STRS Ohio Retirement Benefit Calculation

The Core Formula

For Defined Benefit Plan members, your annual retirement benefit is calculated with three inputs:

Years of service credit × 2.2% × Final Average Salary = Annual benefit

Divide by 12 for your monthly Single Life Annuity amount — the maximum monthly pension before any Plan of Payment reductions.

Final Average Salary (FAS)

Your FAS is the average of your five highest years of Ohio public earnings. Not your five most recent years — your five highest. For most career educators approaching retirement, these overlap, but teachers who took a pay cut (moved to a lower-paying district, dropped to part-time, took an administrative role with less compensation) should check which five years the system is using.

Earnings above the IRS Section 401(a)(17) compensation limit are excluded from FAS calculations. For members who joined STRS Ohio on or after July 1, 1996, the limit is $350,000 for the 2025-2026 year and $360,000 for 2026-2027. Most teachers fall well below this cap, but administrators and certain higher education faculty may hit it.

Only Ohio public earnings reported through STRS Ohio count toward FAS. Private school teaching, out-of-state teaching income, and summer employment outside the public system are not included — though out-of-state teaching service credit can be purchased to increase your years-of-service multiplier.

Service Credit: The Other Multiplier

Every year of qualifying service credit adds another 2.2% to your formula. At 30 years, you're at 66% of FAS. At 32 years (the current unreduced retirement threshold), you're at 70.4%. At 35 years, 77%.

This is why service credit purchases matter so much near retirement. Buying back two years of restored refunded service or military time adds 4.4% of your FAS to your annual benefit. On a $70,000 FAS, that's $3,080 more per year — $256.67 more per month, for life.

Qualifying service credit includes Ohio public teaching time, purchased military service, restored refunded service, approved leaves of absence, out-of-state and federal teaching credit, and combined service under OPERS or SERS.

Combined Plan Members: A Different Multiplier

Combined Plan members use a 1% multiplier per year of service for the defined benefit portion — not 2.2%. The defined contribution portion depends on your invested account balance and is calculated separately. At retirement, you can annuitize the DC balance through STRS Ohio or roll it into an external IRA.

A Worked Example

A K-12 teacher with 32 years of service credit and a Final Average Salary of $72,000:

• Annual benefit: 32 × 0.022 × $72,000 = $50,688
• Monthly Single Life Annuity: $4,224

If that teacher works one more year at $74,000 (raising the FAS slightly):

• New FAS (estimated): $72,400
• Annual benefit: 33 × 0.022 × $72,400 = $52,622
• Monthly Single Life Annuity: $4,385

The extra year adds roughly $161 per month. Whether that's worth delaying retirement depends on what you'd earn versus what you'd collect — and whether that year pushes your FAS higher.

What Reduces Your Calculated Benefit

The formula output is your maximum monthly payment. Several elections reduce it:

• Joint and Survivor plans — actuarial reduction to fund beneficiary protection
• PLOP — permanent monthly reduction based on age-specific actuarial factors
• Early/reduced retirement — actuarial reduction for retiring before unreduced eligibility
• Division of Property Orders — court-ordered deductions for a former spouse

Your STRS Ohio retirement estimate shows the formula result and projected amounts under each Plan of Payment. Calculate any PLOP reduction using STRS Ohio's age-based actuarial factor, and ask STRS Ohio whether any Division of Property Order deductions are reflected in your estimate.

Our STRS Ohio Retirement Guide walks through the benefit formula with worksheets for calculating your exact FAS, projecting the impact of additional service years, and comparing the net monthly income across all plan options.

See more Ohio guides →