By: Phil Gardner, Federal Benefits Specialist
Published: June 20, 2019
Getting ready to retire? Your agency benefits officer wants you to start the process 3 to 6 months ahead of your retirement date. Here are some things to think about before setting up your meeting. Your benefits officer will provide you with full details and an estimate of your annuity.
Are you eligible to retire? You are eligible for voluntary retirement when you are:
- At least age 55 (CSRS) or under FERS, your Minimum Retirement Age (MRA) between age 55 and 57 which is based on your date of birth and have at least 30 years of creditable Federal service; or,
- At age 60 (CSRS and FERS) and at least 20 years of service; or,
- At least age 62 (CSRS and FERS) and at least 5 years of service.
- Under FERS, you are also eligible to retire at your MRA with only 10 years of service. However, your annuity will be reduced 5% per year for each year or part of a year you are under age 62. You can postpone the commencing date up to age 62 to reduce or eliminate the reduction.
Have you completed deposits due for military service or civilian service not covered by retirement contributions or redeposits for civilian service for which you took a refund of retirement contributions?
- Military service deposits must be completed before you separate them for retirement. OPM cannot accept a military deposit after retirement.
- OPM will give you a final opportunity to pay civilian deposits and/or redeposits when processing your retirement application.
Have you considered survivor benefits?
- Under CSRS, you may elect a survivor benefit for your spouse based on 55% of any amount you select up to a maximum of your full annuity.
- Under FERS, you may elect a survivor annuity for your spouse based on 50% (maximum) or 25% of your annuity.
- An election of less than the maximum survivor benefit, including no survivor benefit, requires spousal consent to that election.
- Your spouse will not be able to continue your health insurance unless you elect a survivor annuity and they are covered under your enrollment the day you pass away.
- You may elect an insurable interest survivor annuity of 55% of the reduced annuity for a close relative or someone who relies on you for support. You must be in good health to make this election. If you are married, this election requires spousal consent.
Do you plan to continue health and life insurance into retirement? You must be covered for at least the 5 years of service immediately prior to retirement and retire on an immediate annuity.
Do you have an outstanding TSP loan?
- You must pay off your outstanding TSP loan balance within 90 days after your retirement or the balance will be reported as a taxable distribution.
- You cannot withdraw your TSP account until the loan is closed.
- You will receive a letter from the TSP shortly after your retirement advising you of the amount due, payment due date, and the date the taxable distribution will be declared if not paid.
Phil Gardner is a Federal Benefits Specialist with the National Institute of Transition Planning, Inc. He recently retired from the U.S. Office of Personnel Management (OPM), following a 41-year career.