How does a CalSTRS pension work? A complete guide for California teachers

The 2% at 60 and 2% at 62 formulas, age factors, final compensation, the 2% yearly raise, survivor options, Social Security, health coverage and how to apply.

Rules checked October 18, 2026, against calstrs.com and ssa.gov

2% at 60 or 2% at 62?

CalSTRS (the California State Teachers' Retirement System) covers California public school and community college educators, such as teachers, counselors and administrators. Classified school staff, such as office and custodial workers, are usually in CalPERS instead.

Sources: CalSTRS: Member Handbook 2026, CalSTRS: Benefit enhancements and CalSTRS: Limits. Some educators hired after 2012 stay on 2% at 60 because of earlier membership in another California public retirement system (CalSTRS: Retirement Progress Report glossary), so check your report in myCalSTRS.

The pension formula

service credit × age factor × final compensation = monthly pension

• Service credit is the time you worked in CalSTRS-covered jobs with contributions paid. Unused sick leave turns into extra service credit when you retire.
• Age factor is the percentage you earn for each year of service, based on your age on your retirement date (in months, not just whole years).
• Final compensation is your highest average yearly pay over the period shown above.

Career factor: if you're on 2% at 60 and retire with at least 30 years of earned service, CalSTRS adds 0.2% to your age factor, but the total can't exceed 2.4%.

Longevity bonus: members who earned at least 30 years of service credit by December 31, 2010 get an extra $200 a month for 30 years at retirement, $300 for 31 years, or $400 for 32 or more years. The bonus gets the 2% yearly raise but not the purchasing power payments (CalSTRS: Benefit enhancements).

Age factor table

Source: CalSTRS: Age factor. The 2% at 60 factors don't include the 0.2% career factor. CalSTRS also publishes factors by month, and 2% at 60 members with 30 years can retire as early as 50 at lower factors; the handbook's tables list those.

A worked example

Yearly raises and purchasing power protection

The 2% benefit adjustment. Every September 1 after the first anniversary of your retirement, CalSTRS adds 2% of your starting benefit. It is a simple increase, not compounded and not tied to inflation, and it shows up in the October 1 payment. You must retire before September 1 to get your first raise the next September. For members who retired on or after January 1, 2014, the Legislature cannot reduce it (CalSTRS: Inflation protection).

SBMA purchasing power protection. Because a simple 2% raise falls behind high inflation over time, the Supplemental Benefit Maintenance Account (SBMA) makes extra quarterly payments, in October, January, April and July, to keep your benefit's buying power from falling below 85% of its original value. These payments are not guaranteed and continue only while funds last. Many members who retired more recently get nothing or very small amounts, because their buying power hasn't dropped below 85% yet.

Defined Benefit Supplement and Cash Balance

Defined Benefit Supplement (DBS). If you earn more than one year of service credit in a school year, for example by teaching summer school or extra classes, the contributions on that extra work go into a separate DBS account rather than the regular pension. At retirement, you can take the DBS balance as a lump sum or as an annuity (monthly payments).

Cash Balance Benefit Program. This is a separate CalSTRS plan for part-time and adjunct educators whose districts offer it. You and your employer put money in an account that earns a guaranteed interest rate, sometimes plus extra earnings credits. It vests right away, and its normal retirement age is 62 (CalSTRS: Member Handbook 2026).

Survivor options

The Member-Only Benefit is usually the highest monthly amount and stops at your death; any remaining contributions go to your death benefit recipients. To leave a monthly income to someone, you choose an option and take a smaller check:

With the beneficiary options, if your beneficiary dies first, your check rises to the Member-Only amount. Federal law limits how much younger a non-spouse beneficiary can be for the larger options. You have 30 days from the date your first payment is issued to change or cancel your option (CalSTRS: Electing an option). You can also elect an option before retirement to protect a beneficiary if you die while still working.

Social Security and CalSTRS

CalSTRS members and their employers don't pay Social Security tax on CalSTRS-covered work, so teaching doesn't earn a Social Security benefit. You may still qualify through other jobs (summer work, a second career, military service) or through a spouse (CalSTRS: Social Security).

For decades, two federal rules cut those benefits for people with pensions from non-Social Security jobs. The Windfall Elimination Provision (WEP) reduced Social Security earned from other work, and the Government Pension Offset (GPO) reduced or erased spouse and survivor benefits. The Social Security Fairness Act, signed January 5, 2025, repealed both for benefits payable for January 2024 and later. Social Security paid back amounts and raised monthly checks starting in 2025. If you never applied because WEP or GPO would have wiped out your benefit, you may need to apply now, and back payments are generally limited to six months before the month you apply (SSA: Social Security Fairness Act).

The repeal doesn't change your CalSTRS pension. See Does a pension reduce Social Security? for more.

Health coverage in retirement

CalSTRS does not provide health insurance. Retiree health coverage, if any, comes from your school district or college, and the rules vary a lot by district and contract. Ask your district's benefits office early, and see health insurance before Medicare if you retire before 65 (CalSTRS: My Retirement Benefits).

Medicare. If you and your spouse didn't pay Medicare tax while working, you can buy Medicare Part A at 65. Everyone pays the Part B premium. The CalSTRS Medicare Premium Payment Program pays Part A premiums only for members whose most recent retirement date is before July 1, 2012, who are 65 or older, who don't qualify for premium-free Part A, who are enrolled in Parts A and B, and who meet the employer rules (CalSTRS: MPPP eligibility). Members retiring now don't qualify.

How to apply

Submit the Service Retirement Application through myCalSTRS or on paper, directly to CalSTRS, not to your district. File as early as possible but no earlier than six months before your retirement date. If you file late, your retirement date can be backdated, but since January 1, 2026, no earlier than 270 calendar days before CalSTRS receives your application. Your first payment comes within 45 days of your retirement date, and you have 30 days from that first payment to change or cancel the application (CalSTRS: Service retirement application process).

What to do next

1. Check your Retirement Progress Report. In myCalSTRS, confirm your formula, service credit and DBS balance.
2. Run estimates at two or three dates. A few months can move your age factor, and a 2% at 60 member near 25 or 30 years may gain a lot by reaching them.
3. Ask your district about health coverage. Get the rules in writing, including what happens at 65.
4. Check Social Security. If you have other covered work or a spouse with Social Security, look at your record on ssa.gov now that WEP and GPO are gone.
5. File within six months of your date. Gather birth and marriage documents if you're choosing an option.

General information, not advice. We aren't part of CalSTRS. For an official estimate, use myCalSTRS or call CalSTRS at 800-228-5453.