FRS glossary

AFC (Average Final Compensation)

The average of the highest-paid years of compensation used to calculate your FRS pension. For pre-2011 enrollees, the highest 5 years are averaged. For post-2011 enrollees, the highest 8 years are averaged. Compensation includes base salary, qualifying overtime, and supplemental pay.

Related: Multiplier, Years of Service

Multiplier

The percentage of AFC earned per year of creditable service. For FRS Special Risk Class members, the multiplier is 3% per year. For Regular Class members, the base multiplier is 1.6% (with small increases at higher ages and service years not modeled in this tool). The pension formula is: Years × Multiplier × AFC.

Related: AFC, Special Risk Class, Regular Class

Special Risk Class

A membership class in the Florida Retirement System for firefighters, law enforcement officers, correctional officers, probation officers, and paramedics/EMTs. Special Risk members earn benefits at a higher 3% multiplier and have lower normal retirement thresholds than Regular Class members.

Regular Class

The membership class in the Florida Retirement System covering most public employees who are not in Special Risk, SMS, or Elected Officers’ roles — for example, teachers, state employees, county employees, and university staff. Regular Class members earn a base 1.6% multiplier per year of service and reach normal retirement later than Special Risk members (age 65 with 8 years of service, or 33 years of service regardless of age, for post-2011 enrollees).

DROP (Deferred Retirement Option Program)

A program that allows eligible FRS members to retire on paper while continuing to work. The pension benefit is locked in at DROP entry — your monthly amount is calculated based on your service and AFC at that point and does not increase during the DROP period. Each month the pension accumulates in an interest-bearing account. At DROP termination, the member receives the accumulated lump sum and begins drawing the monthly pension. As of 2023 legislation, DROP can last up to 96 months.

Related: Lump Sum, COLA

COLA (Cost of Living Adjustment)

An annual adjustment to the pension benefit. For FRS members, COLA only applies to service earned before July 1, 2011. The proration formula is: (pre-2011 years / total years) × 3%.

Benefit Payment Option

The FRS Pension Plan offers four benefit payment options (Option 1 through Option 4) that determine both your monthly benefit amount and what continues to a beneficiary or joint annuitant after your death. Option 1 pays the full unreduced amount for your lifetime with no continuing monthly payment. Option 2 pays nearly the same amount with a 10-year guarantee. Options 3 and 4 pay a reduced amount for your lifetime, with a joint annuitant receiving either 100% (Option 3) or two-thirds (Option 4) for their lifetime. The selection is permanent once any benefit payment is cashed or deposited, or once DROP participation begins. If you are married and select Option 1 or 2, your spouse must acknowledge the selection on Form SA-1.

Related: Joint Annuitant, DROP, COLA

Joint Annuitant

A person eligible to receive a continuing monthly benefit after the member's death under benefit payment Option 3 or Option 4. For members retiring on or after January 1, 1996, a qualifying joint annuitant is a spouse; a biological, legally adopted, or step child under age 25; a disabled child of any age; a parent or grandparent; or a person for whom the member is the legal guardian. Options 1 and 2 use a designated beneficiary instead, who does not need to meet joint annuitant qualifications. A joint annuitant designation under Option 3 or 4 can be changed up to two times after retirement, and each change triggers a benefit recalculation.

Related: Benefit Payment Option

Vesting

The minimum years of service required to be entitled to a future pension benefit. Pre-2011 FRS enrollees vest at 6 years; post-2011 enrollees vest at 8 years. The same thresholds apply to both Special Risk and Regular Class members.

Enrollment Era

Whether you became an FRS member before July 1, 2011 ("pre-2011") or on or after that date ("post-2011"). The era determines your AFC period (5 vs 8 years) and vesting (6 vs 8 years). It does not determine the DROP interest rate — that is set by the date you begin DROP participation, not your enrollment date.

Normal Retirement

The point at which a member can begin receiving a full, unreduced pension. For Special Risk members: (1) age 55 with at least 6 years of service (pre-2011) or 8 years of service (post-2011), or (2) 25 years of Special Risk service regardless of age and enrollment era, or (3) age 52 with 25 years combining Special Risk service and up to 4 years of active-duty wartime military service. For Regular Class members: (1) age 62 with 6 years of service (pre-2011) or age 65 with 8 years of service (post-2011), or (2) 30 years of service (pre-2011) or 33 years of service (post-2011) regardless of age.

Early Retirement

A vested member who separates before reaching normal retirement and elects to begin receiving benefits immediately takes a permanent reduction of 5% for each year under normal retirement age at separation, prorated to 5/12 of 1% per month. The normal retirement age used for the reduction is age 55 for Special Risk members and age 62 (pre-2011) or 65 (post-2011) for Regular Class members. The reduction does not go away later — it applies for life. A non-vested member who separates has no pension rights and receives only a refund of their employee contributions.

Related: Normal Retirement, Vesting, Deferred Retirement

Deferred Retirement

A vested member who separates before reaching normal retirement can leave their pension in FRS and begin collecting at age 55 with no reduction. Average Final Compensation and years of service are frozen at the separation date, and no COLA accrues during the deferral period. The member receives no pension payments between separation and age 55 — income during those gap years must come from other sources (457(b), Roth IRA, spouse income).

Related: Normal Retirement, Early Retirement, Vesting

457(b) Plan

A tax-advantaged deferred compensation plan available to public-sector employees. Governmental 457(b) plans permit penalty-free withdrawals after separation from service at any age, and have a special "final three years" catch-up provision before normal retirement age. Distributions are subject to required minimum distributions (RMDs) beginning at age 73 (or 75 for those born in 1960 or later under SECURE 2.0).

Public Safety Officer Penalty Exemption

The Public Safety Officer (PSO) penalty exemption (IRC §72(t)(10)) allows firefighters, law enforcement officers, and other qualified public safety officers who separate from service at age 50 or older to take penalty-free distributions from qualified retirement plans such as 401(a), 403(b), or pension plan rollovers to a traditional IRA. This exemption does NOT apply to governmental 457(b) plans — those plans already permit penalty-free withdrawals after separation from service at any age under IRC §72(t)(9). The PSO exemption is most relevant when rolling a DROP lump sum into a traditional IRA, where it may allow penalty-free access starting at age 50 rather than the standard 59½.