Updated October 30, 2026. Quick answer: The State Employees’ Retirement System of Illinois (SERS) pays a Tier 1 member under the Regular Formula 1.67% of final average compensation for each year of service as a covered employee, and 2.2% for service as a noncovered employee, never more than 75% of that compensation. Computed for 30 covered years and $6,000 of monthly final average compensation, that is $3,006 a month (computed), or $36,072 a year (computed). Tier 1 means a member who first joined before January 1, 2011; a later member is Tier 2 and is not priced here. Enter your own numbers below; the figure is the basic annuity, before any payment option.
Calculate your SERS Tier 1 annuity
This page applies the annuity formula in the Illinois Pension Code to your service, age and final average compensation. It runs on this page and sends nothing anywhere. It covers a Tier 1 member of SERS under the Regular Formula: the Pension Code applies the Tier 2 rules to “a person who, on or after January 1, 2011, first becomes a member or a participant under any reciprocal retirement system or pension fund established under this Code”, so this page is limited to a member who joined earlier. Enter your service from your SERS record, whole years and months, split between covered and noncovered service, the whole age you will have reached on your retirement date, and your final average compensation as a monthly amount.
For a decision, use SERS itself: its member account and pension estimate calculator are at illinois.gov/sers. This page is the published formula, shown so you can see the arithmetic.
The formula, as the statute prints it
Section 14-108 of the Pension Code sets the amount. For service as a covered employee: “for service credit established as a covered employee it shall be 1.67% of final average compensation for each year of service”. For a noncovered employee, “the retirement annuity for membership service and prior service shall be 2.2% of final average compensation for each year of service”. The Code defines the two groups. A covered employee is “Any employee covered by coordination with the Federal Social Security Act as herein provided.” A noncovered employee is one “in a position not eligible for Social Security coverage”, or one who elected not to accept coordination. If you are not sure which applies to your years, your SERS statement shows it.
The statute then caps the annuity: “A retirement annuity shall not exceed 75% of final average compensation”. The calculator applies the cap.
Worked example, calculated for 30 covered years and $6,000 of monthly final average compensation: 1.67% x 30 = 50.1% of $6,000 = $3,006 a month (computed), $36,072 a year (computed). For 30 noncovered years, 2.2% x 30 = 66% of $6,000 = $3,960 a month (computed). With 46 covered years the formula would give 76.82% of the average, $4,609.20 a month (computed), and the cap holds the annuity at $4,500 a month (computed).
What the formula gives at each length of service, at $6,000 of monthly final average compensation, for a member retiring at 62:
| Years of service | All covered: monthly annuity | All noncovered: monthly annuity |
|---|---|---|
| 8 | $801.60 (computed) | $1,056 (computed) |
| 10 | $1,002 (computed) | $1,320 (computed) |
| 20 | $2,004 (computed) | $2,640 (computed) |
| 25 | $2,505 (computed) | $3,300 (computed) |
| 30 | $3,006 (computed) | $3,960 (computed) |
| 35 | $3,507 (computed) | $4,500 (computed) |
What final average compensation is
It is not your final salary. Section 14-103.12 defines it as “the monthly compensation obtained by dividing the total compensation of an employee during the period of” “the 48 consecutive months of service within the last 120 months of service in which the total compensation was the highest”. It adds a limit on a late raise: “the average compensation for the last 12 months of the 48-month period shall not exceed the final average compensation by more than 25%”. The calculator takes the figure SERS shows on your account, so it does not run either rule.
When you can retire
Section 14-107 sets the tests. “A member is entitled to a retirement annuity after having at least 8 years of creditable service.” “A member who has at least 35 years of creditable service may claim his or her retirement annuity at any age.” With fewer than 35 years, the member may claim the annuity “upon or after attainment of age 60 or, beginning January 1, 2001, any lesser age which, when added to the number of years of his or her creditable service, equals at least 85”. “For purposes of the rule of 85, portions of years shall be counted in whole months.” The calculator adds your age and service in whole months and tests the total against 85 years (1,020 months).
The same section allows an earlier, reduced start: “A member upon or after attainment of age 55 having at least 25 years of creditable service (30 years if retirement is before January 1, 2001) may elect to receive the lower retirement annuity provided in paragraph (c) of Section 14-108 of this Code.” The calculator uses the 25-year rule, which applies to retirement on or after January 1, 2001.
Retiring from 55 with 25 to 29 years: the reduction
Paragraph (c) of Section 14-108 sets the cut: “with at least 25 but less than 30 years of creditable service if retirement is on or after January 1, 2001”, “the retirement annuity shall be reduced by 1/2 of 1% for each month that the member’s age is under age 60 at the time of retirement”. The calculator counts the months from your age at retirement to 60, so each whole year under 60 is a 6% reduction (computed). A member whose age plus service reaches 85 has no reduction, which is why the table below stops at 25 years.
Worked example, calculated for 25 covered years and $6,000 of monthly final average compensation, a member who retires at 58: age plus service is 83, below 85, so the annuity is reduced. The annuity before reduction is $2,505 a month (computed), 24 months under 60 is 12% (computed), and the annuity is $2,204.40 a month (computed).
Reduction by age at 25 covered years and $6,000 of monthly final average compensation:
| Age at retirement | Reduction | Monthly annuity | Annual annuity |
|---|---|---|---|
| 55 | 30% (computed) | $1,753.50 (computed) | $21,042 (computed) |
| 56 | 24% (computed) | $1,903.80 (computed) | $22,845.60 (computed) |
| 57 | 18% (computed) | $2,054.10 (computed) | $24,649.20 (computed) |
| 58 | 12% (computed) | $2,204.40 (computed) | $26,452.80 (computed) |
| 59 | 6% (computed) | $2,354.70 (computed) | $28,256.40 (computed) |
A member with 7 years who is 62 has no annuity on these tests, because the minimum is 8 years; the calculator says so.
What to do next
1. Get SERS’s own number. The member account prices your exact retirement date, reduction and payment option; this page is the printed formula.
2. The rest of the SERS decisions. Payment options, the refund and the reduced-retirement and annual-increase rules are on the Illinois SERS retirement decisions page and the reduced retirement and annual increases page, and the latest figure is on the Illinois SERS COLA page.
3. Tax. Illinois’s treatment of pension income is on the Illinois pension tax page. Federal tax applies too: “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 thing: the Regular Formula annuity of a Tier 1 SERS member, retiring from service. Tier 2 members, the alternative formula for security employees and other eligible service in Section 14-110, the 3% formula in Section 14-108(g) for noncovered corrections staff, the minimum-annuity rules, the pre-1969 coordination rules and the other Illinois systems are not priced. It leaves out the payment options and survivor choices, disability benefits, the annual increase, purchased service and its cost (the pension buyback calculator covers purchases in general), and the 25% limit on a late raise. It reads service, age and compensation as you enter them.
How it was checked: a second, independent engine (exact fractions, with the 1.67%, the 2.2%, the 75% cap, the 8 years, the 35 years, the 85 total and the reduction rate read from the archived statute text) agreed with this page’s engine on 240,000 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 40 ILCS 5/14-107, 14-108, 14-103.12, 14-103.36, 14-103.38 and 1-160 as printed on the Illinois General Assembly website.
Common mistakes
- Entering a yearly salary. The Code states final average compensation as a monthly amount and the annuity is monthly.
- Using your final salary. The average is your highest 48 consecutive months within the last 120.
- Using 1.67% for noncovered service. The Code prints 2.2% for a noncovered employee, and the two groups can both appear in one career.
- Treating a Tier 2 member’s annuity as this one. A member who first joined on or after January 1, 2011 is under Section 1-160, not the Tier 1 rules shown here.
Related: Illinois SERS retirement decisions, public pension decisions by system, single life versus joint and survivor, and Illinois retirement taxes.
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Answer againSources
- Illinois Compiled Statutes, 40 ILCS 5/14-107 (Retirement annuity, service and age conditions): https://www.ilga.gov/Documents/legislation/ilcs/documents/004000050K14-107.htm
- Illinois Compiled Statutes, 40 ILCS 5/14-108 (Amount of retirement annuity): https://www.ilga.gov/Documents/legislation/ilcs/documents/004000050K14-108.htm
- Illinois Compiled Statutes, 40 ILCS 5/14-103.12 (Final average compensation): https://www.ilga.gov/Documents/legislation/ilcs/documents/004000050K14-103.12.htm
- Illinois Compiled Statutes, 40 ILCS 5/14-103.36 (Covered employee): https://www.ilga.gov/Documents/legislation/ilcs/documents/004000050K14-103.36.htm
- Illinois Compiled Statutes, 40 ILCS 5/14-103.38 (Noncovered employee): https://www.ilga.gov/Documents/legislation/ilcs/documents/004000050K14-103.38.htm
- Illinois Compiled Statutes, 40 ILCS 5/1-160 (Provisions applicable to new hires (Tier 2)): https://www.ilga.gov/Documents/legislation/ilcs/documents/004000050K1-160.htm
- 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.