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Pension Plus A
Changes that affect part-time students who were employed by a Michigan community college between July 1, 2014, and June 30, 2018, were recently signed into law. Your employer indicated that you are or were a part-time student employee who did not participate in the Michigan Public School Employees’ Retirement System. Therefore, you are now granted a one-time choice regarding your future participation in the Michigan Public School Employees’ Retirement System.
If you worked at a community college before July 1, 2014, while attending as a part-time student, you also have an opportunity to add that employment to your retirement account by paying the contributions you would have paid as a member. Visit michigan.gov/ccstudents for more information.
Before you make this decision about opting in or out of the Michigan Public School Employees’ Retirement System, it’s important to consider a few key factors:
Frequently Asked Questions
<span class="btn btn-info">What is the Michigan Public School Employees' Retirement System?</span>
The Michigan Public School Employees’ Retirement System is a statewide public employee retirement plan. The role of the Office of Retirement Services (ORS) is to carefully manage the retirement system to preserve it for current and future retirees.
<span class="btn btn-info">You're a student now, but where do you see yourself in your future career?</span>
If you expect that your future career will lead you to work for one of our participating employers, you may want to opt in to participating in the retirement plan. The retirement plan at your community college will stay with you as you move into your future career if you are working for a Michigan public school or one of the employers who participate in this retirement plan. Careers in public schools include much more than teaching. In Michigan public schools you’ll find career opportunities in human resources, accounting, nursing, food service, nutrition, dietician, management, security, facility management, vehicle maintenance, cyber security, website administration, and technical support.
<span class="btn btn-info">Which employers participate in the Michigan Public School Employees' Retirement System?</span>
The employers who participate in this retirement plan include K-12 public school districts, select public school academies and charter schools, tax-supported community colleges, and intermediate school districts in Michigan.
<span class="btn btn-info">Why would I want to continue participating in the Michigan Public School Employees' Retirement System?</span>
If you choose to continue participating, you will continue to accumulate years of service to your pension in retirement.
<span class="btn btn-info">Why would I opt out?</span>
Saving for retirement is important but continuing in the Michigan Public School Employees’ Retirement System plan may not be the best option for you. You will be 50% vested for employer contributions to the Defined Contribution part of your plan after you’ve worked for two years and 100% vested after four years. If you don’t’ plan work for the community college or a public school in Michigan for two years, you may want to opt out of participating in the Michigan Public School Employees’ Retirement System plan. If you are planning to move out of Michigan and are not likely to return, opting out may be the best choice for you. Only employment at a participating employer will add to your benefit with the Michigan Public School Employees’ Retirement System.
<span class="btn btn-info">What is a pension? </span>
A pension is a guaranteed lifetime monthly payment in retirement. Pension income is separate from and in addition to any other retirement savings, such as a 401(k) plan, and your Social Security benefits.
<span class="btn btn-info">What is a defined benefit retirement plan? </span>
A defined benefit retirement plan provides a guaranteed lifetime pension payment in retirement based on a set formula. Pension payments are not affected by stock market ups and downs. You will qualify for a pension in retirement if you meet certain age and service requirements.
<span class="btn btn-info">What is a defined contribution retirement plan? </span>
A defined contribution plan is a retirement plan in which a certain percentage of earnings is set aside each year by the employer and the employee for the benefit of the employee. Employees choose how to invest their balances among the options provided in the plan. There are restrictions to when and how the employee can withdraw these funds without penalties. Money paid into the plan by the employer and the employee are invested in the State of Michigan 401(k) and 457 Plans.
<span class="btn btn-info">How do I qualify for a pension?</span>
You will be eligible to receive a monthly pension as early as age 60 when you have at least 10 years of service. Learn more about Pension Plus plan eligibility.
<span class="btn btn-info">What are years of service?</span>
Years of service are the years or fractions of years you work that count toward your pension under the Michigan Public School Employees’ Retirement System. Total years of service and age determine when you will qualify for a pension.
<span class="btn btn-info">If I qualify for a pension, how much will I receive each month?</span>
Your pension amount depends on how long you work and how much money you earn. Learn more about the pension formula and how to calculate your pension.
<span class="btn btn-info">How much will it cost me?</span>
Both the employer and employee retirement contributions for part-time student workers between 7/1/14 and 6/30/18 have been paid by your community college. Each community college is different; it is possible your community college will ask you to pay the employee portion of the cost. Please contact your community college for more details.
Going forward you’ll pay into the retirement plan incrementally based on how much you earn from Michigan public school employment.
You’ll make pretax contributions to the pension fund based on the following rates:
$0 to $5,000 – contribute 3 percent
$5,000.01 to $15,000 – contribute 3.6 percent
$15,000.01 and over – contribute 6.4 percent
For the savings component, if you have the Personal Healthcare Fund, you’ll continue to pay 4 percent into your retirement investment account, which is made up of your Personal Healthcare Fund and your retirement savings.
If you have the Premium Subsidy benefit, you’ll continue to contribute 2 percent of your paycheck to your retirement investment account. You’ll also continue to pay 3 percent of your wages to the retiree healthcare fund.
Read more about your contributions to the Pension Plus plan.
<span class="btn btn-info">Will I have health insurance when I retire? </span>
If you have the Premium Subsidy benefit, the retirement system will pay a portion of your insurance premiums in retirement when you meet eligibility requirements. You have a graded premium subsidy in which the amount of your subsidy is based on career length. The longer you work under the retirement system, the greater the insurance subsidy is.
Members with the Premium Subsidy benefit contribute 3 percent of their wages to the Retiree Healthcare Fund.
If you have the Personal Healthcare Fund, you were automatically enrolled at a 2 percent contribution rate to your retirement investment account, earning you a 2 percent employer match. The Personal Healthcare Fund is a part of the savings component of your retirement plan that can be used for paying healthcare expenses in retirement. If you have the Personal Healthcare Fund, you won’t qualify for subsidized insurance when you retire.
<span class="btn btn-info">What if I never qualify for a pension?</span>
If you never qualify for a pension, you can request a refund (or transfer your pension contributions and interest to another qualified retirement plan) at any time after you terminate employment.
Retiree healthcare fund contributions are only refundable in certain situations. See Retiree Healthcare, Premium Subsidy for more information.
<span class="btn btn-info">How do I make my choice?</span>
In the next couple of weeks, you’ll get a yellow envelope in the mail with the form you need to complete. You’ll also receive a white self-addressed stamped envelope. Complete the form and return it to ORS 5:00 p.m. EDT on June 28, 2019.
<span class="btn btn-info">Who do I contact if I have questions?</span>
If you have any questions about the decision you are making, visit michigan.gov/orsmiaccount and use our online Message Board for secure, direct access to our representatives. You can also contact our office by phone at 800-381-5111.
ORS has partnered with Voya® to bring you the savings component of your plan. Voya will help you invest your savings, provide you with account statements, track all contributions to your investment account, handle withdrawals and distributions from your account and provide other plan services. If you have any questions about the plan, contact Voya Financial® at 800-748-6128.
<span class="btn btn-info">Is there a deadline?</span>
ORS must receive your form no later than 5:00 p.m. EDT on June 28, 2019. By default, if ORS does not receive your form by the deadline, your choice to continue participating in the Michigan Public School Employees’ Retirement System as a part-time student employee will no longer be available.
<span class="btn btn-info">Where do I send the form?</span>
Fax the form to ORS at 517-284-4416.
Or mail the form to:
P.O. Box 30171
Lansing, MI 48909-7671
<span class="btn btn-info">What if I do nothing?</span>
If ORS does not receive your form by 5:00 p.m. EDT on June 28, 2019, you will no longer have a choice to continue participating in the Michigan Public School Employees’ Retirement System. Any future employment as a part-time student employee will not count toward a retirement benefit. Any service and contributions on account from your prior time will remain on account. Log in to miAccount at www.michigan.gov/orsmiaccount to view your retirement service, contributions and manage your account. Any contributions made to your State of Michigan 401(k) and 457 accounts from prior service will remain on account with Voya Financial®. To access your account balance with Voya, contact them at 800-748-6128.