Ask The Experts: Retirement

By Reg Jones

Vested employee

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Q. Once I get vested after five years of being in the federal system, and perhaps I leave the job a month later. Where can I find, or how can I calculate, how much I’ll get when I retire?

A. If you leave you contributions in the retirement system, you’d be entitled to a deferred annuity at age 62. That annuity would be computed using this formula: .01 x your high-3 x your years and full months of service.

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High-3 calculation

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Q. I have been a federal employee for Homeland Security for 6-1/2 years. I have been medically disqualified from my job. I am going to try to get disability. I have worked full time for the first 4-1/2 years, and went part-time down to 25 to 30 hours a week. Will they use the highest three salaries, even if when discharged I was working part-time for the agency? How does the calculation work for this situation?

A. An employee’s full-time salaries are used in determining his high-3, even if he is in a part-time position.

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Location and high-3

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Q. I am a Defense Department employee in Washington D.C. If I change my locality three months before I retire Jan. 1, when I retire would the lesser locality pay kick into my base and be used as the high-3?

A. How may times do I have to say this? Your high-3 is your highest three consecutive years (78 pay periods) of average basic pay, regardless of when they occur in your career.

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Night differential

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Q. Is night differential (shift work) added to my high-3 when calculating my retirement annuity?

A. No, it isn’t, unless you are a wage system employee. Then it is.

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High-3 computation

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Q. Between 2009 and 2012, I served two deployments in Afghanistan as a GS employee (CSRS). Can my salary during those deployments be used in the computation of my high-3?

A. No. Only actual basic pay earned while a federal civilian employee can be used in that computation.

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Leave without pay and creditable service

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Q. In 2011, I left my civil service job for 175 days to deploy to Afghanistan as an active-duty officer. While deployed, I used a day or two of annual or military leave every pay period to pay for my health care benefits. FERS payments also were made on the days I was on paid leave.

When I got back from my deployment, I was told I had to buy back the time, and I put in paperwork with DFAS to do so. However, I just read in my agency’s furlough FAQ that: The amount of a CSRS or FERS annuity paid by the Office of Personnel Management (OPM) is based primarily on the amount of creditable service an employee performs and the employee’s high-3 average salary.

Both CSRS and FERS allow service credit for up to 6 months of nonpay status in any calendar year. If a furlough period does not cause an employee to be in a nonpay status for more than 6 months in a calendar year, the furlough period will be included as creditable service in determining the employee’s total creditable service used in the annuity computation. If the total amount of time an employee spends in a nonpay status in a calendar year exceeds 6 months, the amount of nonpay status in excess of 6 months in the calendar year will not be creditable for retirement purposes.

Based upon this, it looks like as long as I was not in a nonpay status for six months that calendar year, I do not have to buy back that time for it to count toward my retirement. Am I correct in my interpretation of this? If so, is there a way to verify how many creditable years I have?

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Benefits for retiring at 65 with 29 years

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Q. I’m a FERS employee thinking of retiring at the end of 2014.

I’ll be 65, and with time served, military and sick leave (barring any lengthy illness between now and then), I’ll have 29 years, plus a couple of months. I know I’ll be losing some benefits from Social Security, leaving a year early, but what would the loss be from leaving before the 30-year mark?

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CSRS retirement and Social Security

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Q. I have been a federal employee with the Department of Veterans Affairs covered by CSRS since October 1977 and have four years of military service (I paid the military deposit in full). I am 75 and have started receiving Social Security. I will be retiring in about one year and eight months, having reached 41 years and 10 months years of service, including military service, hoping to have earned or reached the 80 percent retirement annuity. I am at the top level of my GS-12 grade step 10. What will my civil service and Social Security benefits be? Or, how I can estimate the figure?

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Military buyback

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Q. I am a retired soldier with 21 years of service being paid my retirement. I am also a GS FERS employee with 13 years of service. I am 56 and would like to retire in about two years. I have asked for my calculation to see if I should buy back my service time. I assume that if I buy back my time, my military retirement stops immediately. I used your calculator to check my FERS retirement and believe I got the right number for just the 13 years. If I retire under the MRA+10 provision, will I basically get my current military retirement pay plus the 13 years of civil service calculations together, or do you use a different formula? I also assume even if I buy time back, I will retain my military benefits. Should I immediately buy back the time or wait until I’m closer to retiring?

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Retirement after 22 years in CSRS

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Q. How much will my retirement be when I turn 62?

I rotated back to the states after more than 22 years of federal service. I was effectively terminated from my position due to the five-year rule in Europe. I was under CSRS.

I will not turn 62 for five years, but I would like to know how to get information regarding my CSRS account status.

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Retirement and insurance with more than 30 years in CSRS

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Q. I am 55 with 36 years of federal employment, including two one-year breaks in service. The last break was in 1985. I withdrew the funds I had paid into CSRS each time I broke service and have repaid a minimal amount of it. I thought I would be one of those people who worked forever; however, I have a progressively degenerative medical condition and likely will not be able to work more than another year at the most. I am totally ignorant about retirement and to what benefits I am entitled. For example, will my pension benefits be reduced because I am retiring early? Do I continue to pay the same health insurance rates once I retire until I become eligible for Medicare? Will my health benefits remain the same until I become eligible for Medicare? I used the pension calculator and am more confused. For example, I calculated using the percentage for the first five years and the different percentage for the next five years, and then the 2 percent for the remaining years past 10. Is this the amount plus interest, plus matching funds what I pay into CSRS from my paycheck, or do I have to do yet other calculations? I have requested a meeting with my HR department, but it has to wait until it receives information for payroll and tells me it will be weeks before I can get a meeting. My neurosurgeon and neurologist are telling me I should consider retiring immediately, but I need to make this major decision as knowledgeably as possible.

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Law enforcement retirement as early as possible

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Q. I’m 44 with 16 years in a covered federal law enforcement position plus three military years (which I haven’t bought back yet). How soon can I retire? When I reach 20 years in service, I’ll be only 48, or do I have to wait to reach 50? Could I retire then, and if so, what would I be leaving on the table?

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Basic pay for retirement

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Q. As a WG/WL shift worker who change days off every four weeks and works Sunday premium days and all holidays, can I count on these extras in my retirement pot? I am almost certain that overtime and bonuses are not included. I have looked in 2012/2011 almanac for the answer. To me, the almanac is geared toward the GS side of the family. I am planning on retiring soon after 41 years. From what I can see, my high-3 is based on straight M-F day shift base pay.

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Basic annuity calculation

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Q. I started working for the federal government March 10, 1975. If I retire Dec. 31, 2015, by my calculations, I will have 40 years, nine months and 21 days.

Right now I have 1,142 hours of sick leave but have no idea how many I will have when I retire. Will any of that be counted toward year and months of service? I’m only a GS 7, step 10, so I need to know what percentage of my retirement pay I would get. My high-3 is more than $50,400 with locality pay. I understood that where you are living and getting locality pay would be figured toward the annuity. If they change our retirement to the high-5, in two years I will still be at the same salary.

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Annuity after retiring at MRA+10

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Q. I worked for the Department of Defense as a civilian physician for 16 years and then transferred to the Veterans Health Administration. I understand physician comparability allowance is part of basic pay for retirement for VHA. So, if I worked for the VHA for two years and then retired because I am at minimum retirement age plus 10, how would my annuity be calculated?

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Leave of absence, retirement and high-3

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Q. I’m going to be doing charity work for several months in 2014. I’m considering requesting a leave of absence for it (I understand such leaves are at the discretion of management). If I’m not granted the LOA and I resign, how will a few months (seven to eight total) affect my retirement? I plan to rejoin federal service after the charity event. I’ve consulted my local HR department and OPM, but I’ve received conflicting information.

If I’m granted the LOA, is my high-3 affected by such an absence? Then, assuming I’m not granted the LOA and I resign, can I rejoin federal service with the high-3 intact? Lastly, do I lose my high-3 if I withdraw funds from TSP just before the LOA or resignation? That is the big one for me — some people tell me if I touch my TSP, I lose my high-3.

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Disability retirement and annuity recalculation

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Q. I am on disability retirement from the Federal Bureau of Prisons. I have 13 years of service and fall in the MRA bracket born in 1953-1964. When will my annuity be recalculated? Will my annuity be more than what I am receiving on disability?

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Pension amount

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Q. I retired from the military after 22 years of active duty and receive a VA pension and 10 percent disability pension. Since then, I have been in the federal government for 10 years, and I hope to retire at 20 years and 62 years old. What will my retirement look like?

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High-3 and pay differentials

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Q. I am a federal worker at a VA hospital. I am a General Schedule employee under CSRS. I switched to night shift and work lots of weekends to boost my last three years of earnings. I read in OPM under CSRS/retirement/High-3 Average Salary, “Your basic pay is the basic salary you earn for your position. It includes increases to your salary for which retirement deductions are withheld, such as shift rates. It does not include payments for overtime, bonuses, etc.”

I still am not sure if night shift will work out to a bigger retirement annuity. I make plenty more in my night differential pay for night tour. What I noticed is retirement deductions in my Pay Statements remained the same as before when I worked the day shift. This is puzzling.

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Part- and full-time work and high-3

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Q. How is my annuity reduced after working full time for seven years, part time for 10 years and then full time for an additional 13 years? Is it still the high-3, or is there a reduction because of less money contributed for those 10 part-time years?

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