FERS, Explained
FERS, the Federal Employees Retirement System, has covered new federal civilian employees with retirement coverage since it took effect on January 1, 1987, and a lot of them served in uniform first. It pays from three places: a FERS annuity, Social Security, and the TSP. This page is the plain map of the annuity part: when you can retire, how the check is figured, the supplement that bridges you to Social Security, what your military time is worth, and what you keep in retirement. Your agency's HR office gives the official estimate, and OPM decides the actual amount.
THE THREE LEGSAnnuity, Social Security, and the TSP
OPM describes FERS as benefits from three sources: a Basic Benefit Plan (the FERS annuity), Social Security, and the Thrift Savings Plan. Two of the three, Social Security and the TSP, go with you if you leave federal service before retirement. You and your agency pay into the annuity and Social Security each pay period, and the agency sets up and pays into your TSP account.
What you pay toward the annuity depends on when you were first hired, set in 5 U.S.C. 8422 as a percentage of basic pay minus the 6.2% Social Security rate:
| Who | Your FERS deduction |
|---|---|
| Most employees first covered by FERS before 2013 | 0.8% of basic pay |
| "Revised annuity employees," generally first hired in 2013 | 3.1% of basic pay |
| "Further revised annuity employees," generally first hired after 2013 | 4.4% of basic pay |
Prior federal service can change which category you are in, and law enforcement officers, firefighters, air traffic controllers, and a few other groups pay a higher rate; your earnings statement shows the deduction.
WHEN YOU CAN RETIREYour minimum retirement age, then the combinations
Many FERS rules turn on your Minimum Retirement Age (MRA), which OPM sets by birth year:
| If you were born | Your MRA |
|---|---|
| Before 1948 | 55 |
| 1948 to 1952 | 55 and 2 months, rising 2 months a year to 55 and 10 months |
| 1953 to 1964 | 56 |
| 1965 to 1969 | 56 and 2 months, rising 2 months a year to 56 and 10 months |
| 1970 or later | 57 |
| Kind of retirement | Age and service | Worth knowing |
|---|---|---|
| Immediate (starts within 30 days of leaving) | 62 with 5 years; 60 with 20; MRA with 30 | No age reduction |
| Immediate, MRA plus 10 | MRA with at least 10 years | Reduced 5% a year for each year you are under 62, unless you have 20 years and the annuity starts at 60 or later; postponing the start date shrinks or ends the reduction |
| Early (involuntary separation, or a voluntary offer during a major reorganization or reduction in force) | 50 with 20 years; any age with 25 | Only in those situations |
| Deferred (you left before qualifying) | At least 5 years of civilian service; payable at 62, or at MRA with 30 years, or at MRA with 10 (reduced as above) | No FERS Supplement, and no return to FEHB, FEGLI, or dental and vision coverage |
| Disability | 18 months of service, any age | The disability must be expected to last at least a year, and your agency must certify it cannot accommodate you or reassign you |
THE FORMULAHow the check is figured
Your high-3 is the highest average basic pay you earned in any three consecutive years, usually your last three. Basic pay includes salary increases that have retirement deductions taken out, such as shift rates; it does not include overtime or bonuses. The annuity is then:
| When you retire | The formula |
|---|---|
| Under 62, or 62 or older with fewer than 20 years | 1% of your high-3 for each year of service |
| 62 or older with 20 or more years | 1.1% of your high-3 for each year of service |
| Special provisions (law enforcement, firefighters, air traffic controllers, and a few others) | 1.7% for each of the first 20 years, plus 1% for each year after |
A worked example, arithmetic only. With a $95,000 high-3 and 25 years of service, retiring at 62 gives 1.1% × 25 × $95,000 = $26,125 a year; retiring at 60 with the same service gives 1% × 25 × $95,000 = $23,750. With 15 years at an MRA of 57, the MRA plus 10 annuity would be $14,250 before the age reduction, and 25% less (five years under 62 at 5% a year), about $10,688, if it starts at 57. These are not estimates of anyone's benefit; a married retiree's annuity is also reduced for a survivor benefit unless the spouse consents to less (section 6).
THE SUPPLEMENTThe FERS Supplement, the bridge to 62
If you retire before 62 on an immediate annuity that is not reduced for age (MRA with 30, or 60 with 20), OPM adds a FERS annuity supplement that stands in for the Social Security you earned under FERS until you can draw Social Security. It ends at 62 (or when you would first be entitled to Social Security, if earlier). If you retire involuntarily or in a reorganization before your MRA, it starts at your MRA. It is not paid with a deferred annuity, a disability annuity, or an MRA plus 10 annuity.
OPM figures it as if you were 62: it estimates your full-career (40-year) Social Security benefit and multiplies by your FERS years over 40. OPM's own example: a $1,000 full-career estimate and 30 years under FERS gives $1,000 × 30/40 = $750 a month. Like Social Security, it has an earnings test: it is cut $1 for every $2 you earn above Social Security's exempt amount for the year before, possibly to zero, while the rest of your annuity is not reduced.
MILITARY TIMEThe deposit, and what military retirees must know
Military service after 1956 can add years to your FERS annuity, but only if you pay a deposit, and you must pay it to your employing agency before you stop working for the government. The deposit is 3% of your military basic pay for service through 1998 and from 2001 on (3.25% for 1999 and 3.4% for 2000). Your servicing personnel office helps you decide whether to pay it and works out the amount from your records; DFAS explains the military service deposit for civilian employees.
SICK LEAVE, COLAS, SURVIVORSThe rest of the math
Unused sick leave is added to your service when your annuity is computed, but it does not help you reach eligibility, and it does not count in a deferred retirement.
Cost-of-living increases. FERS retirees under 62 generally get no cost-of-living increase until 62. The exceptions OPM lists: special-provision retirees (such as law enforcement, firefighters, and air traffic controllers), most disability retirees, and annuities with a part figured under CSRS rules.
Survivor benefits. If you are married, your annuity is reduced to provide a survivor benefit unless your spouse consents to less: a 50% survivor annuity costs 10% of your annuity, and a 25% survivor annuity costs 5%. If an employee dies while still working, a monthly survivor annuity can be payable to a spouse when the employee had at least 10 years of service, 18 months of it civilian, along with OPM's other survivor rules.
HEALTH IN RETIREMENTFEHB's five-year rule, and TRICARE
To keep FEHB in retirement, at the same cost as employees pay, you must retire on an immediate annuity (MRA plus 10 counts) and have been continuously enrolled in FEHB for the 5 years of service immediately before your annuity starts, or for all your service since your first chance to enroll if that is shorter. Coverage as a family member on someone else's FEHB counts, and so does time covered by TRICARE, as long as you are enrolled in FEHB when you retire.
If you are a retiree eligible for TRICARE, TRICARE For Life, or CHAMPVA, OPM lets you suspend FEHB and later reinstate it during Open Season, or right away if you involuntarily lose the other coverage. Our TRICARE guide and FEHB plan comparison cover the two sides.
THE TSP LEGYour own account, with the agency's 5%
The TSP is the leg you control. Your agency puts in 1% of basic pay from your first paycheck, contributed or not, and matches the first 5% you put in, so 5% from you brings 5% from the agency; the automatic 1% vests after 3 years of civilian service. The TSP guide's FERS section lays out the clock, the limits, and having both a military and a civilian account, and the TSP growth calculator projects a balance.
WHO TO ASKThe estimate and the doors
Your agency's human resources office prepares your annuity estimate on request (including the supplement and the survivor choices) and processes your application; OPM says to plan years ahead and to apply early. OPM Retirement Services determines the actual benefit from your certified record, issues your civil service annuitant (CSA) number, and runs Services Online once you are retired. For a rough number on your own, OPM offers the Federal Ballpark Estimate, and our federal employees page puts FEHB, GS pay, the TSP, and FERS on one screen.
OPM: FERS information · OPM: FERS eligibility and MRA · OPM: FERS computation · OPM: types of retirement and the annuity supplement · OPM: creditable service · OPM: service credit and the military deposit · OPM: military retired pay · OPM: survivor benefits · OPM: FEHB eligibility for annuitants · 5 U.S.C. 8422 (deductions)
