NMERB Defined Benefit Plan
What is the NMERB Defined Benefit Plan?
The New Mexico Educational Retirement Board (NMERB) is a defined benefit plan. The benefit received upon retirement is defined by a prescribed formula based on years of service, a salary calculation, and an employee's age that may only be altered by the New Mexico State Legislature.
Questions about any of the following can be addressed to:
New Mexico Educational Retirement Board (NMERB)
P.O. Box 26129
Santa Fe, NM 87502-6129
Toll Free 866-691-2345 or member.help@state.nm.us.
Additional information can be found on the NMERB website in the NMERB Handbook
Who is eligible to participate?
All employees at UNM (excluding student employees, resident physicians, post-doctoral employees, and full VA employees) with an appointment of 26% or more are eligible to participate.
Important
As you review NMERB job requirements, please note that NMERB policy language uses FTE and the UNM system of record uses appointment percentage. Example: An appointment of 26% with UNM is equal .26 FTE.
Are you a Temporary or On-Call employee?
Employees hired in On-Call or Temporary positions who are working an appointment of 26% or more per quarter, will be eligible to earn retirement service credits and thus are required to make NMERB contributions. Additionally, as the employer, UNM will be required to contribute the Employer Rate for each of these employees.
Features of the Plan
- Participation in the retirement program is a condition of employment.
- You become eligible to retire when you accumulate enough service credits to qualify for retirement based on the Education Retirement Board rules of eligibility.
- You can use outside (allowed) service at qualifying institutions or military service to help you qualify to retire under this plan. Please contact the NMERB directly for details and how to apply service to your retirement.
- Service Credits are accumulated on a fiscal year, quarterly basis.
- Your retirement benefit upon retirement is a lifetime annuity and has options for survivor benefits.
How to Enroll
Your enrollment in this plan is automatic. No action on your part is needed.
How much do I contribute to the plan?
Employees over $24,000
The employer's (UNM) contribution for employees with an annual wage over $24,000 (equivalent to appointment of 100%) is 18.15% of gross earnings, and the employee's tax-deferred contribution is 10.7% of gross earnings.
Employees $24,000 or less
For employees with an annual wage of $24,000 (equivalent to appointment of 100%) or less, employer contributions are 18.15% of gross earnings, and the employee's tax-deferred contribution is 7.9% of gross earnings.
Rates are subject to change by the New Mexico Legislature.
When can I retire as a member of this plan?
In order to receive an NMERB retirement pension benefit, you must meet one of the following criteria:
NMERB member before July 1, 2010 (Tier 1):- Rule of 75: When your age plus the number of years of earned service credit equals 75 or more
- Age 65 with a minimum of five years of earned credit
- 25 years of earned credit, or a combination of 25 years of earned and allowed service credit
- Rule of 80: When your age plus the number of years of earned service credit equals 80 or more
- Age 67 with a minimum of five years of earned credit
- 30 years of earned credit, or a combination of 30 years of earned and allowed service credit
- Rule of 80: When your age plus the number of years of earned service credit equals 80
- Age 67 if you have a minimum of five years of earned credit
- 30 years of earned credit, or a combination of 30 years of earned and allowed service credit
- Tiers 1, 2 & 3 Annual Benefit Calculation: The annual benefit for Tiers 1, 2, & 3 is equal to 2.35% of the average of the five (5) highest consecutive years of salary multiplied by the number of years of service (earned and allowed credit).
Benefit may be reduced by election of an option that guarantees continuous income to a surviving beneficiary.
The benefit may also be reduced if the member has less than 25 years of service and is less than 60 years of age. - Final Average Salary (FAS) (the average of your highest consecutive 5-year gross salaries) X Years of Service X 2.35% (multiplier set by state statute) = Gross annual benefit/ by 12 = Gross monthly benefit.
- Rule of 80: When your age plus the number of years of earned service credit equals 80 or more; Note: retirement benefit will be reduced when retiring under age 65
- Age 67 with a minimum of five years of earned credit
- 30 years of earned credit, or a combination of 30 years of earned and allowed service credit Note: Soft minimum retirement age of 58: those who retire younger than age 58 with 30 years of service credit will have a reduction in benefits to the actuarial equivalent of the member retiring at age 58
- The benefit for Tier 4 members will be calculated in the same manner as Tiers 1-3 with the exception of the multiplier. The Tier 4 calculation uses a graduated multiplier. The pension factor changes every ten years up to year 30 and then remains at 2.4% thereafter. Allowed service credit is not used to determine eligibility for retirement but is used to calculate retirement benefits. Example: A 30-year career results in a 3.35% multiplier.
| Years of Service | Multiplier |
|---|---|
| 10 or less | 1.35% |
| 10.25 to 20 | 2.35% |
| 20.25 to 30 | 3.35% |
| 30.25 plus | 2.4% |
If I do not retire from UNM, what happens to my NMERB contributions?
Employees who separate from UNM (in a capacity other than retiring from UNM) have three options for their retirement money. Details on these options, along with instructions on how to withdraw your funds, can be found on the Payroll website under the question “When I separate from the University, how do I withdraw my funds?”
The UNM Retirement Process
In order to retire under the NMERB retirement program, you must first verify that you are eligible to retire under the provisions of the plan. To verify your eligibility, contact the Education Retirement Board at 866-691-2345 or email member.help@state.nm.us to request an eligibility date and an estimate of your NMERB pension benefit. Once you have confirmed your eligibility, determine your retirement date* and follow the instructions below.
*Retirement date must always be the first of any month. Faculty on a 9-month academic contract that ends in May must select a July 1 retirement date per New Mexico statute. Faculty on a 12-month contract may retire on the first of any given month of the year.
In addition, you can review Policy 3600, Section 3.6 and 3.7 for UNM retiree benefits eligibility.
1. Contact Benefits & Employee Wellness
At least 90 days prior to your anticipated UNM retirement date contact Benefits & Employee Wellness. A Benefits Representative will walk you through the process and provide you with the information you need to complete the Retirement Application online, the required documentation and any necessary forms. If you are eligible for UNM post-retirement benefits, benefits enrollment forms will be provided to you at the time of your application. Email us at hrbenefits@unm.edu.
2. Notify Your Department
Notify your department, in writing, of your intention to retire and your last scheduled day of employment with UNM. It is advised that you give your department as much notice as possible to ensure a smooth transition into retirement, generally no less than 30 days ahead of your intended retirement date. UNM Faculty who are on a 9-month academic contract are generally required to give at least a semester's notice to their department.