The LAGERS law allows a member in service who has accrued at least five years of credited service and has reached early retirement age (age 55 for general; age 50 for fire and police employees) to draw a monthly retirement benefit. The benefit is calculated in the same manner as a benefit for a normal retirement except it is reduced by one-half of one percent per month for each month the employee's age at retirement is younger than the normal retirement age.

For example, assume a general employee retiring at age 58, $3,000 final average salary and 25 years of credited service under the L-7 program:

Reduction: 24 months early x 1/2 of 1% per month = 12% Employee Benefit: 88% of benefit at age 60

1.50% x $3,000 x 25 years = $1,125 x 88% = $990

The reduction is designed so that an employee that retires at the normal retirement age and another employee who chooses an early retirement, all other factors being equal, will withdraw from LAGERS approximately the same amount of money by the time payments are no longer payable from their accounts.