Question:
What is the best age to start receiving social security payments for US government employees under the FERS retirement system?
Answer:
For US government employees under the Federal Employees Retirement System (FERS), the best age to start receiving Social Security payments may depend on a variety of factors, including your individual financial needs, retirement savings, and other sources of income.
Under FERS, you are eligible for Social Security benefits as well as a FERS pension and the Thrift Savings Plan (TSP). If you are eligible for Social Security benefits, you can begin receiving them as early as age 62, but your benefit amount may be reduced if you start receiving benefits before your full retirement age (FRA).
For those born between 1955 and 1960, the FRA is 66 years and 2 months. If you were born after 1960, the FRA gradually increases until it reaches 67 years old. If you delay receiving Social Security benefits beyond your FRA, your monthly benefit amount may increase by up to 8% per year until you reach age 70.
When deciding when to start receiving Social Security benefits, it's important to consider your overall retirement plan, including your FERS pension and TSP savings. You may also want to consider other sources of retirement income, such as investments or rental property.
Ultimately, the best age to start receiving Social Security benefits under FERS will depend on your individual financial circumstances and retirement goals. It's important to consult with a financial advisor or retirement specialist to help you make an informed decision about when to start receiving Social Security benefits.
Q) How does the supplemental benefit part of FERS retirement work?
The FERS Supplemental Retirement Benefit is an additional benefit available to FERS employees who retire before they are eligible for Social Security benefits. The FERS Supplement is designed to bridge the gap between when an employee retires and when they become eligible to start receiving Social Security benefits at age 62.
The FERS Supplement is calculated as if you were eligible to receive Social Security benefits on the day you retired from federal service. This means that your FERS Supplement is calculated based on your years of federal service and your high-three average salary, just like your FERS pension.
To be eligible for the FERS Supplement, you must meet one of the following requirements:
- Retire with an immediate, unreduced FERS annuity before age 62 with at least 30 years of service;
- Retire with an immediate, unreduced FERS annuity at your minimum retirement age (which ranges from age 55 to 57, depending on your birth year) with at least 10 years of service and have your annuity reduced because of an age-based adjustment;
- Retire under the special provisions for law enforcement officers, firefighters, and air traffic controllers; or
- Be entitled to a deferred annuity at age 60, because you separated from service before you were eligible for an immediate annuity.
The FERS Supplement is paid out monthly and is subject to the same tax treatment as your FERS pension. However, unlike your FERS pension, the FERS Supplement is not eligible for cost-of-living adjustments (COLAs) until you become eligible for Social Security benefits.
It's important to note that the FERS Supplement is not the same as Social Security benefits, and eligibility for the FERS Supplement does not affect your eligibility for Social Security benefits. It's also important to consult with a financial advisor or retirement specialist to help you understand the details of the FERS Supplement and how it fits into your overall retirement plan.
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