Updated October 30, 2026. Quick answer: Eligibility in the Employees Retirement System of Texas depends on when a member started state work. Group 1 members can retire at age 60 with five years of service credit or under the Rule of 80. Groups 2 and 3 vest at 10 years and can retire under the Rule of 80, with a 5% cut for each year before 60 (Group 2, capped at 25%) or before 62 (Group 3, no cap). Group 4 is a cash balance plan with five-year vesting.
Which retirement group you are in
“In 2009, 2013 and 2021, the Texas Legislature changed retirement benefits and eligibility requirements for new employees at State of Texas agencies.” ERS puts members in Group 1 if they started before September 1, 2009, Group 2 from September 1, 2009 to August 31, 2013, Group 3 from September 1, 2013 to August 31, 2022, and Group 4 on or after September 1, 2022. ERS says a member who withdrew their account and later returned to state employment is placed in the group of the date they returned.
The Rule of 80
“If your age plus your years of eligible service credit equal 80, you can retire under the “Rule of 80.””. The older ERS handout words it: “Rule of 80: Your years and months of service credit (at least five years) and your years and months of age equal or exceed 80.”
Group 1: age 60
An ERS handout from 2014 lists: “Age 60 with five years of service credit (without insurance benefits).”
Vesting
An ERS handout from 2014, written for members who began state service before September 1, 2009 (Group 1), says: “If you worked more than five years and did not take a withdrawal of your retirement account, you are vested for retirement benefits.” For Group 2: “As a Group 2 member, you become vested to receive an ERS retirement annuity when you have 10 years of eligible service credit working for a Texas agency and contributing to your ERS retirement account.”
Retiring before the age cutoff
ERS’s Group 2 example, a member aged 58 with 22 years of service credit, reads: “Because she meets the Rule of 80, she can retire; however, her monthly retirement payment will be reduced 10% if she retires now (5% for each year before age 60, up to a 25% reduction).” For Group 3: “If you retire prior to the age of 62, your annuity will be reduced by 5% every year under age 62 with no maximum.”
Group 4: the cash balance plan
The Group 4 handout says a member can retire when they “meet the Rule of 80, when your age (in years and months) plus your years and months of service credit equal 80”, or when they “are age 65 and have at least five years of service credit”. “You will be fully vested in your retirement account after contributing to it for five years while you work for a participating state agency.” “The state will match 150% of your account balance (including the interest earned and any gain sharing) throughout your career.”
What the pension is based on
For Groups 1, 2 and 3: “Service percentage is determined by multiplying your years and months of service by a “multiplier” (2.3% or 0.023).” Group 3: “ERS will use the average of your highest 60 months of salary; this does not include overtime pay or one-time merit bonus pay.” Group 2: “ERS will use the average of your highest 48 months of salary; this does not include overtime pay or one-time merit bonus pay.”
A worked example with invented numbers
Take an invented Group 3 member with 25 years of service credit who retires at the age cutoff. That is 25 years at 2.3%, or 57.5% (computed) of a final average salary of $60,000 (invented, for the computation), which comes to $34,500 a year (computed).
What the documents do not say
The Group 1 rule of age 60 with five years is quoted from a 2014 ERS handout, because the July 2026 booklet shows it only in a table cell. The age 65 with 10 years route for Groups 2 and 3 appears in the booklet mainly in its tables and in a service-credit note, not in a sentence of its own. ERS’s eligibility web page shows its rules as short table cells rather than sentences. The Group 4 annuity has no years-of-service multiplier. Law enforcement and custodial officers, elected officials and judicial plans are not covered.
Common mistakes
- Using one start date for everyone. The booklet sets four groups by start date, and the reductions and vesting differ.
- Reading the Group 3 cut like the Group 2 cut. Group 3 loses 5% a year under age 62 with no maximum, while Group 2 loses 5% a year under 60 up to 25%.
- Expecting a multiplier in Group 4. The cash balance plan pays from the account and a state match.
Related: Texas ERS retirement decisions, the Texas ERS COLA for 2027, how public pension decisions work, and whether Texas taxes pensions.
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Answer againSources
- Employees Retirement System of Texas, ERS Retirement Groups: ers.texas.gov
- Employees Retirement System of Texas, Preparing for Your Retirement: ers.texas.gov
- Employees Retirement System of Texas, Am I Eligible to Retire?: www.ers.texas.gov
- Employees Retirement System of Texas, State of Texas Employees Earn Lifetime Retirement Benefits (Group 4): ers.texas.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.