Missouri LAGERS Retirement Options: Payments, PLUS and Buyback

Updated October 2, 2026. Quick answer: Missouri LAGERS asks a retiring member to choose a payment option, and its page says the choice is permanent and cannot be changed. The Life Option pays an unreduced benefit for life. Option A pays 85 percent of the Life amount with 75 percent to a surviving spouse, Option B pays 90 percent with 50 percent, and Option C pays 95 percent with payments guaranteed for 120 months. Under RSMo 70.660 the 85 and 90 percent are the equal-age figures, which move with the gap between the member’s age and the beneficiary’s, and the survivor shares come out of the reduced allowance. The optional Partial Lump Sum equals 24 monthly Life payments and cuts the monthly benefit by approximately 16 percent, that is, to 84 percent at retirement age 60 under the statute.

Employees of the City of St. Louis and the City of Kansas City, Missouri belong to separate city systems with their own rules: St. Louis Employees Retirement System decisions and Kansas City employees retirement decisions.

The decisions that matter, in the order they come up

The two LAGERS web pages read for this guide, Payment Options and Purchasing Service, describe three decisions that carry a dollar consequence: which payment option to elect at retirement, whether to add the Partial Lump Sum (PLUS) feature, and, earlier in a career, whether to purchase or transfer service. “LAGERS offers a variety of payment options that give retirees flexibility in how you choose to receive your payments.” Both pages are short, so this guide reports what they say, sets beside them what the LAGERS statute (RSMo chapter 70, sections 70.600 to 70.755) says where the two differ, and lists in a final section what neither settles. A member’s own estimate and the LAGERS office decide any actual figure.

The four payment options and what each one pays

The choice comes at the end of the application. “you’ll be asked to select one of the following options” “The selection that an applicant makes during the retirement process is permanent and cannot be changed.” That sentence is the single most important fact on the page: the option is not a draft that can be revisited after retirement. RSMo 70.660 fixes the same deadline, “before the date the first payment of a person’s allowance becomes due but not thereafter”, and names a fourth choice besides A, B and C: Option D, “Some other option approved by the board which shall be the actuarial equivalent of the allowance to which the member is entitled under this system.” If a member elects no option, “his or her allowance for life shall be paid to the member as a single lifetime benefit”. For a general comparison of the shapes involved, see single-life versus joint-and-survivor pension.

Life Option: “The Life payout option pays an unreduced benefit to you for your lifetime.” “Upon your death, the monthly payments will cease.” That is the only option described as unreduced, and it carries no monthly payment for anyone after the member dies.

Option A: “This option not only provides a monthly benefit for your lifetime, but also provides an additional monthly payment to your spouse should you predecease your spouse.” On the numbers: “If you elect Option A you will receive 85% of your Life option for your lifetime, and should you predecease your spouse, your spouse receives 75% of your benefit for life.” The 85% is the statute’s equal-age figure. For a first payment due on or after October 1, 1998, RSMo 70.660 sets the percent at “eighty-five percent if the retirant’s age and the retirant’s beneficiary’s age are the same on such first due date”, “decreased by three-quarters of one percent for each year that the beneficiary’s age is less than the retirant’s age”, or “increased by three-quarters of one percent, up to a maximum of ninety percent, for each year that the beneficiary’s age is more than the retirant’s age”.

Option B: “If you elect Option B you will receive 90% of your Life allowance for your lifetime, and should you predecease your spouse, your spouse then receives 50% of your benefit for life.” LAGERS calls Options A and B the two spousal payment options. Option B pays the member more each month than Option A and pays the surviving spouse less. Its 90% is also an equal-age figure: RSMo 70.660 sets the percent at “ninety percent if the retirant’s age and the retirant’s beneficiary’s age are the same on such first payment due date”, “decreased by one-half of one percent for each year that the beneficiary’s age is less than the retirant’s age”, or “increased by one-half of one percent, up to a maximum of ninety-five percent for each year that the beneficiary’s age is more than the retirant’s age”.

Option C: “The Option C payout option pays 95% of your Life allowance for your lifetime with the added provision that if you should die before receiving 120 monthly payments, a designated beneficiary(ies) will receive the same monthly allowance until a total of 120 monthly payments have been made.” The other side of that guarantee: “If you live more than ten years into retirement, you will continue to receive the same monthly benefit payments until death, but your beneficiary(ies) would not be eligible for a monthly benefit.”

The options side by side

The table below uses the percentages LAGERS states and, for Options A and B, notes the age adjustment that RSMo 70.660 adds. Each percentage is a share of the Life Option amount, which is the unreduced figure the member would receive under the Life Option.

A computed example from an assumed $2,000 Life Option amount, not a LAGERS figure: Option A is 2,000 multiplied by 85 and divided by 100, a computed $1,700 a month, which gives up a computed $300 a month against the Life Option. Option B is a computed $1,800 a month. Option C is a computed $1,900 a month, which gives up a computed $100 a month. The $2,000 is an assumed input chosen for the arithmetic. On these percentages Option A gives up the most each month and Option C the least. The figures assume a beneficiary the same age as the member. The survivor share is taken from the reduced payment: under Option A it is three-quarters of the reduced $1,700, a computed $1,275 a month (0.75 multiplied by 1,700), and under Option B one-half of the reduced $1,800, a computed $900 a month (0.5 multiplied by 1,800).

The pages word the spouse’s share as a percentage of the member’s benefit, and RSMo 70.660 settles what that means: the surviving beneficiary is paid “three-quarters of the retirant’s reduced allowance” under Option A and “one-half of his or her reduced allowance” under Option B. So the share is taken from the reduced payment, not from the Life Option amount. A member comparing the options should still ask LAGERS for a written estimate that shows the exact survivor dollars for the beneficiary’s age.

Who can be the beneficiary, and what cannot be changed later

For both spousal options LAGERS limits who qualifies and fixes the choice. “An eligible beneficiary under Option A is a spouse of 2 or more years or an adult who is 40 or older and has been more than half financially dependent on you for 2 or more years.” “Once you elect Option A, your beneficiary cannot be changed in the future.” The Option B page uses the same eligibility wording and the same lock: “Once you elect Option B, your beneficiary cannot be changed in the future.” The practical meaning is that an election of Option A or B ties the benefit to one named person for as long as that person lives.

Option C works differently. “Unlike Options A and B, you can change your beneficiary designation under Option C at any time, even after you are retired.” The page also spells out who is paid if the primary beneficiary dies during the guaranteed period: “Under Option C, should you and your primary beneficiary die before 120 monthly benefit payments have been made, the remaining payments will be made to the primary beneficiary’s estate, unless you have designated a contingent beneficiary.” “If the contingent beneficiary is living at the time of the primary beneficiary’s death, the remainder of the 120 monthly benefit payments will be paid to the contingent beneficiary.” “If no beneficiaries are living at the time of your death within the 120-month period, the remaining payments will be paid in a lump sum to the personal representative of your estate.” The statute words the estate rule differently: “If there is no such beneficiary surviving the retirant, the reserve for such allowance for the remainder of such one hundred twenty months’ period shall be paid to the retirant’s estate.” It speaks of the reserve for the remaining months, and does not describe that amount as the sum of the remaining payments.

The Pop-Up Provision

A spousal option does not have to stay reduced forever if the beneficiary dies first. “If you retired after September 1, 1992 and elected either Option A or B, you are covered under LAGERS Pop-Up Provision.” Section 70.660 as currently codified states no retirement-date condition; its history note lists a 1992 amendment (H.B. 1440). RSMo 70.660 says: “The death of the beneficiary designated under option A or B of subsection 2 of this section before the death of the retirant after retirement shall, upon written notification to the system of the death of the beneficiary, cancel any optional plan elected at retirement to provide continuing lifetime benefits to the beneficiary and shall return the retirant to his or her single lifetime benefit equivalent, to be effective the month following receipt of the written notification of the death of the beneficiary by the system.” In the page’s words, “this provision allows you to remove the Option A or B reduction”, returning “to 100% of your Life Option amount”. The step is not automatic: “You must notify the LAGERS office upon the death of your beneficiary to enact the Pop Up Provision.”

The pop-up has a cost of its own. “Once enacted, you are locked into the Life Option and may not designate a new beneficiary under Option A or B.” “You may designate a new beneficiary for any remaining contributions you may still have remaining in the system (if applicable).” A computed example from the assumed $2,000 Life Option amount, not a LAGERS figure: a member under Option A receives a computed $1,700 a month, and after the pop-up the payment returns to the $2,000 Life Option amount. The page names the 1992 date as a condition; section 70.660 as currently codified does not, so a member who retired earlier should still ask LAGERS how the provision applies to that retirement.

Option C worked through with LAGERS’s own numbers

The Option C description includes a sample based on a $1,125 Life Option amount. “95% X $1,125 (Life Option Amount) = $1,068.75 per month”. A recomputation: 95 multiplied by 1,125 and divided by 100 is a computed $1,068.75, which matches. The sample then runs three cases. In the first, the member dies after 60 payments: “$1,068.75 per month is payable to your beneficiary of record for 60 months”. In the second, the member dies after 118 payments: “$1,068.75 per month is payable to your beneficiary of record for 2 months”. In the third, “No further benefit is payable” once 120 or more payments have been made.

A computed total from those figures, not a LAGERS figure: 60 payments of $1,068.75 to the beneficiary add up to a computed $64,125.00. The guarantee is therefore worth most when death comes early and nothing once 120 payments have been made, which is why the page says that a member who lives more than ten years into retirement keeps receiving the same payment while the beneficiary receives nothing monthly.

The Partial Lump Sum (PLUS)

“The Partial Lump Sum feature provides the option to elect a lump sum distribution coupled with a reduced monthly benefit.” “A member can elect to add the PLUS feature to the Life, Option A, Option B, or Option C Payout Options.” “The lump sum distribution is equal to 24 monthly payments of the Life Option amount (does not include any temporary allowance payable under a Life and Temporary plan).” “Electing the Partial Lump Sum results in a reduction (approximately 16 percent) of the retiree’s future monthly benefit.” RSMo 70.660 fixes the reduction by retirement age: “The retirant’s monthly life allowance shall be reduced to eighty-four percent if the retirant’s age at the time of retirement is sixty”, and that percent is “decreased by four-tenths of one percent for each year the retirant’s age at the time of retirement is greater than sixty”, or “increased by four-tenths of one percent for each year the retirant’s age at the time of retirement is less than sixty”. The PLUS reduction is applied first: “The reductions in monthly life allowance in this subsection shall be calculated and applied before any reductions under subsection 2 of this section are calculated and applied.” The election, like the option, must come “before the date the first payment of a person’s allowance becomes due but not thereafter”. The statute works no example for other ages, so a member should ask LAGERS for the figure at their own retirement age.

PLUS is a trade of monthly income for cash at the start of retirement. The lump sum equals 24 months of the Life Option amount and the monthly benefit falls by approximately 16 percent, so the cash received early is paid for by smaller payments every month afterward.

A PLUS example, and what the trade costs over time

LAGERS gives one example: “A retiree, age 60, could elect the Life Payout Option of $1,125 per month, with no lump sum” OR the retiree could “receive $27,000 lump sum (24 x $1,125) and a reduced monthly benefit of $945 per month ($1,125 x 84%)”. A recomputation: 24 multiplied by $1,125 is a computed $27,000 and $1,125 multiplied by 84 and divided by 100 is a computed $945, which match the page. The monthly benefit given up is a computed $180.

A computed example from an assumed $2,000 Life Option amount, not a LAGERS figure: the lump sum is 24 multiplied by 2,000, a computed $48,000. The reduced benefit at 84 percent of 2,000 is a computed $1,680 a month, so the retiree gives up a computed $320 a month. The given-up amounts take a computed 150 months, or a computed 12.5 years, to add up to the lump sum. The 84 percent is the statute’s figure for retirement at age 60, which LAGERS describes as approximately 16 percent, and the $2,000 example assumes that age; at another age the percentage changes, so the exact reduction for a member’s own case comes from a LAGERS estimate. The $2,000 is an assumed input. This is arithmetic on the page’s own rule, not a recommendation to take or skip the feature.

Two features in the page matter for the timing. “Lump-sum payments made under the PLUS option will be paid no sooner than ninety (90) days after the effective date of retirement, and no later than one-hundred fifty (150) days after the effective date of retirement.” The statute counts from a different date. RSMo 70.660 says the lump sum is paid “upon written application to the board, not fewer than ninety days nor more than one hundred fifty days after the date the first payment of his or her monthly allowance becomes due”. “Deferral of the lump-sum payment to the next calendar year is not permitted” unless the deferred payment falls within that 90 to 150 day period. If the retiree dies first: “In the event a retiree dies before receiving the partial lump sum payment, the lump sum will be paid to the retiree’s beneficiary of record.”

Tax on the lump sum, and where the IRS rules fit

LAGERS states the tax treatment directly. “Lump sum payments are subject to all applicable taxes, unless directly rolled into another eligible retirement account.” “LAGERS is required by law to withhold 20% of the taxable distribution, which is forwarded to the IRS.” On age: “You may also be subject to early distribution penalties, if you receive the payment before attaining age 55 if you are a general employee and age 50 if you are a public safety employee.” LAGERS closes the passage with its own limit: it says its staff cannot give tax advice and urges a licensed tax professional. For how Missouri treats a pension payment, see Missouri retirement taxes and does Missouri tax pensions.

What the IRS adds on tax

A refund or lump sum from a public pension is a distribution, so the IRS rules apply on top of LAGERS’s own. On withholding, the IRS says that a taxable eligible rollover distribution paid to you “is subject to mandatory income tax withholding (generally at a rate of 20%), even if you intend to roll it over later”, and that if you roll it over yourself “you’ll have to add funds from other sources equal to the amount withheld”. The LAGERS page says a PLUS payment is subject to taxes unless it is directly rolled into another eligible retirement account, which is the situation the IRS rollover rules address. The rollover clock, if the money is paid to you: “you have 60 days from the date you receive it to roll it over to another eligible retirement plan”.

On early distributions the IRS says “the law imposes a 10% additional tax on certain early distributions from certain retirement plans”. Its list of exceptions includes “Distributions made to you after you separated from service with your employer after attainment of age 55” and “Distributions made to a qualified public safety employee from a governmental plan”. Whether an exception fits a particular refund depends on your own plan and facts, so confirm it with a tax preparer before you take one.

Buying or transferring service credit

“LAGERS members may have the option to add additional service to their benefit calculation by either purchasing or transferring service.” The Purchasing Service page describes three routes, each with its own gate. For the cost-benefit arithmetic, see the pension buyback calculator.

Other public employment: “To be eligible to purchase other public employment service in the LAGERS system, you must be an active, vested LAGERS member who either”: “Had previous non-federal public employment in the state of Missouri that was not covered by a retirement plan”, or “Had previous non-federal public employment in the state of Missouri and were covered under another public pension system, but did not become vested”.

Military service: “To be eligible to purchase military service in the LAGERS system, you must be an active LAGERS member with previous US military service.” “Eligible members may purchase up to four years of military service toward their LAGERS benefit.” RSMo 70.640 adds conditions: the member must have served “prior to becoming a member”, must have become a member “after discharge under honorable conditions”, and must elect the purchase “prior to retirement”, for service “not to exceed four years”. The member must also not be receiving, or be eligible to receive, retirement credits or benefits “from any other public or private retirement plan for the service to be purchased”, and must file an affidavit saying so with the retirement system. The section adds that “if the member is eligible to receive retirement credits in a United States military service retirement system, he shall be permitted to purchase creditable prior service equivalent to his service in the armed services, but not to exceed four years”. Proof is required: “LAGERS will require a copy of any pertinent military discharge papers (DD 214) to verify honorable discharge and period of service in the US armed forces.”

Transfer: “To be eligible to transfer service to LAGERS, you must be an active, vested LAGERS member.” “Service may only be transferred to LAGERS from other Missouri Public Pension Systems.” “You must be vested in the other Missouri Public Pension System.” “LAGERS must have a mutual agreement with the other Missouri Public Pension System in order to transfer service.”

How a purchase is priced and paid for

The process on the page begins with an estimate, then an official quote. For an eligible member, “you can create an estimate for purchasing service on your myLAGERS account”. When ready to proceed, “please call the LAGERS office to begin the process and receive an official cost calculation”. Once the official figures arrive, “you have the option to purchase the service in a lump sum, in 12 month installments, in 24 month installments, or not at all”. “LAGERS will accept direct rollovers from other qualified retirement plans for the purposes of purchasing service credit.”

The third row’s payment cell reflects only that the page describes a transfer without a payment schedule. A member with prior Missouri public service should request the official cost calculation before deciding, because the LAGERS page gives no price formula. For military service RSMo 70.640 does: the member pays “an amount equal to the present value, on the date of payment, of the amount of the additional retirement allowance that would be obtained by virtue of the purchase of the additional service credit”, using the interest rate and mortality table the board adopts. “The payment shall be made over a period of not longer than two years, measured from the date of election, and with compound interest on the unpaid balance.” The statute sections read give no such rule for other public employment or for transferred service.

The Life Option and contributions

The Life Option description is the only place the pages mention what happens to a member’s own contributions at death. “If you haven’t withdrawn at least your accumulated contributions before death, a refund of the balance of the account is made to your beneficiary of record.” The refund turns on whether the member has withdrawn at least the accumulated contributions before death, and the pages read do not explain how that is measured. RSMo 70.690 covers a different case: when a member dies and no allowance becomes or will become payable, “his accumulated contributions standing to his credit in the members deposit fund at the time of his death shall be paid to such person or persons as he shall have nominated by written designation duly executed and filed with the board”; failing a designated person, “such accumulated contributions shall be paid to his surviving spouse, or to his estate if there is no surviving spouse”. The balance refund after an allowance has begun is not stated in the statute sections read.

What this page could not settle

• The pages read do not state a vesting period for LAGERS, and the chapter 70 sections read define none; RSMo 70.645 does require “five or more years of credited service in force” to retire with an allowance.
• RSMo 70.645 sets the retirement test: the member “must have attained his minimum service retirement age, or if an election has been made in accordance with section 70.646 to provide for alternate eligibility, have years of attained age and years of credited service in force which total eighty or more, and must have five or more years of credited service in force”. RSMo 70.600 defines the minimum age as “age sixty for a member who is neither public safety personnel as defined in section 70.631, a policeman, nor a fireman” and “age fifty-five for a member who is public safety personnel as defined in section 70.631, a policeman, or a fireman”. RSMo 70.670 allows early retirement when “the member’s age shall be within five years of his minimum service retirement age and he shall have five or more years of credited service in force”, with the allowance reduced by “One-half of one percent multiplied by the number of months by which his age at early retirement is younger than his minimum service retirement age.”
• The LAGERS pages take the Life Option amount as given. RSMo 70.655 makes it a percent of final average salary times years of credited service, at the rate of the benefit program the employer elects. The section lists fifteen benefit programs, at rates from one percent (L-1) to two and one-half percent (L-11, which may cover only a position not concurrently covered by federal Social Security); the eight LT programs also pay a temporary allowance that ends by age 62 or 65, and some programs are closed to new elections. “Each employer shall have the credited service of each of its members covered by benefit program L-1 provided for in this section unless such employer shall have elected another benefit program provided for in this section.” The pages read do not say which program a given employer has elected.
• RSMo 70.690 describes the refund to a member who leaves before becoming entitled to an allowance: “he shall be paid, upon his written application filed with the board, his accumulated contributions standing to his credit in the members deposit fund”. The pages and sections read do not state the tax treatment of that refund or its consequences for service credit.
• The LAGERS pages link to a Cost of Living Adjustments page that was not read, but RSMo 70.655 states the rule: “the amount of the allowance shall be redetermined effective each October first” at “one hundred percent, plus two percent for each full year (excluding any fraction of a year) in the period from the effective date of the allowance to the current October first”, capped by the ratio of the June Consumer Price Index before that October first to the June index before the allowance began, and never below the allowance otherwise payable. If the board, after consulting the actuary, finds the reserves more than sufficient, it may raise the rate, within a four percent annual maximum; from October 1, 1993 both rates are compound rates, compounded annually. If the board determines that these increases are jeopardizing the system’s financial solvency, it must suspend them for such periods as it deems appropriate.
• RSMo 70.660 settles whether the Option A and Option B survivor percentages apply to the Life Option amount or to the reduced payment: the survivor is paid three-quarters (Option A) or one-half (Option B) of the retirant’s reduced allowance.
• RSMo 70.660 gives the PLUS reduction as a formula by retirement age (eighty-four percent at age 60, moving by four-tenths of one percent for each year of age), but the pages read state no worked figure for any other age.
• RSMo 70.640 states the price rule for military service only (the present value of the added allowance, paid over no more than two years with compound interest); the pages read do not state the price or the interest rate for other public employment, for transferred service, or for the 12 and 24 month installments.
• The pages read do not state whether PLUS can be combined with a Life and Temporary plan beyond noting that a temporary allowance is excluded from the lump sum calculation.
• The pages read do not state any spousal consent requirement for the choice of option, and the text of RSMo 70.660 read for this guide contains no spousal-consent clause. LAGERS says an Option C beneficiary can be changed at any time; RSMo 70.660 names that beneficiary by written designation filed with the board and does not say whether it can be changed later.

Common mistakes

• Treating the payment option as changeable after retirement, when the page says the selection made during the retirement process is permanent and cannot be changed.
• Electing Option A or Option B without recognizing that the beneficiary cannot be changed later, and that the pop-up to the Life Option amount also locks the member into the Life Option.
• Forgetting to notify the LAGERS office when a spousal beneficiary dies, since the Pop-Up Provision has to be enacted by that notice.
• Assuming Option C pays a beneficiary for life, when its guarantee is limited to a total of 120 monthly payments.
• Taking the PLUS lump sum without allowing for the 20 percent withholding, the tax on a lump sum that is not directly rolled over, and the early distribution penalty before the stated ages.
• Waiting to ask LAGERS for the official cost of purchased or transferred service until the decision is close.

Related on this site: Missouri retirement taxes, does Missouri tax pensions, single-life versus joint-and-survivor pension, pension buyback calculator and public pension retirement decisions by system.

Sources

• Missouri LAGERS, Payout Options: https://www.molagers.org/members/nearing-retirement/payout-options/
• Missouri LAGERS, Purchasing Service: https://www.molagers.org/members/purchasing-service/
• IRS, Topic no. 413, Rollovers from retirement plans (irs.gov): https://www.irs.gov/taxtopics/tc413
• IRS, Topic no. 558, Additional tax on early distributions from retirement plans other than IRAs (irs.gov): https://www.irs.gov/taxtopics/tc558
• Missouri Revisor of Statutes, RSMo 70.660 and the other chapter 70 sections cited above (read on October 23, 2026): https://revisor.mo.gov/main/OneSection.aspx?section=70.660

Sources: the primary documents linked above, read on October 2, 2026, and the statute sections read on October 23, 2026. General information from each system’s own published materials, not legal, tax or financial advice. Your own member statement and the system’s current rules decide your benefit, and a pension counsellor at the system or a fee-only adviser is the right place to confirm anything consequential.