Understanding SPPS Pension: Benefits, Eligibility, and Calculation

SPPS Pension
SPPS Pension

Retirement planning is essential for everyone, and as a St. Paul Public Schools (SPPS) employee, it’s crucial to know about the SPPS Pension Plan. The plan provides a reliable source of income for retired SPPS employees, allowing them to enjoy their golden years without worrying about finances. In this article, we will discuss the SPPS Pension Plan’s benefits, eligibility, calculation, and more.

What is the SPPS Pension Plan?

The SPPS Pension Plan is a defined benefit pension plan established by the St. Paul Public Schools District to provide retirement income to eligible SPPS employees. The program is administered by the Minnesota State Retirement System (MSRS) and is funded by contributions from SPPS employees and the District.

Benefits of the SPPS Pension Plan

The SPPS Pension Plan offers several benefits to eligible employees, including retirement benefits, disability benefits, and surviving spouse benefits.

Retirement benefits

The plan provides eligible retired employees with a monthly pension payment based on their Final Average Salary (FAS), years of service, and a multiplier determined by the plan’s formula.

Disability benefits

If an eligible employee becomes disabled before retirement, the plan provides a disability pension payment. The amount of the payment is based on the employee’s FAS and years of service at the time of disability.

Surviving spouse benefits

The plan also provides benefits to eligible surviving spouses of retired employees. The surviving spouse will receive a monthly pension payment based on the retiree’s FAS and years of service.

Eligibility for the SPPS Pension Plan

To be eligible for the SPPS Pension Plan, an employee must meet certain membership and vesting requirements.

Membership requirements

New employees are automatically enrolled in the plan on their first day of employment. Employees can choose to opt out of the plan within the first 30 days of employment.

Vesting requirements

To become vested in the plan, an employee must complete five years of service. Once vested, the employee is entitled to a pension payment upon retirement.

Termination of membership

If an employee terminates their SPPS employment before becoming vested, they will receive a refund of their contributions plus interest. If an employee terminates their employment after becoming vested but before retirement, they can choose to leave their contributions in the plan or receive a lump-sum payment.

Calculation of SPPS Pension Plan benefits (Continued)

The formula used to calculate a retiree’s monthly pension payment is as follows:

Monthly pension payment = FAS x years of service x multiplier

Let’s break down each of these components:

Final Average Salary (FAS)

The FAS is the average salary of an employee’s highest-paid consecutive five years of service. For example, if an employee’s highest-paid five years of service were $60,000, $65,000, $70,000, $75,000, and $80,000, their FAS would be $70,000.

Years of service

The years of service component is the total number of years an employee worked for SPPS while enrolled in the plan.


The multiplier is a percentage determined by the plan’s formula. For example, if the multiplier is 2%, an employee with 30 years of service and a FAS of $70,000 would receive a monthly pension payment of $42,000 x 0.02 x 30 = $25,200.

Example calculation

Let’s say an employee worked for SPPS for 30 years, has a FAS of $70,000, and the plan’s multiplier is 2%. Their monthly pension payment would be $25,200.

Pension plan contributions

Both SPPS employees and the District contribute to the SPPS Pension Plan. The employee contribution rate is currently 7.5% of their gross salary, while the District’s contribution rate is determined by the plan’s actuary.

Plan funding and investments

The SPPS Pension Plan is funded by employee and employer contributions, as well as investment earnings. The plan’s investments are managed by the MSRS Board of Directors, who are responsible for ensuring the plan is adequately funded.

Frequently Asked Questions (FAQs)

How do I change my beneficiaries?

You can change your beneficiaries by completing a beneficiary designation form and submitting it to the plan administrator.

What happens if I terminate my SPPS employment before retirement?

If you terminate your SPPS employment before becoming vested in the plan, you will receive a refund of your contributions plus interest.

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The SPPS Pension Plan provides a reliable source of retirement income for eligible SPPS employees. Understanding the plan’s benefits, eligibility requirements, and calculation formula is essential for retirement planning. By taking advantage of the plan’s benefits and contributing to it regularly, SPPS employees can enjoy a comfortable retirement.

Last Updated on January 6, 2023

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