The monthly pension is a benefit that federal government employees receive after they retire from service. Workers typically retire from their jobs by the time they reach 65, as this is the standard across various fields. However, the minimum retirement age for federal government employees is a different case.
The Federal Employees Retirement System (FERS) follows a special system where the minimum retirement age is calculated based on the year they were born.
There are also certain conditions that may affect the benefits you are entitled to and the pension you receive upon retirement. Learn more about your FERS retirement age, special conditions, and more by reading the full article.
Identifying Your Minimum FERS Retirement Age
Retirement trends for government employees are different compared to other professions. Many people recognize 65 as the most common age for retirement. With employees under the FERS, the average age of voluntary retirement is 63. However, employees can retire before reaching 63 as long as they have reached their FERS retirement age or have met the criteria to qualify for retirement.
As mentioned above, the FERS retirement age depends on what year an employee was born. According to the U.S. Office of Personnel Management (OPM), a worker can have a minimum retirement age that is as low as 55 years old. This applies to those that were born before 1948. The highest possible minimum age for retirement is 57, assigned for workers born after 1970.
The full list of possible MRA age qualifications varies per year, adding a minimum of 2 months to the MRA for every following year. See the brief guide below for reference.
- Before 1948 – 55 years
- 1948 – 55 years and 2 months
- 1949 – 55 years and 4 months
- 1950 – 55 years and 6 months
- 1951 – 55 years and 8 months
- 1952 – 55 years and 10 months
- 1953 – 1964 – 56 years
The full list can be viewed on OPM’s FERS retirement services webpage.
Qualifying for Full Benefits
Although FERS has assigned a minimum age of retirement for workers, that doesn’t mean that employees will be able to receive their full retirement benefits upon reaching their FERS retirement age. To enjoy the full benefits, every employee must meet at least one of the given criteria:
- The employee must reach their FERS retirement age and have 30 years of service
- The employee has reached 60 and has a minimum of 20 years of service
- The employee has reached 62 and has a minimum of 5 years of service
Immediate Retirement
Immediate retirement is applicable for employees that have reached 62 years old and have worked under the federal government for at least 5 years. As employees under immediate retirement have met the criteria and surpassed their FERS retirement age, they are entitled to unreduced retirement benefits. This means that they will receive their monthly pension with no deductions and will even receive an additional .1% in calculating their retirement benefits.
Employees that do not meet the criteria or have not opted for immediate retirement will not receive the .1% boost, so their benefits will only be multiplied by 1% instead of 1.1%.
Individuals who have met the other criteria, reaching MRA with 30 years of service or reaching 60 with 20 years of service, are also eligible for unreduced retirement benefits.
Early Retirement
Early retirement is also possible, as long as an employee has reached their MRA and has a minimum of 10 years of service under the federal government. However, employees who retire early will receive a permanent 5% deduction. The deduction will be counted for every year that an employee retires before reaching 62 years old.
Overall, the pension received under early retirement is 10% lower than the amount included in the full retirement benefits. In addition, an employee may not be able to qualify for a cost-of-living adjustment (COLA) if they receive their monthly annuity before reaching 62 years old.
However, receiving full benefits under early retirement is not completely impossible. There is another set of criteria that must be met so that an employee can enjoy unreduced benefits. To avoid deductions, enjoy the full pension amount, and add the .1% multiplier under early retirement, the employee must:
- Reach their FERS retirement age and have a minimum of 30 years of service
- Reach 62 years old with a minimum of 5 years of service
- Reach 60 years old with a minimum of 20 years of service
Deferred Retirement
Although reaching the FERS retirement age or accomplishing the required years of service is the common standard of retirement, federal government employees can retire from service before this. Once an employee has served at least 5 to 30 years under the federal government, then they can retire even without reaching their FERS retirement age.
They can also claim the full, unreduced retirement benefits. However, they must wait until they turn 62 or reach their MRA to do so. Employees that have served for five years can begin receiving their monthly pension at the age of 62, while those with 30 years of service or more can enjoy the full benefits upon reaching their FERS retirement age.
Waiting until they reach their MRA or 62 years old respectively complies with the criteria for receiving the full, unreduced benefits. Since the criteria state a certain age and years of service, situations under deferred retirement are still valid. Employees who opt for deferred retirement may still receive deductions if they retire after 10 years of service but do not reach at least 30 years. This can be considered early retirement, meaning that workers will receive the 5% deduction even if they choose to wait until they receive their monthly pension.
Postponed Retirement
Postponed retirement is similar to deferred retirement. However, it is not completely the same thing. Like those who choose deferred retirement, workers that opt for postponed retirement may leave their position in the federal government once they reach a minimum of 10 years of service.
From there, they will need to wait until they reach their MRA or turn 62 years old before they can begin enjoying their monthly pension and other benefits. The key difference between the two is that those who choose postponed retirement can re-enroll in the Federal Employees Health Benefits (FEHB) upon turning 62.
The individual must be enrolled in the FEHB or must meet the requirements before retiring. Otherwise, the benefits under FEHB may not apply to them. Take note that special benefits like the 1.1% boost to the retirement benefit calculations do not apply to those under postponed retirement, as this is a special privilege that can be enjoyed by immediate retirees only.
Conclusion
Knowing how to calculate your FERS retirement age is the first step to recognizing your benefits and acknowledging your rights as a retiring federal government employee. It is important that employees understand the criteria and requirements that must be accomplished under every type of retirement so that they may find the most suitable plan for their needs.
For more information about FERS and retirement, schedule a call with one of our licensed agents.
