NM Educational Plan (NMERB)

The NM Educational Retirement Plan is provided by the New Mexico Educational Retirement Board (NMERB).

Eligibility

nmerb_logoEmployees working more than 10 hours per week (.25 FTE) (excludes graduate assistants and student employees). Eligible employees automatically become a member of the Educational Retirement Board (ERB) plan when they begin employment with any entity covered by the Educational Retirement Act (ERA). Membership in the ERB is a condition of employment. Upon employment, the ERB creates an individual account for the employee. Contributions toward retirement are deducted from the employee’s earnings each pay period automatically. All new hires are required to complete an ERB Beneficiary form and the Employee Data form. NMERB Changes Effective July 1, 2014

  • Employees earning $20K or less contribute 7.9% of gross salary by payroll deduction and the university contributes 13.9%. [For more information on this, please refer to 2009 House Bill 2, which stated “For purposes of the General Appropriation Act of 2009 and any other act of the first session of the forty-ninth legislature, no employee shall be deemed to have an annual salary greater than twenty thousand dollars ($20,000) unless the employee’s full-time-equivalent base annual salary is greater than that amount or unless the employee’s base hourly wage is greater than nine dollars fifty-seven and nine-tenths cents ($9.579).”]
  • Employees earning more than $20K contribute 10.7% and the university contributes 13.9%.

Individuals who work more than 0.25 of FTE (25% of Full Time Equivalent) for the following entities are covered by the ERB’s retirement programs:

  • Public schools (including public charter schools, i.e: chartered by the local school board or the New Mexico Secretary of Education)
  • Universities
  • Junior or community colleges
  • Public technical and vocational institutions
  • New Mexico School for the Deaf
  • New Mexico School for the Visually Handicapped
  • Regional educational cooperatives
  • New Mexico Activities Association

Retirement Eligibility

Foster_Hall_ArchEmployees hired before July 1, 2010 may retire when ONE of the following conditions are met:

  1. age 65 with 5 or more years of service; or
  2. when age plus years of service equal 75 (penalties apply for retirees under age 60); or
  3. any age with 25 years of service.

Employees hired on or after July 1, 2010 may retire when ONE of the following conditions are met:

  1. age 67 with 5 or more years of service; or
  2. when age plus years of service equal 80 (penalties apply for retirees under age 65); or
  3. any age with 30 years of service.

Employees hired on or after July 1, 2013 may retire when ONE of the following conditions are met:

  1. age 67 with 5 or more years of service; or
  2. when age plus years of service equal 80 (penalties apply for retirees under age 65); or
  3. 30 years of service; permanent actuarial reduction of benefit if begin receiving benefit before age 55.

Benefits are based on three components – your Final Average Salary (FAS), your years of both earned and allowed service credits, and the 2.35% factor.

FAS  x  service credit  x  .0235 = gross annual benefit

Your final average salary is the higher of:

  1. Your average annual earnings for the last 20 calendar quarters (60  months) prior to retirement, or
  2. Your highest average annual earnings for any 20 consecutive calendar quarters.

As part of the FAS calculation, your average annual earnings are based on quarterly earnings but will be annualized by fiscal year. Request an official estimate of retirement benefits from the NMERB at least 6 months prior to retirement, but no more than 1 year before retirement. The request for estimate form can be found at: http://www.nmerb.org/Downloadable_Forms.html.

Individuals planning for retirement before 55 years of age should consult with their tax advisor as additional penalties may apply.

The plan has special provisions for out-of-state credit and military credit. Please contact the New Mexico Educational Retirement Board for plan details at www.nmerb.org/. For updated ERB News, please visit the newsletter website at http://www.nmerb.org/News_letters.html.

Forms/Handouts/Info:

Newsletters:

Termination Before Retirement

If an employee terminates employment prior to retirement eligibility the following options are available:

  • Do nothing and the contributions will remain with the NMERB.
    • Additional service credit will be added if the employee resumes eligible employment with an ERB employer. (For ERB employers, see http://www.nmerb.org/Membership.html)
    • Retire from the ERB when the employee meets retirement eligibility requirements. A minimum of 5 years of service is required.
  • Refund/rollover the employee contributions. Employer contributions are not placed in the member’s account and are not refundable to a member. (see NMERB Refund information at http://www.nmerb.org/Refund_information.html)

NMSU Policy Reference: 7.15 Insurances