Retirement system error

[alevin]

I missed being a CSRS Offset employee by 6 days. Pits.

If you intend to retire from government then get into the CSRS kicking and clawing if you have to. The CSRS retirement annuity is MUCH better than the FERS one is.

Hi XL-entLady, I've been reading this thread since it started, but still not sure what was meant when you said you missed being CSRS-Offset by 6 days. You were 6 days late (?) and ended up as straight FERS (because you got on in midJan 1987?) And think you could have chosen to get into CSRS system instead, if you had gotten in slightly sooner, during CSRS-Offset window (like me-mid-late 1986)? Am I understanding you correctly?

Since I have 1 month of CSRS-Offset time on my record (which I only discovered fairly recently), your comments made me wonder if I could have somehow chosen to go CSRS at some point instead of FERS and didn't know it. TIA-still confused.

 

[XL-entLady]

Hi XL-entLady, I've been reading this thread since it started, but still not sure what was meant when you said you missed being CSRS-Offset by 6 days. You were 6 days late (?) and ended up as straight FERS (because you got on in midJan 1987?) And think you could have chosen to get into CSRS system instead, if you had gotten in slightly sooner, during CSRS-Offset window (like me-mid-late 1986)? Am I understanding you correctly?

Since I have 1 month of CSRS-Offset time on my record (which I only discovered fairly recently), your comments made me wonder if I could have somehow chosen to go CSRS at some point instead of FERS and didn't know it. TIA-still confused.

I was hired the first week in January of 1984. If I'd been hired 6 days earlier I would have been CSRS. I wasn't actually eligible to be Offset. There was something about the way things were being reported during the change-over that had some time reported as "offset" during that time, even though we weren't able to choose retirement systems like true Offset employees could. I had an HR person explain it to me once. But I don't remember what she said after all these years.

Here is some OPM information that may clarify things for you (or it may not - I got it from the OPM website!:cheesy:

"Prior to January 1, 1984, there was only one major retirement system for Federal employees. Federal employees who were eligible for retirement coverage were covered by the Civil Service Retirement System (CSRS). By law, Federal employees covered by CSRS were excluded from Social Security coverage and taxes.

"The Social Security laws were changed in 1983 to require Social Security (FICA) coverage for most new Federal employees hired after December 31, 1983, or employees who were rehired after December 31, 1983, after a break in CSRS coverage of more than 1 year. These employees were placed in an interim retirement plan that provided for full Social Security (or OASDI) deductions from pay and reduced CSRS deductions. This was the precursor of the CSRS Offset plan.

"On January 1, 1987, the new Federal Employees Retirement System (FERS) started. Most Federal workers are covered by either CSRS or FERS. However, in the legislation that created FERS, Congress also created the CSRS Offset plan.

"Typically, CSRS Offset retirement applies to employees who had a break in service that exceeded 1 year and ended after 1983, and had 5 years of creditable civilian service on January 1, 1987. CSRS Offset retirement coverage also applies to employees hired before January 1, 1984, who acquired CSRS coverage for the first time after that date, and had at least 5 years of creditable service by January 1, 1987."


Lady

 

[alevin]

Hi XL-Lady, may I add one more "glad you're back"? Thanks for answering my CSRS-Offset question, it explains that whole deal far better than I've heard it explained up to now. Funny how it showed up in my records tho, even a little bit, considering I did have a break in service (sort-of-it was called leave without pay, actually) as a coop-ed student in 86-87, but I didn't have anything close to resembling 5 years of creditable CSRS service prior to the 1987 date.

Anyway, sounds like I never did meet the fullmeal deal timingwise for CSRS pure and simple and there were no mistakes about ending up in FERS for the long haul, which is what I've been wondering about ever since I saw your post. I gather you wish you'd had the chance to be in FERS, that wasn't quite clear to me earlier. Hope your retirement is long, happy and filled with delightful grandkids.

 

[Texarkandy]

Not so fast............ (AT LEAST IF YOU ARE ATC)

My co-worker and I smile to ourselves as the CSRS crowd revels in thier percieved superior package.

We are some of the 1st FERS in '84. Our friend was fall of '83 and CSRS. Lets compare. Both have 31yrs "good" time.

I will go at 31 years at my MRA (56) And therefor qualify for a rather funky provision giving me 1.7% for each year of "good" time.

This equals 52.7% of an assumed 120k = $63240/yr
CSRS bud.. 58.0% of 120k = $69600/yr

We also get the supplement, figured at..... 31yrs divided by 40yrs(full SS qualifier) equals .775 times projected benefit of $18000 = $13950

$63240 + $13950 = $77190. We're already $7590/yr ahead.

But CSRS gets fulL COLA, while we get COLA minus 1%........ so we start losing ground right away. Plus our supplement gets NO COLA until you convert to real Soc Sec at age 62...... so more lost ground.

But as we TSP'ers know..... the real kicker is the TSP.

My CSRS pal has roughly $200k in his Thrift...... while I have ......much more.

Applying same %'s to the TSP accounts for next 7 years...
I'll have about $1M more than he.

At a mere 5% safe return per year, that's $50k per year, not touching the principle to leave to my kids..........

That's probably more than $50k per yr more than he.... plus $500k left to each of my kids....

I'm happy with my FERS.

Well, Traffic Dog, I'm qualified for the same "funky" 1.7% provision you are. I'm relatively happy with how things are going to turn out, but there's no way you can argue FERS is = or better than CSRS for us folks. You are perhaps not taking into full account how much we had to contribute to get our retire bennies.

In comparing my soon-to-come FERS retirement at about 50 y/o to CSRS here is what I've figured out.

30 years of "funky" time (26 LEO + 4 bought-back Mil - fully invested in TSP the whole time - mostly C fund & fortunately dumped it all in G before the market drop last year)

I won't bore you with all the $ numbers, but:

Here's how my FERS Retirement will be - FERS Pension + Supplement + TSP Equal Monthly Payments = approx 63% of high-three

CSRS "funky" retirement would have been a flat 70% of high-three (had I been hired 4 months earlier than I was.)

However - you have to remember that as FERS I contributed approx 24% of salary over the years to get my retirement (1.7% to FERS + 15% to TSP + 7.65% to SS)

As a CSRS employee I would only have contributed 7% of my salary and would have been able to invest the other 17% over the past 25 years.

I'll also probably have to start taking my SS at the reduced age of 62 because my FERS supplement will stop coming at age 62.

It would also be nice to get a few more years of SS earnings paid in after I retire from the Fed - but I better do it before age 55 when they will start reducing my FERS supplement for every $ I make over 13K a year.

 

[Texarkandy]

Not so fast............ (AT LEAST IF YOU ARE ATC)

My co-worker and I smile to ourselves as the CSRS crowd revels in thier percieved superior package.

We are some of the 1st FERS in '84. Our friend was fall of '83 and CSRS. Lets compare. Both have 31yrs "good" time.

I will go at 31 years at my MRA (56) And therefor qualify for a rather funky provision giving me 1.7% for each year of "good" time.

This equals 52.7% of an assumed 120k = $63240/yr
CSRS bud.. 58.0% of 120k = $69600/yr

Hold up there Traffic Dog - perhaps ATC is different from Fed LEO's in a way I don't know about, but I thought they were essentially the same - my understanding is I only get the 1.7% calculation for the first 20 years of my "covered" time - & 1% for all years thereafter (or before) including military-bought-back time.

Example: I'll have 25 years FERS "funky" coverage as an LEO, the last 5 years will be calculated at 1% (even though I'm still paying in 1.7% to the retirement system) My bought back military will also be figured at only 1%.

20 yrs "covered" time x 1.7% = 34%
5 years extra "covered" time x 1% = 5%
4 years bought-back military x 1# = 4%
Total FERS Pension as a % of high-three = 43%

We also get the supplement, figured at..... 31yrs divided by 40yrs(full SS qualifier) equals .775 times projected benefit of $18000 = $13950

$63240 + $13950 = $77190. We're already $7590/yr ahead.

Note: After we turn 56 supplement will be reduced by $1 for every $2 in outside wage earnings over 13K. And no COLA on the supplement - ever!

But CSRS gets fulL COLA, while we get COLA minus 1%........ so we start losing ground right away. Plus our supplement gets NO COLA until you convert to real Soc Sec at age 62...... so more lost ground.

Sucks.

But as we TSP'ers know..... the real kicker is the TSP.

My CSRS pal has roughly $200k in his Thrift...... while I have ......much more.

Applying same %'s to the TSP accounts for next 7 years...
I'll have about $1M more than he.

At a mere 5% safe return per year, that's $50k per year, not touching the principle to leave to my kids..........

That's probably more than $50k per yr more than he.... plus $500k left to each of my kids....

I'm happy with my FERS.

I haven't done "quite" as well in TSP - but then I've only been a FED TSP'er for 24 years & going to early retire at 25.5 years. Maybe if I stay on for 7 more years though? hmmmmm? - NOT!

I'd rather have been CSRS all this time, but don't whine too much cause all things considered I'm still happy with my FERS Special Coverage as opposed to regular coverage or private sector. (although I know of at least one retired big-city police officer who gets 90% of high-five - no medical insurance benefit though for retirees._

I'm figuring mine will work out to roughtly: 43% FERS Pension + 10% from Supplement + 10% from TSP Equal Monthly Payments based on Life Expect. = 63% of high three. But I'll only be 49 y/o!

I wish some of these forums would have special sections dedicated to the ATC/FF/LEO Special coverage.

 

[nnuut]

CSRS!!!! 1 year and 4 month = 37 years = 70.25% of high 3. 40% of my earned Social Security, due to WEP, And my TSP! I'll take it!!:laugh: