FERS retirement at 62?

[ripper]

A co-worker told me that he's waiting until age 62 to retire because at that age he'll receive 1.1% for each year of service instead of 1.0%. This was the first I've heard of this and I was unable to find any evidence to support this. Is this true?

 

[burrocrat]

A co-worker told me that he's waiting until age 62 to retire because at that age he'll receive 1.1% for each year of service instead of 1.0%. This was the first I've heard of this and I was unable to find any evidence to support this. Is this true?

i believe that after 20 years of service you get 1.1% for each total years of service. if you have less than 20 years in, then you get 1% per year. all the other rules about minimum retirement age, social security, etc. still apply.

so after 30 years of service your fers pension should be 30 years x 1.1% of average high 3 salary, or about 1/3rd of what you made while working. if you are really good then tsp withdrawals might provide you with another 1/3rd. and if you are really lucky the social security empty lockbox won't be busto and can still borrow from current wage earners to provide you with another 1/3rd. this is why they call it a 3-legged stool i think. then you can sit around in your own stool and enjoy retirement with virtually no loss of income.

 

[ripper]

i believe that after 20 years of service you get 1.1% for each total years of service. if you have less than 20 years in, then you get 1% per year. all the other rules about minimum retirement age, social security, etc. still apply.

so after 30 years of service your fers pension should be 30 years x 1.1% of average high 3 salary, or about 1/3rd of what you made while working. if you are really good then tsp withdrawals might provide you with another 1/3rd. and if you are really lucky the social security empty lockbox won't be busto and can still borrow from current wage earners to provide you with another 1/3rd. this is why they call it a 3-legged stool i think. then you can sit around in your own stool and enjoy retirement with virtually no loss of income.

My understanding is that it's 1% for each of the first 30 years and 1.1% for each year after that. But I don't recall ever hearing anything about it changing when you reach 62.

 

[Valkyrie]

yrs of service do not figure into this. retire at 62 or older and 1.1% is used, before 62 1% is used. before 62 a supplement paid by OPM is paid to take the place of what SS is at 62. COLAs do not start until 62 even if one retires before 62.

 

[Kaufmanrider]

Valkyrie is correct. Here is the link to OPM. http://www.opm.gov/retirement-services/fers-information/computation/

Different calculation if your FERS Special (LEO/FF/ATC)

 

[burrocrat]

from kauffman's link it appears to get the 1.1% requires that you have both 20 years of service and be age 62? even if 62 yo but not 20 years then only 1.0%? and if 20 years but not 62 yo then only 1.0% also?

 

[Cactus]

Actually years of service do figure in. As I understand it you have to have at least 20 years and retire at 62 or later to get the 1.1%. Technically you could retire with as little as 5 years of service at 62 but you only get the 1%.

 

[alevin]

pretty much. for me, it would be 62 and 32. Don't know if can stand to wait til 62, even for the extra 0.1%. I'll figure it out in next couple years how much longer to stay after 30. or agency budgets may figure it out for me sooner. hard to say at this point.

 

[Cactus]

Don't want to change the topic too much, but on a related note I see from Kaufmanrider's link that ATCs get 1.7% for the first 20 years. Are there any controllers out there? The link sounds like you actually have to retire as a controller. Is that correct? If you go on and do something else for the government and then retire do you lose the 1.7% for the years you were an ATC?

 

[weatherweenie]

Computation

[TABLE="class: DataTable"]
FERS Basic Annuity Formula[TR="class: header"]
[TH]Age[/TH]
[TH]Formula[/TH]
[/TR]
[TR]
[TD]Under Age 62 at Separation for Retirement, OR
Age 62 or Older With Less Than 20 Years of Service[/TD]
[TD]1 percent of your high-3 average salary for each year of service[/TD]
[/TR]
[TR]
[TD]Age 62 or Older at Separation With 20 or More Years of Service[/TD]
[TD]1.1 percent of your high-3 average salary for each year of service[/TD]
[/TR]
[/TABLE]

 

[Cactus]

alevin, the way I look at the 1% vs 1.1% is it's a 10% bonus for sticking around another couple of years. In my case it's going to pay for the 10% reduction I take for survivor benefits. I can do two more years for that. Plus with my TSP performance I need the time.

 

[Valkyrie]

Actually years of service do figure in. As I understand it you have to have at least 20 years and retire at 62 or later to get the 1.1%. Technically you could retire with as little as 5 years of service at 62 but you only get the 1%.

yep, I was answering ripper's post and forgot about that 20 yrs thing, since it never applied to me. 56 w/32 next yr, planning on last pay period in '15 to be gone. FY16 will not be pleasant for those who stay around.

 

[Lindoug]

Actually years of service do figure in. As I understand it you have to have at least 20 years and retire at 62 or later to get the 1.1%. Technically you could retire with as little as 5 years of service at 62 but you only get the 1%.

However, if you go out on a Disability Retirement before the age of 62, once you reach the age of 62 the annuity is re-calculated at the 1.1%.

 

[scaredstiff]

What if someone is offered a VERA/VSIP I have 27 years and 59 would I get the 1% only if I go.

 

[Lindoug]

you have to have at least 20 years AND retire at 62 or later to get the 1.1%.

 

[Cactus]

However, if you go out on a Disability Retirement before the age of 62, once you reach the age of 62 the annuity is re-calculated at the 1.1%.

Thanks for that info; that's good to know!

A word to the wise, though, you don't get a medical retirement if you already qualify for a regular retirement. We had a guy in the office get a medical last July when he could of retired in August. The way the dates on the paperwork lined up had them retract his medical retirement in September in favor of a standard 30 year FERS retirement. He also had to pay back the difference he'd received so far.

 

[ripper]

Thanks for the feedback, everyone.

I went back and checked the sight where I thought that it said you only received the extra 0.1% for over 30 years, but it now says what others have pointed out here - 1.1% if you are at least 62.

I was planning on retiring three months short of my 61st birthday. Now I need to decide if it's worth it for me to work an extra 15 months.

 

[Boghie]

Something weird Ripper...
Something that nobody has talked about...
But, something that 'I heard' was true, but haven't verified...

I think that 1/2 of your accrued Sick Leave counts toward your years. So, I think you can take 1/2 of your sick leave off the 15 months left.

 

[konakathy]

Something weird Ripper...
Something that nobody has talked about...
But, something that 'I heard' was true, but haven't verified...

I think that 1/2 of your accrued Sick Leave counts toward your years. So, I think you can take 1/2 of your sick leave off the 15 months left.

As of January 1, 2014 FERS folks can apply 100% of accrued SL towards their years. I won't have zip. I always followed the old philosophy "use it or lose it."

 

[DreamboatAnnie]

I will hit my 30 years of service the year before I become 56, which is my minimum retirement age. To get that extra .1% of 1% for each year of service, I would need to work 6 more years and would then have 36 years of service. That would give me 36% for the 36 years of service at 1% PLUS 3.6% (36x .01) for a total of 39.6% at age 62 as opposed to 30% if I retire at age 56.

That is almost 10% for 6 more years, or about a third more then I would be getting from FERS otherwise.

I still want to retire at 56!! But folks are living longer so who knows...depends on health and personal financials.