Contributions

The retirement system is funded by contributions of public school employers and employees, and by the investment earnings on these contributions. All contributions are a funding source for pensions and do not result in individual benefits in addition to the pension.

Employer contributions.

Each year an actuary determines how much the public schools need to contribute to fund their portion of member benefits. These contributions are not refundable to you or your employer.

Your contributions.

As a MIP participant, you also contribute a percentage of your salary to the pension reserve fund. Your contribution rate depends on when you first begin working for a Michigan public school reporting unit.

• If you elected the MIP before January 1, 1990, OR were a Basic Plan participant who enrolled in the MIP by January 1, 1993, you contribute 3.9 percent of your pretax salary.
• If you are a new member who began Michigan public school employment between January 1, 1990, and June 30, 2008, OR are a returning member who did not work between January 1, 1987, and December 31, 1989, you contribute pretax contributions based on the following chart:
   

  MEMBERSHIP ESTABLISHED BEFORE JULY 1, 2008
  COMPENSATION (school fiscal year earnings)	MIP CONTRIBUTIONS
  Up to $5,000	3% of compensation (up to $150 total)
  $5,000 to $15,000	$150, plus 3.6% of compensation between $5,000 and $15,000 (up to $510 total)
  Over $15,000	$510, plus 4.3% of compensation over $15,000

• If you first became a member of the system on or after July 1, 2008, you contribute pretax contributions based on the following chart:
   

  MEMBERSHIP ESTABLISHED ON OR AFTER JULY 1, 2008
  COMPENSATION (school fiscal year earnings)	MIP CONTRIBUTIONS
  Up to $5,000	3% of compensation (up to $150 total)
  $5,000 to $15,000	$150, plus 3.6% of compensation between $5,000 and $15,000 (up to $510 total)
  Over $15,000	$510, plus 6.4% of compensation over $15,000