Lump-Sum Payment Options

If I resign before my retirement date and am vested is there an option to take a lump sum payment? To either rollover into a personal IRA or cash out. If so how do I figure that amount?

No, there is currently no lump-sum option in the scenario you described. If you are vested with MOSERS (you have at least 5 years of service) and then leave state employment prior to reaching the age to qualify for retirement eligibility, you would be considered a “terminated-vested” member. You will become eligible to begin drawing your lifetime monthly benefit payments once you also meet the age requirement (and all other legal requirements) and retire under a MOSERS defined benefit pension plan. 

The scenarios in which a lump-sum option are available through MOSERS are the following:

1. BackDROP – Work in a MOSERS benefit-eligible positon at least two years beyond normal retirement eligibility and then you can elect a lump-sum payment at retirement in addition to your lifetime monthly benefit payments.

2. Refund of Member Contributions – If you are a member of the MSEP 2011 or Judicial Plan 2011 (first employed in a MOSERS benefit-eligible position on or after 1/1/2011 and contribute 4% of our pay to MOSERS) and you leave state employment prior to reaching normal retirement eligibility, you may request a refund of your member contributions.

3. If you meet the qualifications for the Cash Out program (available only to vested members of MSEP who left state employment between 10/1/1984 and 9/1/2002) or a “Buyout” program authorized by the legislature (among other eligibility criteria, you must not have worked in a MOSERS or MPERS benefit-eligible positon at any time since 6/30/2017), you may be eligible for a lump-sum payment. However, no one currently employed in a MOSERS benefit-eligible position is eligible for either the Cash Out or Buyout lump-sum program.

Keep in mind that any of the following may affect your retirement eligibility: Your retirement plan (MSEP, MSEP 2011, etc.), age, service, and if you retire directly from active employment versus leaving state government and waiting to retire. Contact a MOSERS benefit counselor to discuss your specific situation. You may also contact a MOSERS benefit counselor to request benefit estimates for various scenarios (including a scenario of leaving employment prior to retirement eligibility).