This will be a little complicated, since your estimated pension earned to date will change each year.

Once you’re eligible, you can calculate the annual pension amount that you’ll get at full retirement age. Take that annual amount and calculate the

present value of those dollars. For the discount rate on the present value calculation, I use 7% since I would be investing any extra money that I had now. If you would instead be spending extra money you had now, then you’d instead use just a 2% inflation rate.

Then calculate the annual pension amount at full retirement with one additional year of service than you’ve earned to date. You could get fancy and drop off the lowest year’s pay and average in one more year of your current rate. Then take that annual amount and calculate the present value of that amount.

Now subtract the first calculation from the second and that tells you how much extra salary you can estimate is the annual value you get from that pension component.

For example: let’s say you’ve worked there for 5 years and so are vested. Let’s say you made $30k, 35k, 40k, 45k, and now $50k. The average of those values is $40k. So your benefit earned to date is 5*40000*.015 = 3000. Let’s say you’re currently 30 years old, so that’s 37 years in the future when you’d get this pension. And let’s say you would invest any extra money you had, so we will use a discount rate of 7%. So plugging that into the present value calculator says that pension is currently worth $245.43. And now to calculate one more year, 6*44000*.015 = 3960, which has a present value of $323.96. So staying and working an extra year is like getting paid an extra $78.53 that year.

Basically, at the beginning of your career, it’s worth a pretty small amount, because you’re not making much and because you have lots of years of compounding that weigh against it in the present value calculation. But as you get raises and get closer to the full retirement age, it’s worth a lot more. So if you get a job offer for a decent salary bump today, you should take it, but if you’ve been there 25 years then the salary bump would need to be a lot bigger to make leaving worth it.