Retirement in Alaska

For Teachers (TRS):

• If you entered the Teachers’ Retirement System between 7/1/1955 and 6/30/1990 you are a: TRS Tier I employee.
• If you entered the Teachers’ Retirement System between 6/30/1990 and 6/30/2006 you are a: TRS Tier II employee.
• If you entered the Teachers’ Retirement System after 6/30/2006 you are a: TRS Tier III employee.

For non-certificated public school employees (PERS):

• If you entered the Public Employees Retirement System between 1/1/1961 and 6/30/1986 you are a: PERS Tier I employee.
• If you entered the Public Employees Retirement System after 6/30/1986 you are a: PERS Tier II employee.
• If you entered the Public Employees Retirement System after 6/30/1996 you are a: PERS Tier III employee.
• If you entered the Public Employees Retirement System after 6/30/2006 you are a: PERS Tier IV employee.

The primary difference between DB and DC plans is security in retirement. While both plans set aside money for retirement, DB plans guarantee income through a pension. DC plans take money from the state and the employee and invest that money in a plan similar to a 401 (k). Under DC plans, an employee’s earnings are subject to fluctuations in global financial markets and contains no guarantees for income in retirement.

No TRS member in Alaska pays into Social Security. Some PERS members participate in Social Security, some in the Alaska Supplemental Annuity Plan (SBS-AP), and some in neither. 

Follow this link to see whether your district offers PERS employees Social Security, SBS, or neither.

Retirement planning is unique and different for every person. Your tier, savings, other investments, and many other factors should all be considered when planning for retirement. Speaking with a financial planner and utilizing the tools available through the Alaska Division of Retirement and Benefits will maximize your opportunities for success.

We are actively building a cohort of engaged members who want to get more involved in fixing Alaska’s retirement system. The first step is joining our email list here. Signing up will allow you to receive retirement specific information, notify you of opportunities to testify, and connect you with other educators across the state. If you have interest in joining the SOAR committee, please contact us at info@neaalaska.org.

Alaska Division of Retirement and Benefits:

• TRS I & II Defined Benefit (DB) Plan
• PERS I, II, and III Defined Benefit (DB) Plan
• TRS III Defined Contribution Retirement (DCR) Plan
• PERS IV Defined Contribution (DCR) Plan

EMPOWER Retirement:

• Access my Empower account here.

In 1935, when Social Security was established, the Federal Government did not impose mandatory Social Security participation on state and local government employees.

In 1951, the Social Security Administration created Section 218 of the Social Security Act—commonly known as Voluntary Social Security—that made Social Security participation voluntary for state and local governments. During this process, the state of Alaska created a “Section 218 Master Agreement” with the federal government. At this time, the “Territorial TRS” system was excluded from voluntary Social Security coverage.

In 1955, the Social Security Administration said that members of excluded systems (TRS) could now vote to elect Social Security coverage. In recent history, no TRS members have held a vote to return to Social Security.

The Government Pension Offset and Windfall Elimination Provision (GPO-WEP) are federal rules that could potentially affect PERS and TRS members that are not enrolled in Social Security through their PERS/TRS employer. GPO-WEP can impact your Social Security earnings in retirement. It is recommended that any educator who is not paying into Social Security through their current school district (all TRS members) should develop a basic understanding of GPO-WEP and should make an effort to determine potential implications or how to avoid or reduce penalties.

You are encouraged to login in to your Social Security account to understand your potential Social Security benefits.

Find more resources and information regarding GPO-WEP.

Political subdivisions of the state—school districts or municipal governments—can join Social Security with a modification to the state of Alaska “Section 218 Master Agreement.” To individually choose whether or not they return to Social Security, a school district can allow TRS employees to hold a “divided vote.”

Click here for more resources on “How does a school district hold a divided vote to allow TRS members to voluntarily rejoin Social Security?”

On July 1, 2006, Senate Bill 241 took effect, creating the Teacher’s Retirement System Tier III (TRS III) and Public Employee Retirement System Tier IV (PERS IV). This action resulted in Alaska moving from a state with a defined benefit pension—one of the better retirements for educators and public employees in the country—to a defined contribution retirement system that is one of the worst retirements in the country.

See the State of Alaska charts detailing TRS III /PERS IV.

Fixing the retirement system has been one of NEA-Alaska’s top legislative priorities since Alaska shifted from a defined benefit (DB) plan to a defined contribution (DC) plan in 2006. NEA-Alaska has been one of several public-sector unions advocating for a return to a DB plan. So far, these efforts have been unsuccessful.

In recent years, NEA-Alaska developed and advocated for a “hybrid plan” modeled after other states that have successfully managed pension liabilities and risk, while still offering educators and state employees a pension. Hybrid plans offer both a modest DB retirement coupled with a DC—so employees have both.

Learn More