Borrowing from your Account

The Public School Employees’ Retirement Code (Act 96 of 1975) not only establishes the rules for PSERS to manage your retirement account, it protects your PSERS benefit, as well.  

Under the law, we cannot allow you to receive any contributions and interest from your account without terminating all Pennsylvania public school employment.  Therefore, PSERS may not provide you with a loan or allow you to borrow funds from your account.  Additionally, your funds in PSERS may not be attached, assigned, or used for collateral.   

Please note:  If your membership class is Class T-E or Class T-F, you may not withdraw any contributions or interest unless you terminate all Pennsylvania public school employment and elect to receive a refund.  If you qualify for and elect to receive a retirement benefit, you may not withdraw your contributions and interest.   

Protection from Bankruptcy

Your PSERS pension is excluded from the bankruptcy estate under section 541(c)(2) of the Bankruptcy Code.  The Bankruptcy Court for the Western District of Pennsylvania has also ruled that the PSERS’ pension fund is excluded from the bankruptcy estate under section 541(c)(2).  

After Retirement  

When you become a PSERS retiree, this same law prevents the liquidation of your monthly benefit in a lump-sum payment.  This guarantees that you will receive a monthly benefit payment for the rest of your life.  Once you retire, however, there are liens or levies that may be applied, such as payments directed within a Domestic Relations Order (DRO), court ordered child support, or Internal Revenue Service (IRS) tax liens.  

These provisions under the law help to ensure that your PSERS benefit is protected well into your future.