SuperCalc

Calculate pension benefit estimates with years of service, final average salary, multiplier percentages, and COLA adjustments. Estimate monthly pension payments, annual income, replacement ratio, and total lifetime benefits for defined benefit plans including government, corporate, and union pensions in 2025.

Frequently Asked Questions

How do I calculate my pension benefit in 2025?

Pension benefit calculation (2025 standard formula): **Monthly Pension = Years of Service × Benefit Multiplier × Final Average Salary (FAS)**.

Example: 30 years service, 2% multiplier, $80,000 FAS → 30 × 0.02 × $80,000 = **$48,000/year** ($4,000/month) = 60% income replacement.

**Final Average Salary (FAS)**: Usually highest 3-5 consecutive years.

Example: Last 3 years earned $75k, $78k, $82k → FAS = ($75k + $78k + $82k) / 3 = **$78,333**.

Some plans use highest 5 years (not necessarily consecutive) → cherry-pick best 5: $78k, $82k, $85k, $80k, $81k → FAS = $81,200 (3.7% higher).

**Benefit Multiplier**: Varies by plan type.

Government pensions (FERS): 1-1.1% for most, 1.1% if retire at 62+ with 20+ years.

State/local: 1.5-2.5% typical.

Corporate: 1-2%.

Union: 2-3%.

Example comparison at 30 years service, $80k FAS: 1% multiplier = $24k/year (30% replacement), 2% = $48k/year (60%), 2.5% = $60k/year (75%). **Higher multiplier = bigger pension**.

**Early Retirement Reduction**: Retire before full retirement age → penalty.

Example: Full retirement age 62, retire at 57 (5 years early) → Reduction 5-7% per year = 25-35% total cut. $48k/year pension → $31,200-$36,000 after early retirement penalty. **Cost**: $12k-$17k/year × 25 years = $300k-$425k lifetime loss.

BUT gain 5 extra years of payments = 5 × $32k = $160k → Net loss still $140k-$265k.

**COLA (Cost of Living Adjustment)**: Federal FERS = full CPI (3.2% in 2024).

State/local = varies (0% to full CPI).

Example: $48k/year pension with 2.5% COLA → Year 10 = $61,440 (28% increase), Year 20 = $78,566 (64% increase), Year 30 = $100,514 (109% increase). **Without COLA**: purchasing power erodes 50% over 25 years at 3% inflation. $48k in 2025 = equivalent $22,974 in 2050.

**Survivor Benefits**: Most plans offer 50-100% continuation to spouse.

Example: 100% survivor = reduce your pension 10-15%. $48k/year → $40,800-$43,200 with full survivor benefit. 50% survivor = reduce 5-7% → $44,640-$45,600. **Breakeven**: If spouse lives 10+ years after you die, survivor benefit pays off.

Single or spouse has own pension → skip survivor benefit, keep full amount.

About This Page

Editorial & Updates

  • Author: SuperCalc Editorial Team
  • Reviewed: SuperCalc Editors (clarity & accuracy)
  • Last updated: 2026-01-13

We maintain this page to improve clarity, accuracy, and usability. If you see an issue, please contact hello@supercalc.dev.

Financial/Tax Disclaimer

This tool does not provide financial, investment, or tax advice. Calculations are estimates and may not reflect your specific situation. Consider consulting a licensed professional before making decisions.