VCERA is funded by investment earnings, employee/member contributions and employer contributions. Together, these funding sources enable VCERA to offer its members retirement benefits that last a lifetime.
Although employee contributions have no impact on the calculation of your monthly retirement benefit, they are an essential element of the retirement system. They are also critical to your membership—as long as your retirement contributions are on deposit, you remain a member of VCERA.
Contributions are deducted from your biweekly pay on a pre-tax basis* and credited to your retirement account. Your exact contribution amount in a pay period will depend on your assigned contribution rate, as determined by VCERA’s actuary, and your total pensionable pay (base salary plus qualifying pay items). This pay is referred to as “compensation earnable” for Legacy members and “pensionable compensation” for PEPRA members.
Certain members will make additional retirement contributions to help fund their cost-of-living adjustments (COLAs) in retirement. For example, County employees represented by SEIU and CNA also contribute 2.63% of their pensionable earnings per pay period toward their future COLA benefits.
Biweekly deductions will continue throughout employment for most members. However, Safety Tier 1 members who reach 30 years of continuous service will no longer contribute to VCERA. Also, the retirement contributions of certain employee group members are “picked up” by their employer in lieu of wages, pursuant to negotiated agreements. If this applies to you, the employer-paid contributions will be credited to your account biweekly. Interest is credited to the individual accounts of all members semiannually on June 30 and December 31.
Members may not withdraw their retirement contributions as active members or while reciprocity is in effect. Additionally, contributions cannot be loaned to members or withdrawn for financial hardship. By withdrawing contributions after terminating employment, a member severs membership and forfeits all claims to VCERA benefits.
Employer contributions are also made to VCERA each pay period to help grow VCERA’s investment portfolio and pay retirement benefits. These contributions are based on a percentage of payroll, as determined by VCERA’s actuary, but they are not assigned to individual member accounts.
Annual Benefit Statements
Every spring, VCERA will send you a personalized benefit statement that includes a summary of your annual contributions, employer pickup (if applicable), credited interest and accrued retirement service credit.