Eligible Service Credit Purchases Increase Your Retirement
Benefit
Your pension is based on your age at retirement, your final
average salary, and your total retirement service credit. The
more years of retirement service credit you have, the greater
your benefit.
You may be eligible to “buy” service time when you were not
contributing to CCCERA, thus increasing your retirement benefit.
If you are considering a service credit purchase, a general rule
to remember is this: time during which you made contributions is
not purchasable, whether you were a member of CCCERA, or other
public retirement system, unless you withdrew your
funds and no longer qualify to receive a benefit.
Members who are interested in purchasing service credit should
request an estimate of the cost from CCCERA. You can make this
request by phone, or complete a
Request for Retirement Estimate (Form 108) by
mail. Most necessary information is available to CCCERA, but you
may be asked later for documentation if you decide to enter into
a contract to purchase service.
After a retirement counselor calculates your cost estimate,
CCCERA will send you a letter explaining your options. At that
time, you can make an appointment with your counselor to clarify
any issues you may have, decide on the amount of time to
purchase, make payment arrangements and sign a contract.
Categories of Purchasable Time
-
Time Prior to Membership with CCCERA: If
you worked for a participating employer (special district) or
Contra Costa County, and were not eligible for CCCERA
membership, you may purchase service credit for the time you
worked. Examples of ineligible positions are part-time (less
that 20 hours per week), certain job classifications such as
permanent intermittent, or temporary.
-
Medical Leave of Absence: CCCERA members
returning to active service following
an unpaid medical leave of absence, can purchase up
to 12 consecutive months of time.
-
Military Leave: Time spent in military
service may be purchased if you were a member of CCCERA when
you (resigned or obtained a leave of absence) left to serve in
the military, and returned to CCCERA membership within 90 days
of your honorable discharge. If you served in the
military prior to CCCERA membership, you may be able
to purchase this time as public service time.
-
Public Service: If you were employed by a
public service agency prior to your membership with
CCCERA, you may be eligible to purchase this time with CCCERA,
if your former public employer does not
offer reciprocity with CCCERA, or accept re-deposits of
contributions that were refunded to you at the time of
termination from their plan.
To purchase public service time you cannot be eligible to receive
a retirement benefit from the public agency you were
previously employed by. Examples of public service agencies
are the Federal government, other county or city governments in
California, and special districts, such as water or sanitary
districts.
How to Purchase Service Credit
Service credit purchases follow a complex set of laws and
regulations established by the 1937 Act. Generally, the
costs to purchase service credit fall into two
categories, depending on the type of eligible credit.
- You must pay your contributions and interest that
would have accrued during the time periods you are purchasing, or
- You must pay your contributions plus your
employer’s contributions and interest that would have
accrued on both amounts.
Purchases can be made with post-tax dollars.
Your Payment Options
- One lump sum payment for the full amount;
- Monthly payroll deductions;
- A combination lump sum “down payment,” then monthly payroll
deductions to complete the contract;
- Fund transfer from another eligible retirement plan, such as
a 457 plan.
The purchase contract term usually cannot exceed the length of
time you are buying (for example, conversions from Tier 2 service
to Tier 3 are an exception). In addition, the maximum contract
time for buying any amount of service is five years.
All payroll deduction service contracts must be paid in full by
your retirement date, or date of termination. However, you may be
able to purchase service credit with an after-tax lump sum
payment, up to 120 days after your retirement date.
Service credit is posted to your account immediately if your
payment is a lump sum. When purchasing by monthly payroll
deduction, service credit is posted to your account as you make
payments.
