COLUMBUS, Ohio — The State Teachers Retirement System (STRS) of Ohio voted to implement a new benefits package for both current retirees and active members, aimed at enhancing retirement security while balancing long-term system sustainability.
In a close 6-4 vote, the STRS Board approved a $1.84 billion package that includes a cost-of-living adjustment (COLA) for eligible retirees starting in fiscal year 2026, as well as significant changes to service requirements for future retirement eligibility. Dissenting board members raised concerns about the financial impact of the move, citing ongoing stock market volatility.
Effective July 1, 2025, benefit recipients who began receiving their pensions on or before June 1, 2021, will receive a 1.5% COLA. This adjustment will be applied to their base benefit on the anniversary of their retirement date and added monthly thereafter.
This decision marks the return of automatic COLAs for a segment of STRS retirees following years of halted or modified cost-of-living increases as the system sought to shore up its finances.
Retirement Eligibility Eased for Limited Period
In a shift that could affect thousands of Ohio educators nearing retirement, STRS will temporarily reduce the number of years required to receive full or partial retirement benefits. These changes are scheduled as follows:
- June 1, 2025 – May 1, 2030:
- Full benefits available after 32 years of service (down from 33 years)
- Reduced benefits available after 27 years (down from 28 years)
- June 1, 2030 – May 1, 2032:
- Full benefits eligibility increases to 33 years of service
- Reduced benefits require 28 years
- Starting June 1, 2032:
- Full benefits return to a 34-year service minimum
- Reduced benefits require 29 years
Unreduced retirement benefits continue to be calculated at 2.2% of the member’s total service credit.
The benefit changes were reviewed and supported by STRS’s actuarial consultant, Cheiron, under the STRS Ohio Sustainable Benefit Plan (SBP). This framework helps guide the board in making benefit adjustments that do not compromise the financial health of the retirement system.
Part of the SBP budget has already been utilized this fiscal year, including a one-time supplemental benefit payment for retirees and the initial reduction to the service requirement for new retirees.
In a statement, the board emphasized its goal to “carefully balance long-term sustainability of the pension fund with meaningful benefit enhancements for members.”
The approved changes are expected to benefit over 500,000 active and retired educators across the state.
For more information about these changes, STRS members are encouraged to visit the STRS Ohio website or contact member services directly.
