Use the calculator to see when you'll meet the threshold.
• Forgetting About Vesting: You must have 5 years of service to be vested. If you leave your job before 5 years, you are only entitled to a refund of your own deposits.
• Relying Solely on TMRS: TMRS is a strong foundation, but most people will need additional savings to achieve their desired retirement lifestyle. Don't neglect personal retirement accounts.
• Not Planning for Taxes: Your TMRS pension benefit is generally taxable as ordinary income. Factor this into your retirement budget.