Retirement & Benefits

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Federal Employees Retirement System (FERS)

Detailed information on this topic can be found at: www.opm.gov/asd/htm/hod.htm or by contacting a member of the Retirement and Benefits Staff by calling (301)504-1526.

Coverage

Generally, all Federal civilian employees first hired after 1983 are automatically covered by FERS. In addition, employees rehired after 01/01/84 who had less than five years of prior creditable civilian service as of 12/31/86 are mandatorily covered by FERS. An employee previously covered by CSRS/CSRS-Offset who has a break in service of 4 or more days, depending on the type of appointment, can elect FERS coverage voluntarily during the first six months of the appointment.

FERS is a three-tiered retirement plan consisting of these components:

    1. Government Annuity
    2. Social Security
    3. Thrift Savings Plan (TSP)

The following information provides details on the first of the three tiers, the government annuity portion. For more information on the Social Security go to: http://www.ssa.gov/retire2/. For more information on TSP: http://tsp.gov/

Deductions

An employee covered by FERS pays .08% of basic pay to FERS and 6.2% to Social Security and 1.45% to Medicare.

Eligibility

Employees must meet one of the age and service requirements (see next page). They must have at least five years of Federal civilian service. They must be separated from a position subject to FERS coverage.

Type of Retirement	Year of Birth	Minimum Age	Minimum Service for Unreduced Benefits (Years)	Minimum Service for Reduced Benefits **	Special Requirements
Optional	NA NA Before 1948 1948 1949 1950 1951 1952 1953-1964 1965 1966 1967 1968 1969 1970 & After	62 60 55 55 & 2 months 55 & 4 months 55 & 6 months 55 & 8 months 55 & 10 months 56 56 & 2 months 56 & 4 months 56 & 8 months 56 & 10 months 57	5 20 30 30 30 30 30 30 30 30 30 30 30 30 30	N/A N/A 10 10 10 10 10 10 10 10 10 10 10 10 10	None None **Reduction is 5 percent for each year the employee is under 62 Employees may postpone receipt of the retirement benefit to a later date to lessen the reduction.
Early Optional	NA NA	50 Any	20 25	N/A N/A	Major Reduction in Force
Deferred	NA	Any		5	If less than 10 years service, eligible for unreduced benefit at age 62. If 10 or more years service, may take benefit at any time after attaining minimum retirement age (see ages under optional). Benefit will be reduced by 5% for each year younger than 62. There will be no reduction if employee had at least 20 years service and defers receipt of benefit until age 60 or if employee had at least 30 years service.
Discontinued Service	NA NA	50 Any	20 25	N/A N/A	Involuntary separation for reasons other than conduct or delinquency.
Disability	NA	NA	18 months		Disabled for position
Special Retirement Provisions	NA	50 Any Age	20 25	NA NA	Applicable to law enforcement officers and firefighters

Creditable Service

Civilian Service - Federal civilian service during which FERS contributions were withheld and not refunded.

Military Service - Active duty in the uniformed forces of the United States performed on a full- time basis. Military Service performed prior to 01/01/57 is automatically creditable for retirement purposes. A deposit is not necessary. Employees may only receive credit for their military service performed after 12/31/56 if a deposit in the amount of 3% of the military basic pay (earned during the period of military service) plus interest has been completed. For employees first employed on or after January 1, 1987, interest begins to accrue on military deposits 2 years after an individual is first employed (or re-employed after a period of military service) in a position subject to FERS. For employees first hired prior to January 1, 1987, the 2 year grace period ends on January 1, 1989. Interest accrues during calendar year 1989 at the variable interest rate for the year and is posted on January 1, 1990 and each January 1 thereafter.

To find out more about the payment of any deposits or redeposits, please contact a member of the Retirement and Benefits Staff by calling (301)504-1526 or go to http://www.afm.ars.usda.gov/hrd/benefits/cp-servi.pdf for more information.

Pre-1989 Non-Deduction Service - Federal civilian service during which no retirement contributions were withheld, also called "temporary service" or "FICA Service". This service will only be credited if a deposit to the retirement system is completed. Non-deduction service on and after January l, 1989 is not creditable.

Refunded Service - Federal civilian service during which CSRS contributions were withheld and later refunded to the employee will be credited only if the employee makes a redeposit.

NOTE: If FERS contributions are refunded, the employee permanently loses credit for that service for retirement eligibility and computation purposes. Employees cannot make a redeposit for refunded contributions after being covered by FERS.

    An employee who is automatically covered by FERS and had some previous service under CSRS, but not enough to meet the 5-year test and took a refund, must pay the redeposit to receive credit for both eligibility and computation purposes.

    Employees who elect to transfer to FERS may receive annuity computed partly under FERS rules and partly under CSRS rules. An employee who has 5 or more years of creditable civilian CSRS Service (excluding any CSRS Offset Service) will be entitled to benefits computed under CSRS rules for service prior to transferring to FERS.
        

Retirement Computation

If the retiree is:

• under age 62, or
• over age 62 with less than 20 years of total service
  1 % x high-3 x years and months of service

If the retiree is:

• at least age 62, and
• has 20 or more years of total service
  1.1 % of high-3 x years and months of service
  

Disability Retirement

If you become disabled during the course of your Federal career, you may be entitled to a disability annuity under FERS. You must complete at least 18 months of Federal civilian service; and while employed in a position covered by FERS become disabled for “useful and efficient service” in both your current and any vacant position at the same grade or pay level for which your are qualified.

Death Benefits

The Basic Employee Death Benefit is payable in a lump sum to an eligible spouse upon the death of an employee who has completed at least 18 months of creditable civilian service and died while subject to FERS.

Upon the death of an employee, a monthly survivor annuity is payable to an eligible spouse if the employee completed at least 10 years of total creditable service, which includes 18 months of civilian federal service, and died while subject to FERS. If a survivor benefit is not payable, a lump sum payment of the retirement contributions is paid to the eligible beneficiary. If there is no designated beneficiary, the lump sum is paid according to the order of precedence under Federal Law.

Detailed information on any of these topics may be found at: www.opm.gov/asd/htm/hod.htm
If you have questions or need assistance please contact a member of the Retirement and Benefits Staff at (301)504-1526.