The account will earn interest at the rate of five percent per annum through final distribution. Upon retirement, the balance of the DROP account is disbursed either in a lump sum or in installments. DROP participants will continue to make monthly contributions required by law to the TRS retirement fund and for TRS-Care, the retiree health program. Currently, the employee contribution is 6.4 percent of pay and the state contributes six percent to the retirement fund. Public school employees also contribute .25 percent of their pay to the retiree health program, and the state doubles this at .50 percent.
Nothing is forfeited.
The DROP account along with accumulated interest will be distributed to the member upon retirement. The amount of the annuity is established and frozen when DROP is elected. This means that participating members will not accumulate any further retirement benefits towards their annuity, e.g., no further years of service or compensation improvements. Interest is accumulated at the rate of five percent per annum during participation and until all DROP balances have been distributed. If a member continues to work after completing DROP participation, credit is earned toward a second, separate annuity.