State Teacher Plans for Texas

Many teachers do not have access to low-cost choices in their 403(b) plans. Of the 134 district 403(b) plans that we have graded so far in Texas, 0 districts have an A rating, 0 districts have a B rating, 97 districts have a C rating, 23 districts have a D rating, and 14 districts have an F rating.

If you are a teacher in Texas, here are the state teacher plan options that are available to you.

Texas TRS

Most states still offer a traditional formula-based pension. Under this type of arrangement an educator would receive a percentage of their final year's salary until death that is based on some combination of years worked, age, and salary. Some states have made pension plans less generous to new hires, and some states have replaced traditional pensions with 401(k)-type plans.

More information about the Texas TRS plan is available directly from the pension website, and Karl Fisch's book on the Texas pension is available here. Pension plan information for other states is also available for reference through this state pension search tool. This data is shared with us by Karl Fisch, and it is current as of January 1, 2025.

Applicable to All Teachers

Social Security

Texas teachers do not pay into Social Security

Administrative Fee for Supplemental Plans

None

New Teachers Hired On or After 1/1/2024

Defined Benefit

Employee: 8.25%; Employer: 2%; State: 8.25%

Multiplier

2.3%

Average Salary

Highest 5 years

Normal Retirement

Rule of 80 (age plus years of service is greater than or equal to 80)
Age 62 with 5 years of service
Age 65 with 5 years of service

Cost-of-Living Adjustment (COLA)

None

Veteran Teachers Hired Prior to 1/1/2001

There are 2 additional benefit tiers between the new teacher and veteran teacher tiers compared here. The exact transition dates between these tiers are not relevant to this comparison.

Defined Benefit

Employee: 8.25%; Employer: 2%; State: 8.25%

Multiplier

2.3%

Average Salary

Highest 5 years

Normal Retirement

Rule of 80 with 5 years of service (age plus years of service is greater than or equal to 80)
Age 65 with 5 years of service

Cost-of-Living Adjustment (COLA)

None

Texas 457(b)

Every state operates a 457(b) plan that serves governmental workers like police, fire, and state government officials. These plans are generally excellent, and in many cases they are superior to the 403(b) offerings available in school district plans. Most states allow educators to participate in these plans; unfortunately, about a dozen do not.

Find out more about how we rate state 457(b) plans and view plans in other states.

Green Texas$aver 401(k) and 457(b)

Texas teachers are not eligible to contribute to this plan.

Fees

0.00% admin fee, $18 account fee, and a low index fee

Record Keeper

Empower

Target Date Fund

Blackrock

Back to search