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Teachers’ and State Employees’ Retirement System (TSERS)

The Teachers' and State Employees' Retirement System (TSERS) is sponsored by the State of North Carolina and governed by the Department of the State Treasurer. TSERS is a defined benefit plan. Under this type of plan, the benefit an employee receives at retirement is based on total years of creditable service, age, and "average final compensation," which is the employee's four highest paid consecutive salary years. Neither the investment experience of the plan assets nor the amount contributed directly determines the guaranteed benefit an employee will receive at retirement.

An employee becomes vested in TSERS after completing at least 5 years of membership service. This means that an employee is eligible to apply for lifetime monthly retirement benefits based on the retirement formula in effect at the time of their retirement and the age and service requirements described below, provided the employee’s contributions are not withdrawn.

Service Retirement (Unreduced Benefits)

An employee may retire with an unreduced service retirement benefit after:

  • Reaching age 65 and completing 5 years of membership service
  • Reaching age 60 and completing 25 years of creditable service
  • Completing 30 years of creditable service at any age

Early Retirement (Reduced Benefits)

An employee may retire early with a reduced retirement benefit after:

  • Reaching age 50 and completing 20 years of creditable service
  • Reaching age 60 and completing five years of membership service

If you leave State employment before completing five years of service, you can either request a refund of the retirement contributions you’ve made or keep your contributions in TSERS in case you return to State employment later.

Death Benefit

If an employee dies while still in active service after one year as a contributing member, the employee’s beneficiary will receive a lump-sum payment equal to the employee’s highest salary for 12 consecutive months during the 24 months prior to death. The lump-sum payment will be at least $25,000 but no more than $50,000. This benefit is also paid if an employee dies within 180 days of their last day of service, provided they have not withdrawn their contributions. The death benefit is in addition to any other benefits to which an employee’s beneficiary may be entitled. For this death benefit, an employee may name the same or a different beneficiary than the one(s) named to receive the return of contributions.

Return of Contribution

After death, an employee’s beneficiary can receive a return of the employee’s contributions plus interest at four percent compounded annually on the prior year's ending balance, through the date of death. This is a lump-sum payment. If certain eligibility requirements are met, a monthly Survivor’s Alternate Benefit may be paid to the beneficiary instead of a return of contributions if only one eligible beneficiary is living at the time of death.

Survivor Alternate Benefit

Provided an employee has not retired, the monthly Survivor's Alternate Benefit may be payable if an employee has only one eligible beneficiary for the return of their contributions living at the time of death and dies while in active service or within 180 days of their last day of service after meeting one of the following conditions:

  • Employee completes 20 years of creditable service (not including credit for unused sick leave) regardless of age, or

  • Employee reaches age 60 with 5 years of membership service.

If an employee does not meet one of these two conditions, their beneficiary will be able to receive only a return of the employee's contributions. The Survivor's Alternate Benefit does not apply if an employee has two or more eligible principal beneficiaries for the return of contributions living at the time of death, if their estate or living trust is their eligible beneficiary at the time of death, or if the employee has retired. This lifetime monthly benefit payable to the employee's beneficiary equals the amount the employee would have been entitled to receive under Option 2 of the retirement benefit selection had he or she survived and retired on the first of the month following death.

Employees enrolled in the TSERS retirement plan are allowed one month of credit for every 20 days of unused sick leave, which can serve as creditable service towards retirement eligibility. For any part of 20 days left over, one additional month is allowed, provided the remaining portion is at least one hour. However, to use sick leave toward retirement credit, an employee's last day of service in TSERS must be within 5 years of the employee's effective retirement date.

The North Carolina Department of State Treasurer created ORBIT to allow members enrolled in TSERS convenient access to their retirement account information 24 hours a day, seven days a week. This site enables employees enrolled to view their personalinformation, account information, and other relevant details specific to their retirement system account.

In ORBIT, active employees can:

  • Retire online
  • View contribution history
  • View service credit history
  • View retirement estimates
  • Designate beneficiaries
  • View service purchase cost estimates
  • View NC 401(k)/NC 457 Plan Transfer Benefit estimates
  • View myNCRetirement Statements

To access ORBIT, visit MyNCRetirement.com, click on the ORBIT icon and follow the instructions to log in to your personal ORBIT account.

  1. Register for ORBIT via the Register button on the login page
  2. Follow the prompts for registration
  3. Access ORBIT using the User ID and Password that you created

Employees approaching retirement should review the Retirement Planning Guide. It is recommended that employees contact the Benefits department to schedule an appointment to complete the necessary documents and begin the retirement process approximately 90-120 days before their effective retirement date.

An effective retirement date must be the 1st of a month. Employees can submit their retirement application online through their ORBIT account up to 120 days before their planned retirement date. The application for a monthly retirement benefit must be submitted to the Retirement System for at least 1 day but no more than 120 days before the effective retirement date. For more information about the Online Retirement Process, click here.

Under TSERS, an employee may be eligible to continue health insurance under the North Carolina State Health Plan when retiring and electing to begin their monthly retirement benefit. The cost, if any, is determined by two factors: (1) when state employmentbegan, and (2) which health plan is selected.

If an employee was first hired before October 1, 2006, and retires with 5 or more years of contributory retirement service, the employee will be eligible for health care coverage at no cost under certain plan options.

If an employee was first hired on or after October 1, 2006, to receive health care coverage at no cost, the employee must retire with 20 years of retirement service credit. If an employee has at least 10 but less than 20 years of retirement service credit, the employee is eligible for coverage but will pay 50% of the cost. If an employee has at least 5 years of contributory retirement service but less than 10 years of retirement service credit, the employee is eligible for coverage but will pay 100% of the cost.

In all cases, retirees must pay the full cost of dependent coverage.

If an employee withdraws, transfers, or rolls over their TSERS contributions to an IRA or another employer’s retirement plan, the employee will forfeit their right to the State’s retiree group health plan coverage.

Employees hired on or after January 1, 2021 will not be eligible to receive retiree medical benefits.

All new retirees who are eligible for State Health Plan coverage will be automatically enrolled into a plan at the time of retirement, even if a member did not have Plan coverage as an active employee. If eligible, retiree health coverage begins on the first day of the month following the effective retirement date. For example, if an employee has an effective date of retirement of January 1, his or her coverage in the retiree group plan will begin on February 1.

IMPORTANT: When an employee (or their covered dependents) becomes eligible for Medicare upon retirement, the employee must elect both Part A (Hospital) and B (Medical) to maintain the same level of coverage received prior to retirement.

For additional details about retiree health coverage eligibility and benefit options at retirement, refer to State Health Plan Retiree Benefits and Planning for Retirement.

Over time, the North Carolina General Assembly has enacted and amended laws governing the return-to-work for all retirees of the North Carolina Retirement Systems.

Return-to-work laws apply differently to members of the Local Governmental Employees’ Retirement System (LGERS) and the Teachers’ and State Employees’ Retirement System (TSERS), so before an employee decides to return to work for an employer under the Retirement System from which they retired, he or she should familiarize themselves with the laws governing return-to-work. Retirees are responsible for knowing and abiding by the return-to-work laws that apply to their particular situation.

Violating the return-to-work laws could result in financial penalties, possible loss of retirement benefits, and/or loss of health coverage.

Refer to the TSERS Member Handbook, My NC Retirement, and the State Health Plan Retiree Benefits for additional details about retirement benefits. For questions, employees should contact the Benefits department