Purchasing Service Credit 

Uses of Additional Service Credit 

This additional service credit may be used to:

• Reach eligibility for retirement sooner,

• Increase the final retirement benefit,

• Restore prior service credit from previous public employment, or

• Receive credit for certain types of eligible prior or intervening service.

Types of Eligible Service for Purchase

The following types of service may be eligible for purchase, subject to approval by the Division of Pensions and Benefits:

• Temporary or provisional public employment in New Jersey

• Prior employment with a different New Jersey public employer not credited at the time of enrollment

• Military service (pursuant to federal and state laws)

• Leaves of absence without pay, under qualifying circumstances

• Out-of-state public service (limited eligibility; certain restrictions apply)

• Former membership in a New Jersey state-administered retirement system where service was withdrawn

Application Process

• Employees must submit a Purchase Application through the Member Benefits Online System (MBOS), available on the New Jersey Division of Pensions and Benefits website.

• The application must specify the type and period of service for which credit is requested.

• Upon review, the Division will issue a Purchase Cost Quotation outlining the cost and available payment options.

Payment Options

Approved service credit purchases may be paid by:

• Lump-sum payment (full or partial)

• Payroll deductions over a specified term (interest-bearing)

• Direct rollover or trustee-to-trustee transfer from eligible retirement accounts (e.g., 403(b), 457(b), IRA)

Interest accrues on installment payments. All purchase balances must be satisfied prior to retirement in order for the additional credit to be applied to the final pension calculation.

Limitations and Important Considerations

• Service credit purchases are irrevocable and non-transferable once processed.

• The cost of purchasing service credit is determined by the Division of Pensions and Benefits based on actuarial formulas and the employee’s age, salary, and membership tier.

• Purchasing additional service does not guarantee early retirement eligibility unless the total years of service meet retirement plan requirements.

• Requests to purchase credit should be submitted well in advance of intended retirement to ensure processing time and full payment before the retirement date.

Employee Responsibility

It is the responsibility of the employee to initiate a purchase request, follow up with the Division of Pensions and Benefits, and complete all payments necessary to finalize the credit. The Human Resources Department can provide general assistance but cannot authorize or influence the approval process.