Every Florida Retirement System member gets a choice between two very different retirement plans. Some people chose years ago and never looked again. Others are new hires facing a deadline. Either way, it helps to understand how the two plans work before you count on one of them or think about switching.
The short version
- The FRS Pension Plan is a defined benefit plan. Your benefit is a lifetime monthly payment based on a formula: your years of service, your membership class, and your average final compensation.
- The FRS Investment Plan is a defined contribution plan, similar to a 401(k). Contributions go into an account in your name, you pick the investments, and your account value depends on contributions and investment performance.
Both plans receive employer contributions, and in both, most members contribute 3% of salary.
How the Pension Plan works
In the Pension Plan, the benefit is calculated, not invested by you. In simple terms, the formula multiplies your years of service by a percentage value for your membership class and your average final compensation (an average of your highest-paid years). The State Board of Administration manages the investments, and the plan, not you, carries the investment risk.
Key features:
- Vesting. If you were first enrolled on or after July 1, 2011, you generally vest after 8 years of service. Members enrolled earlier vested after 6 years.
- Normal retirement. For Regular Class members enrolled on or after July 1, 2011, normal retirement is generally age 65 with 8 years of service, or 33 years of service at any age. Earlier members and Special Risk members have different rules.
- DROP. Only Pension Plan members can participate in the Deferred Retirement Option Program. See our guide, What Is DROP?.
- Survivor options. At retirement you pick a payment option that decides whether a beneficiary keeps receiving a benefit after your death.
How the Investment Plan works
In the Investment Plan, contributions go into your own account and you choose from a menu of investment funds. Your balance can go up or down with the markets.
Key features:
- Vesting. You generally vest in employer contributions after 1 year of service. Your own contributions are always yours.
- Portability. If you leave FRS employment, your vested balance can generally go with you, which matters for people who may not stay long enough to vest in the Pension Plan.
- You carry the risk. Your income in retirement depends on how much is contributed, how it is invested, the fees, and how you withdraw it. No lifetime monthly benefit is promised unless you buy one.
- No DROP. Investment Plan members are not eligible for DROP.
Your first choice and your second election
New employees have a limited window to choose a plan after they are hired. For most new hires since 2018 who are not in the Special Risk Class, if no choice is made the default is the Investment Plan. Check your own deadline with MyFRS as soon as you are hired.
After your initial choice, you get one second election during your active FRS career to switch plans. Switching has real costs and rules. Moving from the Investment Plan to the Pension Plan may require you to “buy in” using your account balance and possibly personal funds. Moving from the Pension Plan to the Investment Plan transfers the present value of your benefit, not your years of future service. Because you only get one, a second election is a decision to make slowly.
Side-by-side comparison
| Pension Plan | Investment Plan | |
|---|---|---|
| Type | Defined benefit (formula) | Defined contribution (account) |
| Who carries investment risk | The plan | You |
| Vesting (most members) | 8 years (enrolled on/after 7/1/2011) | 1 year |
| DROP available | Yes | No |
| Benefit form | Lifetime monthly payment | Account balance |
| Portability if you leave early | Limited | Vested balance goes with you |
Questions to ask about your situation
- How long do I expect to work for an FRS employer?
- How comfortable am I with market ups and downs?
- Would I rather have a predictable monthly income, or control over an account?
- Do I want the option of DROP later?
- Have I already used my second election?
The FRS also offers free, unbiased guidance through MyFRS Financial Guidance Line (1-866-446-9377). Using it alongside a personal review is a good idea.
Book your free review
With FRS, timing is everything. One wrong form, or the right form filed at the wrong time, can lock in a result that can’t be reversed. Book a free, one-on-one review and we’ll go through your dates, your forms, and your deadlines with you, so you know exactly what to file and when. It usually takes about 30 minutes, and there is no pressure. If you need help beyond the FRS process, such as investment or tax decisions, we can connect you with a licensed professional.
Book your free review · Call (850) 296-8828 · Email frshelp@floridapensionplanners.com
Disclaimer: Florida Pension Planners is an independent educational service and is not affiliated with, endorsed by, or acting on behalf of the Florida Retirement System, the State Board of Administration, the Division of Retirement, or any school district. This page is general education, not individual tax, legal, or investment advice. FRS rules change; confirm your own benefits and deadlines with the FRS Division of Retirement (frs.fl.gov) or MyFRS (myfrs.com) before making decisions. Rollover and investment choices carry risk, and no outcome or return is promised. Florida Pension Planners provides educational guidance and referrals. We do not provide investment, tax, or legal advice. Any financial advisor or other professional we connect you with is independent and is solely responsible for their own advice and services.
Sources (to verify on the live pages before publishing; myfrs.com blocked automated fetches on Oct 12, 2026) – MyFRS, Compare the plans: https://www.myfrs.com/ (plan types, 3% employee contribution, vesting 8 years vs. 1 year, second election, default plan for new hires) – FRS Division of Retirement: https://frs.fl.gov/ (Pension Plan benefit formula, normal retirement) – FRS DROP Guide: https://frs.fl.gov/forms/drop_guide.pdf (DROP only for Pension Plan members) – MyFRS Financial Guidance Line number: confirm at https://www.myfrs.com/
