Glossary
CalPERS
CalPERS (the California Public Employees' Retirement System) is the pension system covering most California state employees and many city, county, and agency workers, paying a lifetime benefit based on salary, years of service, and a benefit formula.
It is the largest public pension fund in the United States. A member's benefit depends on their formula (such as 2% at 62 for most post-2013 hires under PEPRA), final compensation, and service credit — not on investment performance, which is the employer's and system's concern in a defined benefit plan.
Why it matters in practice
CalPERS members face one-time, largely irreversible elections: retirement date, survivor continuance options, and service credit decisions. Because the pension is a fixed formula, the planning questions usually sit around it — how the benefit coordinates with Social Security, supplemental savings such as a 457(b), and what a chosen survivor option costs in monthly income.
Related terms: CalSTRS · Pension · Defined Benefit Plan · 457(b) · Longevity Risk