Minnesota’s 60-30 Rule: A Milestone for Educators 🎉
Background
On May 19, 2025, the Minnesota Legislature approved — and on May 23, Governor Tim Walz signed — pioneering pension reform for members of the Teachers Retirement Association (TRA) that lowers the enhanced early-retirement age from 62 to 60 years old, provided teachers have at least 30 years of service. The early-retirement penalty was also reduced from 6% to 5%, allowing qualifying educators to leave the classroom earlier with less financial sacrifice.
This isn’t just a tweak—it’s a transformational shift. For decades, educators hired pre-July 1, 1989, enjoyed a robust “Rule of 90” (age + years of service = 90) and could leave anytime after that threshold with full benefits. However, Tier 2 educators—hired on or after that date—faced stringent penalties, often needing to wait until age 65 to fully retire.
The enhanced 60-30 rule brings Tier 2 retirees closer to the old Rule of 90 at age 60, closing what’s been a longstanding gap in retirement fairness.
Legislative and Political Context
This was no partisan gambit—it passed with rare bipartisan support in both chambers. The House approved the omnibus pension bill 133–1, and the Senate 55–12. Sponsors on both sides recognized the urgency: Minnesota is in a teacher-shortage crisis—with nearly 90% of districts struggling to fully staff—and improved retirement options are key to both recruitment and retention.
State Senator Nick Frentz (DFL) underscored the shift toward supporting educators in a competitive labor environment, while Rep. Danny Nadeau (R-Rogers) emphasized how cutting early-retirement penalties “almost in half” gives teachers real flexibility.
Governor Walz affirmed the bipartisan partnership: “Minnesota is a state that values the hard work and contributions of public servants like our teachers … This bill fulfills our commitment to ensure those who have committed their life to public service can retire with economic security.”
Why the 60-30 Rule Is a Big Win for Educators
1. Earlier Retirement with Lower Penalties
- Two years earlier retirement: Tier 2 teachers who complete 30 years of service can retire at 60 instead of waiting until 62.
- Reduced penalty burden: The penalty dropped from 6% per year to 5% per year, cutting the reduction by approximately 1/3—making significant financial improvements, especially over multi-year retirements.
2. Retention and Recruitment Strategy
The teacher workforce crisis is stark—some years saw resignation rates up to 23% overall and up to 30% among rookie teachers (KAAL-TV).
By offering a more accessible path to retirement, older—and often more experienced—teachers aren’t compelled to stay longer than they want. This paves the way for newer teachers to enter the system earlier, helping balance pension costs and classroom vitality.
3. Fairness for Tier 2 Educators
It’s a long-overdue correction for Tier 2 educators, who historically faced harsher retirement penalties than their Tier 1 counterparts.
The 60-30 rule aligns Tier 2 benefits more closely with Rule of 90, especially at age 60 and beyond. For newly eligible retirees at age 61+, the enhanced rule offers higher monthly benefits—validating decades of service.
Still a Step Away: The Unreduced Career Rule of 60-30
The new law is a landmark—but it stops short of guaranteeing a fully unreduced career benefit at 60 with 30 years. Right now, educators who retire at 60 still face a 5% penalty per year until they reach normal retirement age.
Education Minnesota continues advocating for a full unreduced 60-30 career rule—which would restore full benefits at age 60+ with 30 years of service, no penalty attached (2025 Legislative Agenda).
Why an unreduced rule still matters:
- Aligns with Rule of 90
- Amplifies recruitment/retention
- Acknowledges decades of service
- Provides flexibility
Possible Next Steps & What’s Ahead
Building Momentum
A group of bills in the Legislature—including HF 1582/SF 2000—are pushing for unreduced 60/30 retirement, but funding remains the key hurdle.
Supporters argue that offering full retirement at 60 could save money in the long run—newer, lower-paid teachers replace high-salary veterans.
Union Engagement
Education Minnesota has engaged members extensively: thousands of letters, calls, rallies and lobbying efforts shaped this victory.
They’ve made it clear: the 60-30 enhanced rule is just a starting point, and educators will continue pushing for full unreduced career status.
Next Legislative Window
The next session begins in early 2026. Pending existing omnibus pension items are already reviewed and built into law via Senate File 2884.
On the table is a bill (SF 3467/HF 3269) that explicitly calls for an unreduced annuity at age 60/30 by modifying early retirement reduction factors—including removing penalties altogether.
Understanding the Numbers & Financial Impact
Cost to State Budgets
- Lowering the age from 62 to 60 and reducing penalties costs approximately $240 million/year if full unreduced retirement was included.
- Bipartisan lawmakers are still exploring fiscal models that would support unpenalized 60-30 retirement.
- Funding ideas include repurposing existing expenditures or adjusting contribution formulas. Some proposals—like increasing employer contribution rates—have already been implemented.
Where Things Stand & Why Educators Should Care
The 60-30 enhanced rule is historic, especially for Tier 2 educators. It marks the first time in many years that Minnesota has significantly elevated teacher pension benefits.
👉 But it’s not the finish line.
Tips for Educators Today
- Re-calculate your benefits under the new 60-30 rule—consult TRA to understand your pension change. TRA is hoping to have the calculator updated with the new rule sometime in July.
- Join the legislative push—whether locally or at statewide rallies, collective organizing works.
- Follow the budget cycle—next session begins January 2026; now is the time to communicate with your Legislators.
- Stay informed—Education Minnesota’s Agenda, weekly Capitol Connection, and TRA are excellent sources.
- Share your story—your lived experience as a teacher adds immense weight to advocacy efforts.
In Summary
- The new 60-30 rule lowers retirement age to 60 and reduces penalties—an enormously meaningful step forward.
- This revision increases fairness for Tier 2 educators and helps address teacher retention and recruitment challenges.
- But, the career-rule fight isn’t over: educators continue to strive for unreduced retirement at age 60 with 30 years of service.
- Success in 2025 proves organizing works. With continued unity, balanced messaging, and calculated policymaking, Minnesota can fully honor decades of classroom dedication.
Final Word
Minnesota’s enhanced 60-30 rule is a breakthrough moment—transforming retirement for thousands of educators and signaling public servants that their decades of labor are valued.
But the state still has an opportunity—and indeed an obligation—to close the equity gap entirely. The goal: unreduced career retirement at 60/30—no penalty, no caveats.
By maintaining momentum and preparing for the next legislative window, we can truly make retirement plans that reflect their contributions, not reduce them.
