Updated October 30, 2026. Quick answer: South Carolina SCRS Class Three members (membership on or after July 1, 2012) need at least eight years of earned service. They can retire without reduction when age plus years of service meets the Rule of 90, or at age 65 or older, and at age 60 with a permanent reduction of 5% for each year of age younger than 65. The pension is 1.82% of average final compensation for each year of creditable service. Under the statute, a Class Two member with five or more years of earned service is eligible for service retirement at age 60 or with 28 or more years of creditable service.
Class Three service retirement
The South Carolina Code says a Class Three member is eligible when the member “has: (1) eight or more years of earned service; (2) attained the age of sixty years or satisfied the rule of ninety requirement; and (3) separated from service.” “”Rule of ninety” means a requirement that the total of the member’s age and the member’s creditable service equals at least ninety years.”
Unreduced and reduced retirement
PEBA’s presentation lists two routes to an unreduced monthly benefit: “Must meet the Rule of 90 (age and years of service add up to at least 90)” or “Be age 65 or older”. On a reduced benefit: “For a reduced monthly retirement benefit, you must be age 60 (permanently reduced 5% for each year of age younger than 65).” The statute sets the monthly reduction: “If the member’s service retirement date occurs before his sixty-fifth birthday and before he satisfies the rule of ninety requirement the member’s service retirement allowance is computed as in item (1) of this subsection but is reduced by five-twelfths of one percent”.
Minimum service
PEBA’s one-page Class Three summary says: “You must have at least eight years of earned service to receive a benefit.”
Class Two
The statute sets these conditions for Class Two service retirement: “(1) five or more years of earned service; (2) attained the age of sixty years or has twenty-eight or more years of creditable service; and (3) separated from service.” For early retirement: “a Class One or Class Two member may elect early retirement if the member: (1) has five or more years of earned service; (2) has attained the age of fifty-five years; (3) has at least twenty-five years of creditable service; and (4) has separated from service.” “the member’s early retirement allowance is reduced by four percent a year, prorated for periods less than one year, for each year of creditable service less than twenty-eight.” PEBA adds: “Must be age 55 with 25 years of service (permanent 4% reduction for each year of service less than 28)”. “If eligible for both early retirement options, the option that reduces the benefit the least will be applied.”
What the pension is based on
“the allowance must be equal to one and eighty-two hundredths percent of the member’s average final compensation, multiplied by the number of years of the member’s creditable service.” “(b) “Average final compensation” with respect to Class Three members means the average annual earnable compensation of a member during the twenty consecutive quarters of the member’s creditable service”. “AFC includes 20 highest consecutive quarters of earnable compensation divided by 5.”
A worked example with invented numbers
Take an invented Class Three member with 30 years of creditable service who retires at 65. That is 30 years at 1.82%, or 54.6% (computed) of a final average salary of $60,000 (invented, for the computation), which comes to $32,760 a year (computed).
Now take an invented Class Three member who retires at 60 with 20 years of creditable service. Age plus service is 80, below the Rule of 90, so the early reduction applies, and 60 months before the 65th birthday at five-twelfths of one percent each is the reduction. That is 20 years at 1.82%, or 36.4% (computed) of a final average salary of $60,000 (invented, for the computation), which comes to $21,840 a year (computed). The reduction is 60 months before age 65 at five-twelfths of one percent each, which is 25% (computed). The pension after the reduction is $16,380 a year (computed).
What the documents do not say
PEBA’s materials say eight years of earned service are needed to receive a benefit and never use the word vesting, so the eight years is quoted as the minimum to receive a benefit. The member handbook could not be read, so the sources are the statute, PEBA’s presentation and PEBA’s Class Three summary. Class One, the Police Officers Retirement System and the State Optional Retirement Program are not covered.
Common mistakes
- Reading 90 as an age. It is age plus years of creditable service.
- Applying the Class Two 28-year rule to Class Three. Class Three unreduced retirement is the Rule of 90 or age 65.
- Forgetting that Class Three retirement at 60 is permanently reduced unless the Rule of 90 is met.
Related: South Carolina SCRS retirement decisions, the South Carolina SCRS COLA for 2027, how public pension decisions work, and whether South Carolina taxes pensions.
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Answer againSources
- South Carolina Legislature, South Carolina Code of Laws, Title 9, Chapter 1 (South Carolina Retirement System): www.scstatehouse.gov
- South Carolina Public Employee Benefit Authority (PEBA), Get Set for Retirement: Service retirement and benefit calculation (FY 2027): www.peba.sc.gov
- South Carolina Public Employee Benefit Authority (PEBA), SCRS at a Glance (Class Three): www.peba.sc.gov
- Related official page (not quoted): IRS Tax Topic 410, Pensions and annuities: www.irs.gov
- Related official page (not quoted): IRS Tax Topic 411, Pensions: the General Rule and the Simplified Method: www.irs.gov
Read from the primary documents linked above on October 30, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the IRS itself is the right place to confirm anything consequential.