RISING STAR ! The ultimate source to ace your NYPD Sergeant, Lieutenant, and Captain Exam Visit www.RisingStarPromotion.com to subscribe to our mailing list and get info on the next Sgt, Lt. or Captain Exam!

fiftyfouredp · Senior Member

My Tier 3 colleagues, Will you leave at 20?

NauseousPBBN · Senior Member

Its based on Top pay LSA/SSA plus add an additional 5% to that salary amount before calculating pension. Will be more than 8k. Double that for a Lt.

Also, majority will stay the 3 years for escalation. So the real question is 23 or 25. (Unless you have another career lined up then 20 and out).

No1isbetter · Guru

So Im still a bit confused. Is the last year based on Top Pay LSA & additional 5%? Because Im Tier 2, I always planned on 25, but I was hoping someone can break this down a bit better.

Tunit · Senior Member

NauseousPBBN wrote:
Its based on Top pay LSA/SSA plus add an additional 5% to that salary amount before calculating pension. Will be more than 8k. Double that for a Lt.

Also, majority will stay the 3 years for escalation. So the real question is 23 or 25. (Unless you have another career lined up then 20 and out).

I dont think its top pay SDS/LCD plus 5/10/15%, its 5/10/15% of whatever top pay SDS/LCD is at that time will be added to your pension. Just for arguments sake, if youre a Lt and staying 25 years, lets say a top pay LCD gets 180k base. Youd get a 5% bonus of $180k, or an additional $9,000 annually added to your pension.

SturdyHairBag · Member

While having the option to leave with 50% FAS vs 42% FAS at 20 years is definitely good, there are still some significant problems existing with the tier 3 pension:

1) No ITHP
2) No additional 50%
3) Social security offset at age 62, regardless of whether or not the MOS even claims SS at that age
4) No escalation/inflation protection on the 50% FAS pension at 20 years

If we do some basic back of the napkin math here, lets use an example of an MOS who joins at age 22 and retires at age 42 with a $100,000 pension. The day this MOS retires, inflation will begin to peck away at the value of his pension, and since he left prior to securing escalation, we can devalue his pension over a 20-year period with an assumption: Let's use a 3% rate of inflation annually from age 42 to 62. At age 62, the pension has become worth approximately $55,000.

Now, let's estimate the social security benefit at age 62 for an MOS who worked for 20 years and retired. I will use my social security benefit as an example, I retired right around 20 years and my benefit at age 62 (early claiming) is approximately $26,400 per year. So the offset in this particular case would be a reduction in the pension benefit of $13,200.

$55,000 - $13,200 = $41,800 ($3,500 per month) pension at age 62. It doesn't end there. Inflation continues to erode the value of the pension until this individual is in the grave.

Now, on the other hand, let's say this MOS works for 25 years and has full escalation protection on his $100,000 pension. This essentially means that even at age 62, the $100,000 pension has kept up with inflation and was not eroded in value like the first case, being devalued to approximately $55,000. So we still get the social security offset, but it's much more manageable now, reducing our $100,000 pension to approximately $86,800 per year ($7,200 per month - more than 2x the first pension). The benefits don't end there, they continue in reverse as compared to the first pension; while the first pension continues to get devalued over time to inflation, this second pension continues to increase with inflation because of the protection a lifetime escalation benefit affords the MOS.

A lot of tier 3 guys are going to have to ask themselves just how badly they want to run out the door at 20 now, and understand exactly what they'll be forfeiting for the luxury of leaving at 20.... And let me tell you, it is a luxury!

-- Edited by SturdyHairBag on Saturday 10th of May 2025 12:52:31 AM

NauseousPBBN · Senior Member

Tunit wrote:
NauseousPBBN wrote:
Its based on Top pay LSA/SSA plus add an additional 5% to that salary amount before calculating pension. Will be more than 8k. Double that for a Lt.

Also, majority will stay the 3 years for escalation. So the real question is 23 or 25. (Unless you have another career lined up then 20 and out).
I dont think its top pay SDS/LCD plus 5/10/15%, its 5/10/15% of whatever top pay SDS/LCD is at that time will be added to your pension. Just for arguments sake, if youre a Lt and staying 25 years, lets say a top pay LCD gets 180k base. Youd get a 5% bonus of $180k, or an additional $9,000 annually added to your pension.

I see what youre saying, its only an added benefit but using your example it would be $4,500 more to pension not $9,000. The 5/10/15% is added to top pay and then the 50% pension is applied.

An example showing this was written into bill.

"For example, a Detective who retires with 32 years of uniformed NYPD service would receive an increase in their annual pension of approximately $7,476 (a 50% annual benefit of 10% multiplied by the highest-grade detective pay of $149,518)."

Sounds much less appealing.

TransitCop · Senior Member

If you planning to stay home and do nothing then for sure stay 25 but if you going to have another career 20 and out. 5 years of my life in the 40s worth more then in my 50s. Too much out there to be staying and waiting to live.

PoDoNothing · Member

The escalation isnt a guarantee its voted on every 2-3 years and they can vote to take it away.

fiftyfouredp · Senior Member

This to me is what the 457 and 401k are for; supplementing your pension when you do reach SS age. Sure, you can give up 5 years in your 40s to secure a better pension in your 60s, but if you have been contributing to your deffered comp and let it sit for 2 decades you should be good to go. I mean you SHOULD have millions in it by that point.

I would rather have my 5 years of freedom with relative youth, but thats just me. I am in a good spot as well and am still planning to run out the door. Plus, as you can see from this discussion, no one actually knows what this pension enhancement thing is or how its calculated. Things like this make me want to just take my money and gtfo, fuck hoping it works out a certain way, fuck calling the union and having some random blowjob swear up and down this is definitely how it is.

-- Edited by fiftyfouredp on Saturday 10th of May 2025 02:23:41 PM

-- Edited by fiftyfouredp on Saturday 10th of May 2025 02:44:07 PM

Brendan_Mac_17 · Newbie

Plan on leaving at 20 at age 41(have 7 now, almost 2 as a sergeant).

All valid points on staying for 25, but my rational:

1. Have hit deferred comp hard since day 1. I plan on using my deferred comp to
Maintain the spending value of my pension. Ive been close to or have maxed it out every year. Ill have a nice amount when its done (get out of the pre fixed funds!)

2. Bought my house with 5.5 on. Throwing extra money at the principle every month. Goal is to have it close to, if not totally paid off at 20. Once the house is paid off my biggest expense is done

3. Dont plan on starting a 40 hour a week security job the week after I retire but Ill do something part time and have some money coming in. An extra 5 years in my 40s of nights, last minute details, working holidays, etc. just doesnt do it for me.

To each their own

22andOut · Veteran Member

Everyones situation is different. Me personally, I would much rather leave at 20 and spend time with my kids while theyre young. These are the years of their lives I will never get back. Your kids will never again be 7,8,9,10,11 etc.
What is the point of all that money in your 60s and 70s? Ive learned to live within my means. People have different priorities..some need that 100k car every 3 years. To me, being able to attend every family gathering, every practice, every school play is way more important than what my pension looks like in my old age.
But thats just me, and Im sure many will do 25.

PD2FD · Guru

22andOut wrote:
Everyones situation is different. Me personally, I would much rather leave at 20 and spend time with my kids while theyre young. These are the years of their lives I will never get back. Your kids will never again be 7,8,9,10,11 etc.
What is the point of all that money in your 60s and 70s? Ive learned to live within my means. People have different priorities..some need that 100k car every 3 years. To me, being able to attend every family gathering, every practice, every school play is way more important than what my pension looks like in my old age.
But thats just me, and Im sure many will do 25.

You now have to change your moniker to 20 and out

Chickensurprise33 · Member

Amen to that ! Well said

28approved · Veteran Member

Really comes down to sacrificing 5 years to this job for pension boost or taking the first exit and setting with your FAS at 50%. Just know the COLA over time will significantly help your pension. Its good to have options though. They trying to create incentives to stay past 25 years. Prior to this there really was no incentive to stay past 25. With the boost of 5% at 25, 10% at 30 & 15% at 35 years. In my opinion doing 25 still is the most anyone should do to get cola escalation.

Jopagocks · Veteran Member

28approved wrote:
Really comes down to sacrificing 5 years to this job for pension boost or taking the first exit and setting with your FAS at 50%. Just know the COLA over time will significantly help your pension. Its good to have options though. They trying to create incentives to stay past 25 years. Prior to this there really was no incentive to stay past 25. With the boost of 5% at 25, 10% at 30 & 15% at 35 years. In my opinion doing 25 still is the most anyone should do to get cola escalation.

COLA and escalation are the same thing?

Thecolikesmen · Member

Just do 100 years for 100%. At some point you have to draw the line. It was nice for them to think of the sick people who actually stay until they age out on this job.

NauseousPBBN · Senior Member

COLA and Escalation are different. Need to do 3 yrs for full escalation. So 23 yrs. You now have the option to stay until 25 for the enhancement but it looks like its only about 6k (Lt) more on your pension. Not worth it in my opinion.

28approved · Veteran Member

Cola and escalation are separate. You want the cola to keep up with inflation though someone who retired in 2012 for example when top pay for cop was 70 something that pension is not keeping up with inflation. Cola would help with that boosting pension every year by certain % to keep up with inflation. To help it hold its value.

PoDoNothing · Member

Does anyone know if tier 3 gets the 1/60 like tier 2 does?

Jibberjab · Senior Member

Was the social security offset corrected in that last bill that was signed? Saw it floating around that it was but not sure if that was legit.

PoDoNothing · Member

No its not fixed

fiftyfouredp · Senior Member

NauseousPBBN wrote:
COLA and Escalation are different. Need to do 3 yrs for full escalation. So 23 yrs. You now have the option to stay until 25 for the enhancement but it looks like its only about 6k (Lt) more on your pension. Not worth it in my opinion.

Easy cowboy. I took a look at the Tier 3 pension pdf and it says full escalation at 25 year anniversary, with partial starting at 22 anniversary. Very doubtful this has changed with the 20 year option back.

Tier3scum · Senior Member

I saw something about the social security fairness act being signed into law. But not sure if that affects us or its federal workers. It mentioned firefighters police teachers. Even when you google NYPD social security offset, the fairness act is mentioned. But I just didnt see anything concrete so Id imagine it still hasnt passed for us

Jopagocks · Veteran Member

fiftyfouredp wrote:
NauseousPBBN wrote:
COLA and Escalation are different. Need to do 3 yrs for full escalation. So 23 yrs. You now have the option to stay until 25 for the enhancement but it looks like its only about 6k (Lt) more on your pension. Not worth it in my opinion.
Easy cowboy. I took a look at the Tier 3 pension pdf and it says full escalation at 25 year anniversary, with partial starting at 22 anniversary. Very doubtful this has changed with the 20 year option back.

Saw this as well. Escalation is build from years 22 to 25. For every month you stay after 22 you earn 1/36th escalation. Im still confused about COLA. Do we have to earn it, or is it not even available to tier 3?

Testtakertastetester · Member

Jopagocks wrote:
fiftyfouredp wrote:
NauseousPBBN wrote:
COLA and Escalation are different. Need to do 3 yrs for full escalation. So 23 yrs. You now have the option to stay until 25 for the enhancement but it looks like its only about 6k (Lt) more on your pension. Not worth it in my opinion.
Easy cowboy. I took a look at the Tier 3 pension pdf and it says full escalation at 25 year anniversary, with partial starting at 22 anniversary. Very doubtful this has changed with the 20 year option back.
Saw this as well. Escalation is build from years 22 to 25. For every month you stay after 22 you earn 1/36th escalation. Im still confused about COLA. Do we have to earn it, or is it not even available to tier 3?

COLA is only for ordinary and accidental retirement for tier 3. Plus it only applies for the first 18k

fiftyfouredp · Senior Member

So basically its 20 or 25, nothing worthwhile for leaving between those years.

NauseousPBBN · Senior Member

That pdf file hasn't been updated. It clearly still says 22 years for normal retirement.

As stated above COLA was for Tier 2 and Tier 3 ODR and ADR. A normal Tier 3 person qualifies for Escalation, which takes 3 full years to get the full amount. I think it safe to say that once they update that file, it will say years 20-23.

NauseousPBBN · Senior Member

The social security fairness act does not apply to nypd. The bill to correct the offset is submitted every year. Unions have expressed fighting to correct the offset later when more ppl will be affected.

Half tier 3 don't even know about the offset. Hands down the worst part of tier 3.

Truthseeker · Guru

Idk nauseous about worse part. No ithp and 50 percent is probably the worse part. Guys w 20 years on as cops have 400k overages if done in beginning

Tier3scum · Senior Member

It does suck not having ITHP and 50/50. But you know what, cant miss what you never had. When you see your pension get lowered at an age when you dont wanna work anymore. Thats a major kick in the dick. Something you earned is lowered by something you paid into your entire life. How does it make sense.

-- Edited by Tier3scum on Monday 12th of May 2025 09:15:13 PM

Testtakertastetester · Member

Tier3scum wrote:
It does suck not having ITHP and 50/50. But you know what, cant miss what you never had. When you see your pension get lowered at an age when you dont wanna work anymore. Thats a major kick in the dick. Something you earned is lowered by something you paid into your entire life. How does it make sense.

-- Edited by Tier3scum on Monday 12th of May 2025 09:15:13 PM

Agreed. That 8.25% interest for ITHP and 50/50 is great but tier 3 guys can put more in 457/401 to try and match that. The offset is actual money that will come out of tier 3 pockets.

-- Edited by Testtakertastetester on Monday 12th of May 2025 09:25:21 PM

fiftyfouredp · Senior Member

I really do hope Im wrong, but just the wording for the Escalator is giving me bad vibes. They dont say 3 years after service retirement, they say 25th anniversary. Also, this law is just allowing us to leave at 20 with 50% of FAS, nothing about any other dates being moved. At least the VSF is still 20 years.

NauseousPBBN · Senior Member

Moving the retirement to 20 but leaving the rest at 25 makes absolutely no sense and defeats the whole purpose on trying to make the job competitive to others.

Truthseeker · Guru

Let me give you a different perspective. 20 year retirement helps w getting ppl to sign up for job. Yes it prob makes ppl leave at 20 as well. The 25 30 35 should help keep that part in check. So its kinda a win for all in my view

Tier3scum · Senior Member

Hopefully this PC and upper execs on this job all leave sooner than later. But if youre tier 3 and were gonna leave at 22 and now are staying over 30 for this little percentage raise. Please let me know so I can personally drive you to lefrak to make sure youre ok

-- Edited by Tier3scum on Tuesday 13th of May 2025 02:16:19 PM

Jibberjab · Senior Member

Besides being able to retire at 20 years again, I think the only other benefit of this change would be if you wanted to stay a little longer the 1/60th start after 20 and not 22

PoDoNothing · Member

Tier 3 gets 1/60th?

22 and a half and out · Member

I dont think 1/60 was added to tier 3

Jibberjab · Senior Member

Ah man really? Wow so there really is not much incentive to stay past 20

Jopagocks · Veteran Member

Jibberjab wrote:
Ah man really? Wow so there really is not much incentive to stay past 20

Id say if youve been crushing the 457 and 401k best you can, then 20 and out. Otherwise, consider staying 25.

fiftyfouredp · Senior Member

Truthseeker wrote:
Let me give you a different perspective. 20 year retirement helps w getting ppl to sign up for job. Yes it prob makes ppl leave at 20 as well. The 25 30 35 should help keep that part in check. So its kinda a win for all in my view

Exactly ^

Jibberjab · Senior Member

Jopagocks wrote:
Jibberjab wrote:
Ah man really? Wow so there really is not much incentive to stay past 20
Id say if youve been crushing the 457 and 401k best you can, then 20 and out. Otherwise, consider staying 25.

Yea but 5% for 5 extra years. Thats like 10k a year if you are making 200k. For 5 years that aint worth it to me.

DeptIsaJoke · Veteran Member

I'm pretty certain cola is written in our agreement to be up 3 percent, not actually or guaranteed 3%. So it can change yearly based on what the city feels like paying. Does anyone know the % they paid the last 10 year's?

-- Edited by DeptIsaJoke on Wednesday 14th of May 2025 01:49:04 PM

22 and a half and out · Member

Cola is only applied to the first 20k of your pension.
It turns out to be couple hundred bucks a year

DeptIsaJoke · Veteran Member

If that's true 20 and out.

Jets5646 · Newbie

You're confusing COLA and escalation. Escalation is based off the CPI and maxes out at 3% on the entire pension. Issue is that escalation has never been officially calculated yet since no one is eligible for it for a few more years. It can be 0% but should average 2-2.5% a year. You get the full amount at 25 years. It ends up being a lot of money in the long run, 20-25 years down the road the pension can potentially double. It could also go up only 50%. It's impossible to know. We get COLA at 20. But its just a few hundred dollars a year.

-- Edited by Jets5646 on Wednesday 14th of May 2025 02:34:12 PM

Testtakertastetester · Member

Look up COLA and escalation here for Tier 3 if you want accurate info:

www.nyc.gov/assets/nycppf/downloads/pdf/Tier%203%20SPD%2020241029.pdf

It hasn't been updated yet to reflect the 20 year retirement but this is from the Pension Fund so it's as official as it gets.

fiftyfouredp · Senior Member

Called Pension section today, got sent to voicemail. Then Labor relations picked up and I got told they have no idea how the pension enhancement works exactly. Then theres the whole no ones ever had escalation so we have no idea what will happen spiel. The info I got from them was that the social security offset might not be fixed because they added this stuff to compensate for it. Then again no one knows shit, but it makes sense to me. I honestly thought theyd fix the offset first, and the 20 yr returning was a pipedream, but I was proven wrong. If more people jump on the job now because 20 and out is back, whats the incentive for them to fix the offset?

sgt4eva · Member

codelibrary.amlegal.com/codes/newyorkcity/latest/NYCadmin/0-0-0-216126

See d(1)-(3) for language on the 5%/10%/15%
Looks like it bumps salary then you calculate FAS.

NauseousPBBN · Senior Member

If you assume top pay LSA at 250k. They take 5% of that (12,500) apply it to two of the yearly salary, then apply 50% pension. So we talking about 8kish more in pension. I dont know if that's worth it to stay extra 2 years to 25. (assuming escalation will be at 23 now)

For PO's they get two of three years calculated as top pay 3rd grade detective. If that was the case, then it would def be worth staying to 25.