Updated October 30, 2026. Quick answer: The Employees Retirement System of Texas pays a state employee hired between September 1, 2013 and August 31, 2022 an annuity of 2.3% of the average of the 60 highest months of pay for each year of service credit. Computed for 25 years and a $60,000 average, that is $34,500 a year (computed), or $2,875 a month (computed), at age 62 or later. A member who retires earlier under the Rule of 80 loses 5% for each year before 62, and the calculator applies it. Enter your own numbers below; the figure is the standard annuity, before any payment option.
Calculate your ERS annuity
This page applies the standard service retirement annuity in the Texas Government Code to your service, age and average pay. It runs on this page and sends nothing anywhere. It covers the employee class for members hired “Hired September 1, 2013 through August 31, 2022”, which ERS calls Group 3. Enter your service credit from your ERS record, whole years and months, and the age you will be on your retirement date.
For a decision, use ERS itself: its retirement eligibility page walks each hire-date group through the rules, at ers.texas.gov, and an ERS retirement counselor can price a retirement date. This page is the published formula, shown so you can see the arithmetic.
The formula, as the statute prints it
Section 814.105 of the Government Code says the standard annuity “is an amount computed as the member’s average monthly compensation for service in that class for the 60 highest months of compensation multiplied by 2.3 percent for each year of service credit in that class”. The same section sets the limits: it “may not be less than $150 a month nor more than 100 percent of the average monthly compensation computed under Subsection (a)”. The calculator asks for the average as a yearly amount (12 times the average monthly compensation) and stops the annuity at 100% of it. It does not apply the $150 monthly minimum, which matters only to a very small annuity.
What counts as pay is ERS’s to decide: its Group 3 guide says “Highest salaries include: base pay, longevity pay, hazardous duty pay and Benefit Replacement Pay.” The guide computes the annuity from “years and months of service x 2.3%”, which is why the calculator takes service in years and months.
Worked example, calculated for 25 years of service credit and a $60,000 average: 25 x 2.3% = 57.5% of $60,000 = $34,500 a year (computed), $2,875 a month (computed).
Who can retire, and when the annuity is not reduced
For a member who “was hired on or after September 1, 2009”, Section 814.104(d) allows retirement if the member “is at least 65 years old and has at least 10 years of service credit in the employee class”; or “has at least 10 years of service credit in the employee class and the sum of the member’s age and amount of service credit in the employee class, including months of age and credit, equals or exceeds the number 80”. The second test is the Rule of 80, and it counts months. ERS’s guide gives the same test: “Your age + your eligible service credit = 80”.
The reduction is in Section 814.105(d): the annuity “is reduced by five percent for each year the member retires before the member reaches age 62”. ERS’s Group 3 guide puts it as “Annuity reduced 5% for every year under age 62, with no cap.” So a member who is 62 or older when the Rule of 80 or age 65 test is met takes the full annuity, and a member who retires at 57 on the Rule of 80 takes the full annuity minus 25%.
Retiring before 62: the reduction, computed
Worked example, calculated for 25 years and a $60,000 average, retiring at 55. Age 55 plus 25 years of service is 80, so the Rule of 80 is met. The unreduced annuity is $34,500 a year (computed). Age 55 is 7 years under 62, so the reduction is 7 x 5% = 35% and the annuity is $22,425 a year (computed), $1,868.75 a month (computed).
| Age at retirement | Years under 62 | Reduction | Annual annuity | Monthly annuity |
|---|---|---|---|---|
| 55 | 7 | 35% | $22,425 (computed) | $1,868.75 (computed) |
| 56 | 6 | 30% | $24,150 (computed) | $2,012.50 (computed) |
| 57 | 5 | 25% | $25,875 (computed) | $2,156.25 (computed) |
| 58 | 4 | 20% | $27,600 (computed) | $2,300 (computed) |
| 59 | 3 | 15% | $29,325 (computed) | $2,443.75 (computed) |
| 60 | 2 | 10% | $31,050 (computed) | $2,587.50 (computed) |
| 61 | 1 | 5% | $32,775 (computed) | $2,731.25 (computed) |
The table holds the 25 years and the $60,000 average fixed and moves only the retirement age. Every age in it meets the Rule of 80 with 25 years. A member with 10 years of service credit and no Rule of 80 has to wait until 65: at 65 with 10 years and the same average the annuity is 10 x 2.3% = 23% of $60,000 = $13,800 a year (computed).
What the annuity does not decide
1. The payment option. The figure here is the standard annuity. A survivor option lowers it; the trade is explained on the single life versus joint and survivor page.
2. The rest of the ERS decisions. Insurance, return to work and the other plan-level choices are on the Texas ERS retirement decisions page.
3. Tax. Texas has no state income tax on retirement income (the Texas pension tax page), but federal tax applies: “The taxable part of your pension or annuity payments is generally subject to federal income tax withholding.” The withholding form is described on the IRS page for Form W-4P: “so your payer can withhold the correct amount of federal income tax from your periodic pension, annuity”.
Where this calculator stops
It prices one slice of ERS: the employee class, hired September 1, 2013 through August 31, 2022. Members hired before September 1, 2013 are in other groups that ERS prices on other rules, and members hired “September 1, 2022 or after” are in a group this page does not model. It also leaves out law enforcement and custodial officers, the elected class, judicial plans, the proportionate retirement program, purchased service and its cost (the pension buyback calculator covers purchases in general), disability and survivor benefits, and cost-of-living increases. It reads age and service as you enter them. For a reduced figure it needs your age in whole years, because the statute prints the reduction for each year and prints no rule for part of a year.
How it was checked: a second, independent engine (exact fractions, the percentage, ages and reduction read from the archived statute text) agreed with this page’s engine on 60,000 random combinations of service, age and pay, and the shipped script was driven in a browser on a grid of cases against both. The rules were read from Chapter 814 of the Texas Government Code and ERS’s Group 3 guide.
Common mistakes
- Using your final salary. The statute averages your 60 highest months of compensation.
- Applying the Group 3 rules because you work for the state. The hire date decides the group.
- Expecting a full annuity at 55 on the Rule of 80. The Rule of 80 makes you eligible; the annuity is then reduced 5% for each year under 62.
- Counting only whole years of service. The Rule of 80 and the 2.3% both use years and months.
Related: Texas ERS retirement decisions, public pension decisions by system, single life versus joint and survivor, and Texas retirement taxes.
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Answer againSources
- Texas Government Code, Chapter 814, Benefits (Employees Retirement System of Texas): https://statutes.capitol.texas.gov/Docs/GV/htm/GV.814.htm
- Employees Retirement System of Texas, Ready, Set, Retire: Group 3 (hired September 1, 2013 to August 31, 2022): https://ers.texas.gov/PDFs/Retirement/readysetretire-group3-2023
- Employees Retirement System of Texas, Retirement Eligibility: https://ers.texas.gov/Active-Employees/Retirement/Retirement-Eligibility
- IRS, Topic no. 410, Pensions and annuities: https://www.irs.gov/taxtopics/tc410
- IRS, About Form W-4P, Withholding Certificate for Pension or Annuity Payments: https://www.irs.gov/forms-pubs/about-form-w-4p
Read from the system publications linked above on October 30, 2026. General information, not legal or tax advice, and not an estimate from the retirement system. Your own facts decide the outcome, and your retirement system, your plan administrator or a benefits advisor is the right place to confirm anything consequential.