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Purchase Service Credit

If you experience an interruption of covered employment due to military activation, the Uniformed Services Employment and Reemployment Rights Act (USERRA) may apply. Otherwise, Defined Contribution members are not eligible to purchase service credit.

Service credit is one of the factors used to calculate your retirement benefits.  NDPERS offers a variety of service credit purchase options. However, there are eligibility limitations.

If you have previous permanent public service, you may purchase this service credit at any time while actively contributing to NDPERS. 

Types of Eligible Previous Public Service

  • Service Credit in NDPERS defined benefit system that was forfeited by taking refund/rollover,
  • Employment by political subdivision participating in NDPERS which your employer did not purchase upon joining NDPERS,
  • Employment with a public employer either within or outside the state of North Dakota, or
  • Employment with the Federal government.

If you are an active employee of a participating employer and served time in the military, you may be eligible to purchase up to 48 months of active duty service credit for retirement purposes. If you experience an interruption of covered employment, the provisions of the Uniformed Services Employment and Reemployment Rights Act (USERRA) may apply.

If you are an active employee of a participating employer and are granted an employer approved leave of absence from your position, you will remain a member of NDPERS on inactive status. You will not receive service credit for any unpaid leave of absence because no contributions will be made during that time. However, you may purchase service credit for a leave of absence upon returning to work.

Seasonal employees who work less than 12 months each year may purchase their time away upon returning to work.

If you are an active employee of a participating employer and you served as a member of the Legislative Assembly while a member of NDPERS, you may be eligible to purchase legislative service credit. Service credit must be purchased within one year after the adjournment of the legislative session.

The easiest way to get your own service purchase estimate is online. Login to your PERSLink Member Self Service (MSS) account and click “Service Purchase” for a personal cost estimate.

In order to buy up to five additional years (60 months) generic service credit, you must be vested. Vested means you already have 3 years (36 months) of service credit or more with NDPERS.

If you choose to purchase generic service, this can be based upon a designated amount of funds or a designated number of months. You can submit more than one request for a generic service purchase. However, the total number of months purchased throughout your NDPERS career cannot exceed 60 months.

As your years of service, age and salary increases, this affects the purchasing factors, which also increases the cost of your service purchase.

The easiest way to get your own service purchase estimate is online. Login to your PERSLink Member Self Service (MSS) account and click “Service Purchase” for a personal cost estimate.

At termination of eligible employment, you may convert all or part of your unused sick leave (as certified by your employer) into service credit. One month of service credit will be awarded for every 173.3 hours of unused accumulated sick leave. Hours of sick leave equal to a fraction of a month are deemed to be a full month.

If you are transferring from one participating employer to another without terminating eligible employment, special provisions apply. See the “Notice of Transfer Kit”. NDPERS will record your unused sick leave if your new employer certifies it will not transfer your unused sick leave. You may purchase your unused sick leave at a later date, upon termination of eligible employment.

If you are retiring, conversion of sick leave is optional and does not affect any employer lump sum sick leave payment policies. To elect to convert your sick leave, the “Conversion of Unused Sick Leave Application – Defined Benefit SFN 58358” must be completed. Your sick leave payment must also be paid by the 15th of the month following the month of separation from employment.

The easiest way to get your own service purchase estimate is online. Login to your PERSLink Member Self Service (MSS) account and click “Service Purchase” for a personal cost estimate.

When you purchase service, you are “self-funding” your retirement for the number of months you buy. The majority of the purchase amount is deposited into your retirement account and earns interest monthly. A smaller portion is deposited into the Retiree Health Insurance Credit (RHIC) account. The RHIC must always be paid with after-tax dollars. The retirement portion of the service may be purchased with:

  1. Rollover from an eligible, pre-tax, qualified fund(s)
  2. One–time payment of after-tax dollars
  3. Monthly payments (finance charges apply)
    1. After–tax payments by personal check
    2. Payroll deduction
      1. After-tax
      2. Pre-tax (if this option is elected, the purchase can only be paid in full early if you are leaving service).
  4. A combination of any of the above (rollovers may only occur at the initial purchase stage).

The appropriate forms are mailed with the service purchase.

Benefit estimates revealing your monthly payment with and without the purchase are mailed so you can compare the benefit amounts and determine if a purchase adds value to your retirement.

Additional Information