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FERS Retirement Choices

Did you know that there is a retirement plan available for civilian employees that covers everyone employed in the legislative, judicial, and executive branches of the federal government? It’s likely that you don’t know what the Federal Employees Retirement System (FERS) is if you’re not a government employee. But if you plan to get a job in the public sector in the future, you will most certainly get to know it well. 

In this article, we explore the various FERS retirement choices available to you, while explaining other topics such as eligibility, age requirements, how you can receive benefits, and more. 

What Is the Federal Employees Retirement System (FERS)?

In 1986, the U.S. Congress created the Federal Employees Retirement System which started effectively on January 1, 1987. Since then, it has provided a wide range of services to new civilian employees, such as retirement coverage. FERS can provide a retirement plan using three different sources, known as the Basic Benefit Plan, Social Security, and the Thrift Savings Plan (TSP). 

Two of these three parts — Social Security and the TSP — will transfer to your next job should you leave your job in the Federal Government before retiring. Moreover, both the Basic Benefit and Social Security options require payment from you for every pay period. But don’t worry; your agency will also pay a part of it, where you can receive annuity payments every month for the remainder of your life once you retire. 

Basic Benefit Plan

The first option available in FERS is the Basic Benefit plan; employees receive a set amount regardless of how they contribute. This amount will depend on your “high-3” average and the length of service you have given. High-3 is a term used to refer to the three highest consecutive years of your service; most times, this will be the last three years you have worked. 

Remember that the calculation for this plan only takes your basic salary into account, which means that your bonuses, overtime, and other payments aren’t included. The years of your service will be reported on the SF-50 form, which you receive at least once a year. Your agency will then add a 1% multiplier to your high-3, but employees who are over 62 years old with a minimum of 20 years of service will be able to get a multiplier of 1.1%.

Social Security

Employees who are covered by FERS will need to pay for their Social Security fund at the same rate as a private employee, unlike in plans under public pensions. Anyone under Social Security will need to pay 6.2% of their earnings, and the agency matches that contribution. If you earn $50,000 a year, were born in 1975, and are looking to retire by age 65, you will have an estimated payment of around $1,500 per month. 

Thrift Savings Plan

The Thrift Savings Plan (TSP) works much like a 401(k) and offers the same kinds of savings and tax benefits. During each pay period, your agency will deposit 1% of your basic salary into the TSP; you also have the option to make additional payments that your agency will need to match, which caps at 5%. If you were paid $40,000 with an agency contribution of 5% and a 6% rate of return, you would earn $335,000 after 30 years of service, or $1,400 every year for 20 years. 

What Are the Requirements for FERS?

There are a few federal occupations that have a mandatory retirement age. For example, nuclear weapon couriers (NWCs), law enforcement officers (LEOs), and firefighters have to retire at 57 years of age. Moreover, air traffic controllers (ATCs) will need to retire at 56 years of age, and as a result, they have a different set of eligibility requirements. 

Depending on the kind of work you have, you can have a full FERS annuity by the age of 50 as long as you have 25 years of service, or at 55 years old with 20 years of service. If you’re a FERS employee and want to retire under these conditions, you will also be able to use a multiplier for your retirement calculation, which is 1.7% for the first 20 years, then 1% for every year after. However, you will need to provide a further 0.5% contribution to your FERS paycheck compared to other FERS employees.

Minimum Retirement Age

The minimum retirement age (MRA) for FERS employees is 55. If you were born around 1947 and earlier, this would be your MRA; the oldest members of this group turned 62 back in 2009. However, if you were born between the years 1948 and 1952, check this chart: 

Birth YearMRAYears They Turned 62
194855 years, 2 months2010/2011
194955 years, 4 months2011/2012
195055 years, 6 months2012/2013
195155 years, 8 months2013/2014
195255 years, 10 months2014/2015

But if you were born between the years 1953 and 1964, you will have an MRA of 56 years old; the oldest members of the group will have reached their MRA in 2020. If you were born between 1965 and 1969, check this chart:

Birth YearMRAYears They Reach MRA
196556 years, 2 months2021/2022
196656 years, 4 months2022/2023
196756 years, 6 months2023/2024
196856 years, 8 months2024/2025
196956 years, 10 months2025/2026

Those who were born during the 1970s or later will have an MRA of 57 years old.

Who is Eligible for FERS?

As mentioned, your eligibility will be determined by the number of years for creditable service and your age. The FERS Basic Benefit plan offers four categories of benefits, which are divided into Early, Immediate, Deferred, and Disability. 

Early Retirement 

While it’s possible to get an unreduced annuity immediately before you even reach your MRA, it will be because your place of employment is trying to reduce positions or restructuring. Getting an early retirement will only be offered under special circumstances, and the U.S. Office of Personnel Management (OPM) will only allow agencies to offer such retirements under the Voluntary Early Retirement Authority (VERA). To be eligible to retire under VERA, you will have to qualify in one of two ways: 

  • Be of any age with 25 years of service 
  • Be at least 50 years old with 20 years of service

Immediate and Unreduced

A FERS employee will be eligible for a full and immediate annuity at the age of 62 years old with a minimum of 5 years in service. Those who have provided 5 or more years of service and are 62 years and older are eligible to claim their full pension after leaving federal service. If you have reached your MRA with a minimum of 30 years of service, or have provided 20 years of service and are 60 years old, you can also receive an immediate FERS pension in full. 

Immediate and Reduced

If you want to receive an immediate pension, you will need to provide at least 10 but less than 20 years of service and have a minimum age of 60 years. However, in this scenario, you will have a deduction in your pension; the FERS annuity amount is reduced by 5% for every year that you are under 62 years of age. This starts from whatever the age you are when you first make an immediate claim for your retirement benefits. 

Deferred Retirement

A federal employee under FERS deferred retirement may leave their federal service position whenever they want, and claim an unreduced retirement benefit, provided that they have 5 years of service or more. However, they will also have to wait until they turn 62 years old to get their retirement income. Moreover, an employee may leave service if they have provided at least 30 years of service, where they can defer their entire FERS pension until they reach their MRA. 

Disability Retirement

As long as you have provided at least 18 months of service, you may be able to receive your FERS disability retirement at any age. Keep in mind that claiming benefits for disability retirement will require you to provide your agency with complete details regarding your disabling condition. Once your agency has tried all the possible means of keeping you productive at work, then you may be able to claim your disability retirement benefits.

How Do I Apply for FERS?

To get started on your FERS application, fill out and submit your retirement application, Standard Form 3107. If you’ve moved away from federal services for over 30 days, then submit your application to the OPM:

U.S. Office of Personnel Management
Retirement Operations Center
Post Office Box 45
Boyers, PA 16017


Federal employees may receive benefits in the form of three various plans available from FERS, making it a great option in a world where corporations offer fewer pensions. Luckily, FERS is still one of the best retirement packages around and is easy to apply for, so be sure to consider FERS to see how this federal plan can help you enjoy a secure and comfortable retirement. 

Need help? Let us connect you with a licensed federal retirement agent.

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