Bottom line
CalSTRS 2% at 62 generally applies to members first hired for creditable service on or after January 1, 2013. It uses later age factors, a 36-month final-compensation period and a lower compensation cap.Key facts
- CalSTRS 2% at 62 generally covers members first hired for creditable activities on or after January 1, 2013
- The age factor is 2% at age 62 and reaches a maximum of 2.4% at age 65
- The 2% at 62 compensation cap is $191,866 for fiscal year 2026–27
Who falls under CalSTRS 2% at 62
California’s Public Employees’ Pension Reform Act of 2013 created the newer CalSTRS benefit structure for members first hired to perform CalSTRS creditable activities on or after January 1, 2013. CalSTRS calls this structure 2% at 62. The name refers to the age factor: at age 62, the standard factor is 2% of final compensation for each year of service credit. Membership history, not the member’s current age, determines which structure applies.
CalSTRS 2% at 62 has retirement eligibility beginning at age 55 with at least five years of service credit, subject to the system’s concurrent-retirement provisions in special cases. Retiring before 62 means a lower age factor. Waiting beyond 62 raises the factor until it reaches a maximum of 2.4% at age 65. Unlike the older 2% at 60 structure, 2% at 62 does not offer the career-factor enhancement.
How the age factor changes the retirement formula
The CalSTRS Defined Benefit formula combines service credit, an age factor and final compensation. For 2% at 62, the official age-factor table shows 1.16% at age 55, 2.00% at age 62 and 2.40% at age 65 and later. That makes retirement age an explicit multiplier, not merely an eligibility gate. A member who qualifies to retire at 55 can receive a benefit, but the factor is materially lower than it would be at the normal retirement age.
For an illustration, 25 years of service multiplied by a 2% age factor equals 50% of final compensation before considering other account-specific details. The same 25 years at a 1.16% age factor would produce 29% in the same simplified multiplication. Those percentages are examples of the formula mechanics, not individual benefit quotes; CalSTRS service records, final compensation and the effective retirement date control the actual result.
| Retirement age | Age factor | Meaning |
|---|---|---|
| 55 | 1.16% | Earliest standard eligibility age with 5 years |
| 62 | 2.00% | Normal 2% at 62 factor |
| 65+ | 2.40% | Maximum age factor |
How to verify your PEPRA-era record
Check myCalSTRS for your benefit structure, service-credit total and current compensation history. Do not infer 2% at 62 solely because you changed districts after 2013; the relevant question is when you first became eligible through CalSTRS creditable activity and how any prior California public retirement service affects your record. The benefit-structure label shown by CalSTRS is more reliable than reconstructing the history from current employment dates alone.
Then review the features that differ from 2% at 60: a 36-month final-compensation period, no career factor and a lower pensionable compensation cap. For fiscal year 2026–27, CalSTRS lists the 2% at 62 compensation cap at $191,866. The member contribution rate for 2% at 62 is 10.205% of creditable earnings for 2026–27. Recheck annual limits before using them in a future-year projection.
PEPRA changed more than the normal retirement age
The 2% at 62 label is easy to reduce to a two-year shift in normal retirement age, but CalSTRS lists several structural differences. Final compensation is based on 36 consecutive months regardless of service length, the benefit structure has a lower compensation cap and the older career-factor enhancement is unavailable. These differences can change the value of late-career salary growth and long service even when two educators have similar total years of service.
The compensation cap is especially relevant for higher-paid administrators and educators with substantial additional creditable compensation. CalSTRS lists a 2% at 62 cap of $191,866 for July 1, 2026 through June 30, 2027. The separate federal 401(a)(17) cap for affected members is $360,000 in the same fiscal year, but the lower 2% at 62 limit can constrain pensionable compensation well before that broader federal ceiling is reached.
| Feature | Current rule | Planning implication |
|---|---|---|
| Normal age factor | 2% at age 62 | Earlier retirement uses a lower factor |
| Maximum age factor | 2.4% at age 65+ | Waiting past 65 does not raise this factor further |
| Final compensation | 36 consecutive months | No one-year enhancement |
| 2% at 62 compensation cap | $191,866 | Recheck each July |
Contribution rates and compensation limits are different concepts
CalSTRS lists the 2026–27 member contribution rate at 10.205% of creditable earnings for 2% at 62 members. That rate tells you how much of creditable pay is contributed by the member under the current schedule. The compensation cap answers a different question: how much pay can be recognized for the pension program. Mixing the two can lead to a mistaken assumption that a contribution percentage applies without limit to every dollar of salary.
For payroll review, compare your pay statement with the annual CalSTRS contribution rate and the creditable compensation posted to your account. If compensation crosses the applicable cap, do not assume contributions and pension credit continue in the same way above that threshold. CalSTRS updates limits by fiscal year, so the 2026–27 figures should not be copied forward into later years without checking the new publication.
How age and salary interact in a retirement-date comparison
A retirement-date decision can change both the age factor and the 36-month salary window. Delaying retirement can raise the 2% at 62 age factor until age 65, while additional covered employment may also replace an older lower-compensation month inside final compensation. Those effects should be modeled separately so a member can see whether the projected increase comes from age, service, salary averaging or more than one factor at once.
Use the CalSTRS calculator or benefit estimate with several retirement dates, then confirm which final-compensation months and age factor the system used. A simplified spreadsheet can illustrate direction, but it can miss compensation limits or record-specific service. If a future retirement year is being compared, label current contribution rates and salary caps as assumptions and update them when CalSTRS publishes the new fiscal-year amounts.
Before you make a decision
- Confirm the benefit structure shown in myCalSTRS.
- Verify at least five years of service before using the standard age-55 eligibility rule.
- Compare age factors for the retirement dates you are considering.
- Use a 36-month final-compensation window in projections.
- Apply the current 2% at 62 compensation cap to pensionable-pay assumptions.
- Update contribution rates and limits when a new fiscal year begins.
Frequently asked questions
Who is in CalSTRS 2% at 62?
CalSTRS generally places members first hired to perform CalSTRS creditable activities on or after January 1, 2013 in the 2% at 62 benefit structure. A prior membership or concurrent-retirement history can affect how the record is classified, so confirm the benefit structure shown in myCalSTRS.
What is the earliest retirement age for CalSTRS 2% at 62?
The standard eligibility rule is age 55 with at least five years of service credit, subject to special concurrent-retirement circumstances. At age 55, the 2% at 62 age factor is 1.16%, which is lower than the 2% factor available at age 62.
What is the maximum age factor for CalSTRS 2% at 62?
The maximum age factor is 2.4%, reached at age 65. CalSTRS’s current table keeps the factor at 2.4% after that age. Service credit and final compensation still matter, so reaching the maximum age factor does not by itself determine the final pension amount.
What is the CalSTRS 2% at 62 compensation cap for 2026–27?
CalSTRS lists the fiscal-year 2026–27 compensation cap for 2% at 62 members at $191,866. The amount is adjusted over time, so use it for the current fiscal year and recheck the official limits page before projecting later-year pensionable compensation.
Can a CalSTRS 2% at 62 member use one-year final compensation?
No under the standard 2% at 62 structure. CalSTRS states that final compensation is based on the highest average annual compensation earnable during 36 consecutive months, and 2% at 62 members are not eligible for the 12-month final-compensation enhancement under current rules.
Official sources
Sources were reviewed on September 1, 2026. Rules and member records maintained by the retirement system control.
CalSTRS — Two Benefit StructuresOfficial source ↗CalSTRS — LimitsOfficial source ↗CalSTRS — ContributionsOfficial source ↗This article provides general educational information. It is not a benefit determination or financial, tax, or legal advice. Confirm account-specific information with the retirement system.