Defined Benefit Plan

How Does It Work?

The Defined Benefit Plan is a comprehensive plan that provides benefits during your teaching career and in retirement. Under the Defined Benefit Plan, your retirement income is determined by a calculation that uses:

  • Your age,
  • Your years of service, and
  • Your final average salary (FAS) — the average of your five highest salary years.

Contribution rates:

  • Members currently contribute 14% of annual salary.
  • Employers currently contribute 14% of payroll.
  • Contribution rates are established by law and the State Teachers Retirement Board and are subject to change.

STRS Ohio manages assets in the Defined Benefit Plan. You are not responsible for making investment decisions. This can be an ideal plan for career educators.

Defined Benefit Plan participants are not eligible to reselect their plan during their fifth year of membership.

Graphic of an exclamation point in a circle.

What This Means for You

With the Defined Benefit Plan, your monthly benefit is predictable — it does not depend on you managing investments.

Benefits While Teaching

STRS Ohio’s Defined Benefit Plan provides comprehensive benefits and services beyond funding your monthly income during retirement. These include:

Portability

If you leave Ohio public employment before you’re eligible to retire, you have the flexibility to withdraw your retirement assets or leave your STRS Ohio account intact to qualify for future benefits. Your STRS Ohio contributions plus interest can be refunded or rolled over to a traditional individual retirement account (IRA) or another qualified retirement plan. After you earn five years of qualifying service credit, interest plus a 50% match on your contributions and interest is paid on funds withdrawn or transferred.

Survivor Benefits

Upon earning five years of service credit, qualified survivors are eligible to receive annual benefits that range from 25% to 60% of your final average salary if you should die before retirement. Survivors receiving this benefit have access to health care coverage (medical/prescription, dental and vision)* through STRS Ohio.

Disability Benefits

With 10 years of service credit, you may apply for monthly disability benefits if you become disabled while employed or within one year following your last date of STRS Ohio-covered service. Annual benefits range from 45% to 60% of your final average salary. Access to health care coverage (medical/prescription, dental and vision)* is also available.

Service Credit Purchase

You may be eligible to purchase additional service credit for many types of past employment. This may increase your retirement benefit or enable you to retire sooner.

*Coverage under the STRS Ohio Health Care Program is not guaranteed. STRS Ohio may change or discontinue all or part of the program for all or a class of eligible benefit recipients and covered dependents at any time.

Benefits While Retired

Retirement Income

Members receive 2.2% of their five-year final average salary for each year of service credit. For example, with 35 years of service credit, you would receive 35 x 2.2% = 77% of your final average salary (average of your five highest salary years). You are eligible for a benefit at age 65 with five years of service or any age with 34 years of service. The service credit requirement for unreduced benefits at any age will increase to:

  • 35 years on Aug. 1, 2023
  • Beginning Aug. 1, 2026, members must be age 60 with 35 years of service to receive an unreduced benefit.

Your retirement income is based on a formula:

Years of service x 2.2%
X
Final average salary
=
Annual Benefit
35 x 2.2 = 77%
X
$80,000
=
$61,600 annually

You can retire early with an actuarially reduced benefit at age 60 with five years of service or age 55 with 29 years of service. Members can also retire early with a reduced benefit at any age with at least 30 years of service.

Access to Health Care Coverage*

You and your eligible dependents will have access to health care coverage (medical/prescription, dental and vision) through STRS Ohio. Beginning Aug. 1, 2023, new retirees will need 20 years of service for eligibility.

*Coverage under the STRS Ohio Health Care Program is not guaranteed. STRS Ohio may change or discontinue all or part of the program for all or a class of eligible benefit recipients and covered dependents at any time.

Summary

  • With the STRS Ohio Defined Benefit Plan, you receive a monthly benefit payment based on your age, years of service credit and final average salary — not prevailing market conditions — and access to health care coverage if you meet health care eligibility requirements. This plan may be the best choice for career educators.
  • You are not responsible for making investment decisions.
  • Benefits while you are teaching include survivor and disability benefits.
  • If you choose the Defined Benefit Plan now, your decision is permanent. You will not have an opportunity to change STRS Ohio plans at a later date.
  • You can compare this plan with your other STRS Ohio retirement plan options in the Retirement Plan Comparison Chart.