Money Purchase Annuity

The Money Purchase Annuity method uses the total amount of deductions withheld from your salary and the amount of City contributions that have been applied to your account. As previously noted, an employee has 6.5% of his salary deducted each pay period for his own annuity. In addition, the city contributes an amount equal to 6.0% of salary.

Money Purchase Annuity Calculation

When an eligible employee retires, the total amount of earned credit is used to purchase an annuity. If an employee retires under age 60 with less than 20 years of service, the amount of City contributions is reduced by 10% for each year of service under 20 years. The annuity payments begin no earlier than age 55.

If retirement is due to expiration of ordinary disability credit, the full amount of City contributions are utilized to determine the annuity. The annuity payments begin after the last disability payment regardless of age.

The maximum allowable annual Money Purchase Annuity is 60% of your highest annual salary.