One of the most basic and common questions that we get all the time is when can I retire?
To get an accurate answer to this question for you, you have to look at all your personal affairs and situation. That being said, there are certain rules that we can use to know if you are eligible to retire under the FERS.
There are 3 major things that must be considered:
- Your Age (that you’d like to retire)
- Your Years of Creditable Service
- What type of retirement you’d like to choose
Note: You will need to be familiar with your MRA(Minimum Retirement Age). Here is a chart to help you figure out what it is for you.
- Born Before 1948…….55
- Born in 1948…………….55 and 2 months
- Born in 1949…………….55 and 4 months
- Born in 1950…………….55 and 6 months
- Born in 1951…………….55 and 8 months
- Born in 1952…………….55 and 10 months
- Born in 1953-1964…..56
- Born in 1965…………….56 and 2 months
- Born in 1966…………….56 and 4 months
- Born in 1967…………….56 and 6 months
- Born in 1968…………….56 and 8 months
- Born in 1969…………….56 and 10 months
- Born in 1970…………….57
- Born after 1970………..57
Let’s jump into the different types of retirement that are available under the FERS.
1. Immediate Voluntary FERS Retirement
This is the most common type and is often referred to as voluntary retirement. To be eligible for this retirement you must meet one of the following:
- Be your MRA with at least 30 years of service (MRA+30) or
- Be at least 60 with at least 20 years of service (60+20) or
- Be at least 62 with at least 5 years of service (62+5)
How to get a 10% BONUS in retirement
If you are at least 62 and have at least 20 years of service, you are eligible for a 1.1 multiplier when calculating your pension. This is a 10% increase from the regular multiplier of 1.
2. FERS MRA+10 Retirement
If you are not eligible for retirement under the immediate voluntary retirement you may be eligible for this type. You must have reached your MRA and have at least 10 years of creditable service. This option does allow you to retire earlier but does have a big downside. Your pension will be decreased by 5% for every year that you retire before age 62. (ie. if you retire 6 months before your 62nd birthday, your pension will be decreased by 2.5%)
Deferred and Postponed Retirements
If you qualify for the MRA+10 retirement, you have the to defer or postpone your pension if you want to avoid the penalty. This means that you can choose to wait to receive your pension until retirement(usually 62) and your pension will not be decreased. The big difference between deferred retirement and postponed retirement is that those that postpone their retirement will be eligible for FEHB (assuming they qualified when they where employed) when they start drawing their pension and those that deferred their pension would not be eligible. This is a huge benefit!
3. Involuntary or Discontinued Service Retirement/ FERS Disability Retirement
These two types of retirements have many rules and exceptions that it is hard to come up with rules of thumb. If you find yourself considering these options make sure you are well educated on the pros and cons of your decision.
Why type of FERS retirement is right for me?
It is in your best interest to become very well versed in what retirement options are available. Your choice can affect the rest of your life and your families life and sometimes in an irreversible way.
Retirement can be amazing. Especially when you go into it with your eyes wide open understanding all your incredible federal benefits.
