Ask The Experts: Retirement

By Reg Jones

Deferred annuity

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Q. I reach my minimum retirement age on Jan. 3, but I will only have credit for 29 years, which would give me a 25 percent reduction by taking retirement at this time. If I do a deferred retirement and retire at age 60, will that eliminate the penalty and allow me to collect the special retirement supplement at 60 also? Can I buy health insurance between 56 and 60 by taking a deferred annuity at 60? I have enough in the Thrift Savings Plan to collect about $36,000 a year for four years and still have well over $200,000 at 60. Is this a good plan or not?

A. If you leave government before being eligible to retire, you could apply for a deferred annuity at age 60. However, you wouldn’t be eligible for the special retirement supplement. No one who applies for a deferred annuity is.

When you resign, you’d receive 31 days of health benefits coverage at no cost to you. You’d also be able to continue that coverage for up to 18 months under the Temporary Continuation of Coverage provision, for which you’d have to pay the entire premium plus 2 percent. When you finally retired, you wouldn’t be able to re-enroll in the Federal Employees Health Benefits program.

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