Public Safety Personnel Retirement System benefits for new members

Arizona’s first responders – police officers and firefighters – have relied on retirement benefits from the Public Safety Personnel Retirement System since 1968. PSPRS is a defined benefit, or pension plan, in which monthly retirement benefits are determined by member salaries and credited service during employment.

These benefits are constitutionally guaranteed in Arizona and adjusted annually for inflation, providing lifetime financial security to nearly 23,000 plan retirees and surviving spouses. Unlike traditional investment-based retirement plans, PSPRS pension benefits are unaffected by stock market fluctuations or economic conditions that can erode retirement savings and income.

Membership tiers, pension contribution rates and benefits in PSPRS are determined by member hiring dates. Law changes passed by the Arizona Legislature created a new third member tier for PSPRS for first responders hired on or after July 1, 2017.

This legislation also created a “hybrid” benefit, in which members contribute towards a defined benefit plan and a defined contribution plan. This benefit, the Public Safety Personnel Defined Contribution Plan, was created for Tier 3 (and Tier 2) members who do not contribute to Social Security through their employers and will not collect Social Security related to their public service in retirement.

These accounts held by plan members and retirees are managed by Nationwide Retirement Solutions and overseen by the PSPRS Defined Contribution Committee, which consists of PSPRS trustees and members of the public safety, corrections and elected officials retirement plans.

All Tier 3 members can also elect to forego receiving pension benefits and contribute solely towards defined contribution benefits.

For additional information, members can review the PSPRS Summary of Plan Provisions.

Public Safety Personnel Defined Contribution Retirement Plan

The PSPDCRP is a retirement plan in which both members and employers make contributions into an individual investment account established for each participant. Member contributions are made on a pre-tax basis and generate an employer matching contribution into a 401(a) account managed by Nationwide Retirement Solutions and overseen by the PSPRS Defined Contribution Committee, which consists of PSPRS trustees and members of the public safety, corrections and elected officials retirement plans.

PSPDCRP participants, including “hybrid” benefit recipients, can allocate contributions to various investment options within their 401(a) account. These options include target date funds, mutual funds, index funds and bond funds. The benefit available to plan members upon retirement is determined by both contributions and investment performance of the funds chosen by participants. Please note that defined contribution plan investors are responsible for choosing their investments and bear the risk of loss of assets caused by market volatility and conditions.

For additional information, participants in the 401(a) plan can visit www.psprsdcplan.com or contacting Nationwide Retirement Solutions by calling 1-855-297-8228 or emailing [email protected] for assistance.

Making the choice

New Tier 3 members have 90 days from their hiring date to elect whether to contribute towards pension benefits through PSPRS or defined contribution benefits through the PSPDCRP or both. This decision, which is irrevocable under most circumstances, must be made through the Members Only portal that new members can access when they receive emailed instructions from PSPRS.

Please note that failure to make a decision will result in new members defaulting to contributing towards a pension or towards the hybrid defined benefit and defined contribution plans, depending on their Social Security status through their employer. Members who qualify for hybrid benefits can also elect to increase their 401(a) contributions during the 90-day election period.

PSPRS has resources to assist new members in making this important decision.

NEW MEMBER VIDEOS