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FERS Retirement Example

FERS Retirement Example

FERS Retirement: Example

  • Employee has 26 years 9 months of Civil Service Credit
    - 5 years of Military Service
    - High 3 income is $78,000
    - Retiring at age 60
  • Employee DID NOT buy back his military service prior to retirement- Monthly income is $1,738.75
  • Employee DOES buy back his military service prior to retirement- Monthly income is $2,063.75
  • Employee DOES NOT qualify for OPM bonus.

Sick Leave:

FERS employees are now able to apply their sick leave towards their retirement. Contact us for more details.

Social Security Supplement:- (provided by OPM)

One of your major components of your total retirment income is Social Security.  If you retire before the age of 62 and qualify for an immediate annuity pension without any penalty OPM recognizes the gap in your retirement income.  Thus OPM will provide you a supplement until you reach 62.  It is very important to remember that OPM does require you to follow the same earnings test which Social Security follows.  If you plan on working another job after retirment and earn more than allowed (14,160 for 2010) then you will be required to REPAY back any collected supplement at the end of the year. Remember, you must still apply for Social Security when you turn 62. 

Social Security:

Minimum age 62. Social Security income is subject to a reduction if your taxable income earnings are greater than $14,160 for 2010 (called an earning test). Contact us for more details on reduction.

Year of Birth Full Social Security Benefits
1937 or Earlier 65
1940 65 & 2 months
1945 66
1955 66 & 2 months
1960 & After 67

*Table indicates the age you are no longer subject to a reduction in Social Security Income

Thrift Savings Plan (TSP):

TSP offers employees a way to potentially increase their retirement income with tax deferred growth and the ability to reduce tax liability today.
Employees also have the ability to invest in 5 specific individual funds and a life cycle (auto pilot) called the L Cycle which is a combination of the 5 funds.

Survivor Pension:

Employees are required at retirement to either elect or reject a survivor pension if they are married. If the employee chooses NOT to provide the survivor pension then the spouse must sign off. Click here for more details.

Did you know? You may qualify for a Survivor Pension with benefits that can be transferred to your children or partially refunded back to the retired employee if your spouse predeceases you.