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At its September meeting, the Board unanimously voted to approve a 2.5% cost-of-living adjustment (COLA) increase for eligible retirees and beneficiaries in 2023.
The SDRS Special Pay Plan (SDRS-SPP) is an additional retirement plan funded by an eligible employees special pay (termination pay) which is compensation other than regular salary or wages accumulated by an employee and converted to a lump-sum amount at termination of employment.
Normal retirement age is 65 with three years of service. Early retirement age is 55 with three years of service with unreduced benefits upon attaining Rule of 85 (age plus service equals or exceeds 85). Early retirement reduction with less than 20 years of service is 3% per year.
Normal retirement age is 65 with three years of service. Early retirement age is 55 with three years of service with unreduced benefits upon attaining Rule of 85 (age plus service equals or exceeds 85). Early retirement reduction with less than 20 years of service is 3% per year.
If you are receiving SDRS retirement benefits and die, your eligible surviving spouse will receive a surviving spouse benefit. This benefit is equal to 60 percent of the benefit you were receiving at the time of your death and is payable for your spouses lifetime with cost-of-living adjustments.
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Throughout the state, retirees enjoy a lower cost of living compared to the national average, so youll get the joy of seeing your hard-earned retirement savings stretch further in South Dakota.
Cost-of-living adjustment (COLA) for 2023 Under the TVARS Rules, the COLA is calculated as the percentage change in the average CPI-U for the period of November 2020 October 2021 to the period November 2021 October 2022 (8.04%) minus 0.25%, with a cap of 6%.
South Dakota Retirement Taxes It has no income tax, relatively low sales taxes, high property taxes and no estate or inheritance taxes. Living costs in South Dakota are average. In fact, in many parts of the state, retirees can afford the basic cost of living with the average Social Security income alone.

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