Ask The Experts: Retirement

By Reg Jones

FERS law enforcement job and military buyback

Bookmark and Share

Q. I have been a FERS 6c employee for eight years. I have 12 years of active-duty military service. I have already put in two weeks’ notice to leave my 6c job but would like to buy back my military time to increase my deferred annuity. Do I have to buy back the military time before my employment terminates?

A. Yes.

Tags: , , , , ,

FERS payback and pension

Bookmark and Share

Q. I was checking for a friend who quit about four years ago. He took out his FERS and Thrift Savings Plan money. Can he pay back his FERS so he can receive a pension? He had about 14 to 15 years in.

A. He can only redeposit the refund of his FERS contributions if he returns to work in a position that confers FERS coverage.

Tags: , ,

Active-duty time and retirement

Bookmark and Share

Q. Hello, I’m a civil servant with a retirement service computation date of Aug. 28, 1986. This includes approximately 15 years of civil service time under FERS and two active-duty stints for the remainder. I have two DD-214s to account for the military time. My question concerns the noninclusion of other active-duty time I completed while a reservist. I completed approximately four more years of active duty between 1989 and 1997 that was not documented via a DD-214 — active duty for training, for example.

I understand that inactive training periods don’t count toward the computation, but does the ADT time count? Can I purchase this time back as well?

A. You’ll have to ask your agency personnel office to get verification from your branch of service for any periods of active-duty service you performed as a reservist. Note: To get retirement credit for any active duty service, you’ll need to make a deposit to the retirement fund.

Tags: , , ,

Early retirement

Bookmark and Share

Q. I am older than age 50 with 20 years of federal service. I fall under FERS. If I’m offered an early-out and I accept and then turn around and take another federal position, what are the ramifications? If I’m given a Voluntary Separation Incentive Pay for leaving, I realize that I will have to pay that back before starting my job. Will I be able to collect that if I hold another federal job, or does that discontinue once I start the federal job?

A. Your annuity would stop and you’d just be a regular employee. You wouldn’t be able to retire again until you either met the standard age and service requirements to do so or were offered another Voluntary Early Retirement Authority.

Tags: , , , , ,

Annuity computation

Bookmark and Share

Q. I am a 57-year-old FERS employee with 29 years and 11 months of civilian federal service, five years of active-duty military service and 31 years of military reserve service (I plan to retire from reserve duty at 60).  I want to know how my retirement from civilian federal service will be computed. I bought back the active-duty military service.

A. Your FERS annuity will be computed using the standard formula: .01 x your high-3 x your years and full months of service (including actual service and active duty service for which you’ve made a deposit).

Tags: , , , ,

Submitting retirement packet early

Bookmark and Share

Q. I have 33 years of service under FERS at age 55. I will not reach minimum retirement age until December. I would like to submit my retirement packet now. Is there a waiver I would qualify for to avoid the 5 percent-per-year penalty or that would waive the next 11 months to MRA?

A. Since you’d be retiring under the MRA+10 provision, there is no provision in law or regulation that would allow for a waiver of the 5 percent-per-year penalty. Because you have at least 20 years of service, the penalty would apply to age 60.

Tags: , , ,

Unused sick leave

Bookmark and Share

Q. I am retired military with 27 years in. Since that time, I have been a civil servant and am coming up on my 10-year anniversary under FERS. My service computation date is Aug. 10, 2003. I am planning to resign from my civil position Dec. 31, prior to my 62nd birthday. (I was born Dec. 11, 1952.) I plan to ask for a lump-sum check for my unused accrued leave. But it looks like I will not gain anything for having been such a healthy individual and that my many days of sick leave will simply go wasted. Is my sick leave balance used in any form to accrue additional deferred benefits or can I get paid for my unused balance?

A. If you leave your retirement contributions in the fund when you leave, you’ll be eligible for a deferred annuity. However, deferred annuitants receive no credit for their unused sick leave. FYI: If you stayed on until your 62nd birthday, you’d receive full credit for that unused sick leave in the computation of your annuity.

Tags: , , , , , , , , ,

Severance pay and deferred annuity

Bookmark and Share

Q. If a FERS employee is eligible for a deferred retirement (30 years qualifying service but not yet at minimum retirement age) but is involuntarily separated (instead of resigning) and receives severance pay upon separation, can he still file for and receive a deferred retirement later upon attaining his MRA?

Also, is it true that a deferred annuity is not subject to reduction if applied for at MRA when the employee had at least 30 years of service?

A. Yes and yes.

Tags: , , , ,

FERS or FERS-RAE?

Bookmark and Share

Q. I received a conditional offer of employment in the fall. Processing has been continuous. My actual start date will be this year. Will I fall under FERS, based on the offer date, or FERS-RAE, based on the start date?

A. To the best of my knowledge, your retirement contribution rate will be based on the day you are employed, not the date on which the offer was made.

Tags: , ,

Buyback

Bookmark and Share

Q. I am 54 years old and was employed with a federal agency for 17 years from 1979 to 1996. Upon resignation to enter the private sector, I withdrew 100 percent of my CSRS contributions. If I return to full-time federal employment this year, do I have the option of buying back the creditable service of 17 years for the same amount that I withdrew in 1996? Secondly, would I be able to continue with CSRS rather than FERS upon re-employment? Would I be eligible to retire after eight more years of federal employment service?

A. If you returned to work for the federal government, you’d be placed in CSRS Offset (CSRS and Social Security) with the option of transferring to FERS. On your return, you would be able to redeposit the money you took out and get credit for your prior service. However, it wouldn’t be the amount that was refunded to you; it would be that amount plus accrued interest. If you made the redeposit, you’d get credit for your prior service in determining your total service and in your annuity computation; if you didn’t, you’d only get credit for it in determining your length of service. Either way, you’d be able to retire at age 62.

Tags: , , , , , , , , , , , , ,

Survivor annuity

Bookmark and Share

Q. I am my sister’s only surviving relative. I have filled out and submitted the required paperwork to FERS. How long will it be before I receive payment from FERS? I have received payment from the Thrift Savings Plan.

A. Only the Office of Personnel Management can answer your question. Call them at 888-767-6738 or 724-794-2005.

Tags: , , ,

Special retirement supplement

Bookmark and Share

Q. On Sept. 2, I will be eligible to retire (age 56 with 30 years of service) under FERS. I plan to retire in September 2014 and would like to know if I will receive/be eligible for the special retirement supplement.  When using the Employee Benefit Information System to calculate my benefits and after annotating my salary history, I am not provided an estimate on the special retirement supplement.

A. Yes, you would be eligible for the special retirement supplement. To estimate what that would be, use the following formula: Multiply your estimated Social Security benefit by your total years of FERS service, rounded up to the next higher year and divide the product by 40.

Note: Only actual years of FERS service are used. Not included are any years of civilian or military service for which you’ve made a deposit.

Tags: , ,

FERS annuity

Bookmark and Share

Q. I have questions on calculating the FERS annuity.

Assume for simplicity’s sake that my high-3 is $50,000.

When you say years and months, is that decimal — i.e., 20 years and six months would be 20.5? If so, 20 years at age 60 (multiplier of .01) is $10,250 and if 62 (multiplier of .011), $11,275? Second, this is the annual annuity, so the monthly check is that amount divided by 12 or $854.16/ $939.58 per month and then taxes, etc., are deducted? Am I missing anything here?

A. Well done. You are right on all counts.

Tags: , ,

Active-duty military service and FERS vesting

Bookmark and Share

Q. I am a federal employee who worked for the Navy from 2002 to 2006, then had a break in service, and have been back working as a GS employee for the Navy since June 2009.

From 2004 to 2006 and June 2010 to February 2011, I was involuntarily mobilized and returned to active duty with my Marine Corps Reserve unit. Am I able to count this time toward the five-year vesting requirement for FERS?

A. No, not even if you make a deposit to get credit for that time.

Tags: , , ,

Applying for internal FERS position after three years out

Bookmark and Share

Q. I retired from the VA hospital three years ago with 25 years in FERS. Can I apply for a position advertised as open to internal employees only?

A. I doubt it because you aren’t a current employee. However, you’ll have check with your agency to see what it has to say.

Tags: ,

Leave without pay and benefits

Bookmark and Share

Q. I’m a dual-status federal tech. I am 47 and have 16 years under FERS counting 10 years of military service I bought back. I was injured during military duties that will make me unfit for my position in the Air National Guard. Will I be eligible for the 60/40 annuity when the ANG finds me unfit? If I receive disability payments from the Veterans Affairs Department, how will they affect my FERS disability annuity? I am out of sick and annual leave and have been told from the beginning there is no limited or light duty — if I can’t do all of my job, I can’t do any of it.

Will there be negative issues that crop up from being on extended leave without pay until my medical issues have resolved?

A. You would be able to receive both benefits with no reduction in either of them. Being on LWOP would have no effect unless you exceed six months in a calendar year.

Tags: , , , ,

Interrupted government service and pension

Bookmark and Share

Q. I am 54, with five years under FERS. I am taking a job in the private sector but would like to return to federal employment for three to five years. If I do nothing, can I apply for a deferred pension at age 62? If I do return to government service, do the total number of years accumulate? So, for example, if I return and work another five years, is my pension based on 10 years, even though they were interrupted?

A. As long as you don’t take a refund of your retirement contributions when you leave, you could apply for a deferred annuity at age 62. Also, if you left that money in the fund and returned to government employment, you’d be able to pick up where you left off, and all that time would count for determining your length of service and your annuity computation. If you did take a refund and returned to government service, you’d have to repay that amount plus accrued interest to get credit for that time.

Tags: , , ,

USPS early retirement and special retirement supplement

Bookmark and Share

Q. I have 30-plus years total; 11 years and nine months of that is military time I bought back. The rest of it is in the USPS. I will be 52 and am being offered early retirement. When I reach my MRA, will I be eligible for the special retirement supplement?

A. While you’ll be eligible for the special retirement supplement when you reach your MRA, it will be based solely on your years of actual FERS employment. Active-duty service for which you’ve made a deposit will not be included in that computation.

Tags: , , , , ,

FERS FROZEN and MRA+10

Bookmark and Share

Q. The minimum retirement age under FERS is 56 in my case (date of birth May 15, 1956). My PS Form 50 states my retirement plan as A – FERS FROZEN. Do I still qualify for the MRA+ 10?

A. According to the Office of Personnel Management, “When a CSRS employee elects to become covered by FERS, the SF 2806 must be ‘frozen’ or ‘redesignated.’ Whether the SF 2806 is ‘frozen’ or ‘redesignated’ depends on whether the employee had enough prior service to have a CSRS component in a future annuity.” Thus, the FERS FROZEN designation has no affect on your ability to retire under the MRA+10 provision.

Tags: , , , , , ,

COLA

Bookmark and Share

Q. I retired Dec. 31, 2010, at age 60 and turned 62 on Dec. 11 under the FERS 60/20 retirement plan. I thought this would qualify for the 1.7 percent cost-of-living increase in 2013 as I did not get a COLA for two years per the conditions. Will I actually have to wait another year to qualify for a COLA as I am being told?

A. Yes.

Tags: , ,