New Mexico established a retirement system for its public employees in 1947. Today, PERA manages 31 retirement plans and two benefit tiers for state, municipal and county employees. This includes police, firefighters, judges, magistrates, legislators and volunteer firefighters. The association also manages retirement plans for other political subdivisions, such as special districts and housing authorities. In 2014, the average annual pension was $29,937.

Defined Benefit Plan

One of the most important benefits you receive as a public employee is membership in the Public Employees Retirement Association of New Mexico. PERA provides a lifetime pension when you retire and a lifetime pension for your beneficiary as well, if one is chosen.

PERA is a 401(a) qualified government plan governed by the New Mexico Public Employees Retirement Act. A public employer affiliated with PERA must deduct employee contributions each pay period from the employee's wages. These contributions are paid into the PERA member contribution fund. The employer also must pay employer contributions into the PERA employers accumulation fund each pay period.

Member contributions to PERA are generally not taxed while you are making contributions. Benefits and contributions are taxed when you receive the money either as a monthly pension or through a refund.

Because PERA is a defined benefit plan, you are guaranteed life-long monthly benefits after retirement. Benefits are paid when certain age and service credit eligibility requirements are met, regardless of the amount of member contributions paid into the plan. You benefit will also increase if you are eligible for a Cost-of-Living Adjustment (COLA).

The contributions you make over your career are paid out in pension benefits in the first 3 - 4 years of retirement. Pension payments for the rest of your lifetime are funded by contributions and earnings on PERA investments. PERA also provide disability retirement, a benefit rarely offered in the private sector.