FERS Retirement Eligibility.
(Updated 28 December 2018)
When can I retire from the Federal Service (OPM) under FERS (Federal Employee Retirement System)?
I get asked this question a lot.
I mean who doesn’t want to know when they can retire with an annuity (the federal government name for a pension)?
A lot of people also come here looking for this information in regard to the retirement of a federal employee who is in the middle of a divorce.
If you are the potential retiree, you, of course, want to know when you might be able to retire and when you might have to start paying your soon-to-be former spouse his or her share of your pension.
If you are the former spouse of a federal employee, you need to know:
- When your divorcing spouse is eligible to retire
- When s/he can start collecting payments
- What particular system the employed spouse was working under.
This article will try to stay on the simplified side of what can easily grow into a very complex subject.
The basics of FES eligibility is simple, but there are dozens of exceptions and extra rule which can make things hard to understand.
There are four categories of benefits in the Federal Employees Retirement System (FERS) Basic Benefit Plan:
In this article, I’ll cover the basics of Immediate retirement.
FERS Immediate Retirement
An immediate retirement benefit is one that starts within 30 days from the date you stop working.
If you meet one of the following sets of age and service requirements, you are entitled to an immediate retirement benefit:
If you are age 62 (or older) and have worked 5 years under FERS, you can retire immediately.
If you have reached age 60 and have 20 years FERS service you may also retire immediately.
Almost immediately, though, our simple little four-row table gets complicated.
Every FERS employee has a Minimum Retirement Age (MRA). In the next section, we’ll show you how to find yours.
The figures above cover all FERS employees except tohose eligible for “Special” retirement.
A special 20-year retirement system was created for certain designated positions which require employees to meet vigorous physical demands.
Because of the physical demands, this retirement system allows employees to retire sooner, with just 20 years of service.
It also includes a mandatory retirement when the employee reaches a designated age or years of service.
Eligibility to retire under the special 20-year provision depends on both the retirement system (CSRS or FERS) and the position held.
Positions covered under the 20-year retirement system
- Law Enforcement Officers (LEO)
- Firefighters (FF)
- Air Traffic Controllers (ATC)
- Nuclear Weapons Couriers (NWC)
What’s the FERS MRA (Minimum Retirement Age)?
Eligibility is determined by your age and number of years of creditable service. In some cases, you must have reached the Minimum Retirement Age (MRA) to receive retirement benefits. Use the following chart to figure your Minimum Retirement Age.
|If you were born||Your MRA is|
|In 1948||55 and 2 months|
|In 1949||55 and 4 months|
|In 1950||55 and 6 months|
|In 1951||55 and 8 months|
|In 1952||55 and 10 months|
|In 1965||56 and 2 months|
|In 1966||56 and 4 months|
|In 1967||56 and 6 months|
|In 1968||56 and 8 months|
|In 1969||56 and 10 months|
|In 1970 and after||57|
That’s Who the “MRA 30” Row is For
Those employees who have reached their MRA and have 30 years of service. In other words, if an employee has completed 30 years of service before s/he reaches his/her MRA, the employee is then eligible for immediate retirement.
What About Those Old Enough But Not Yet Having 30 Years of Service?
The “MRA 10” row on the table is for an optional retirement annuity for employees under FERS and at their Minimum Retirement Age (MRA) with10 to 29 years of service.
This benefit is commonly referred to as an MRA + 10 annuity.
It allows an eligible employee to receive an immediate annuity as early as age 55 with as little as 10 years of service.
However, there’s normally a reduction based on an employees number of years 5/12ths of 1 percent per month or 5 percent per every year you are under age 62 (60 if you have at least 20 years of service).
MRA +10 Reductions
As you can see from the explanation above, the reductions based on age can be difficult to estimate. As an example, an employee with 20 years of service retiring under MRA +10 rules at age 58 would have to give up more than $200 USD a month as an under-age penalty.
Fortunately, there’s a really great resource here that will help anyone with the need to know to get very accurate estimates of these sort of costs. Hat’s off to Fedcal.Com’s Essential Calculator.
Improper planning, or jumping at the chance to retire too early could result in long-term consequences, both for the employee in question and any divorced spouse expecting to collect a court-ordered share of the annuity.
Great care should be taken, in my layman’s view, to make sure agreements (preferably court-ordered) are made BEFORE a divorce is made final as to when the employed partner will retire and under what systems and options.
After the employee retires, the former spouse will still get his or her court-ordered share, but typically this is a simple percentage.
If the employed spouse reties too early or under the wrong set of rules, the former spouse’s income may be severely affected.
And typically, a retirement decision is final. Usually, there’s no going back one the retirement is in effect.
A state court can’t order OM to pay a percentage share of an annuity larger than the annuity the former employee receives.
So That’s The Basics of FERS Retirement Eligibility.