Complete FERS Retirement Guide
Everything you need to know about the Federal Employees Retirement System: eligibility, pension calculation, survivor benefits, and planning strategies.
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What is FERS?
The Federal Employees Retirement System (FERS) is the retirement plan for federal civilian employees hired after December 31, 1983. It replaced the older Civil Service Retirement System (CSRS).
FERS is a "three-legged stool" consisting of three components:
FERS Pension
Defined benefit based on years of service and High-3 salary
Social Security
FERS employees pay into and receive Social Security benefits
TSP
401(k)-style savings with agency matching up to 5%
Unlike CSRS (which provides a larger pension but no Social Security), FERS provides a more balanced approach to retirement income with contributions to Social Security and the Thrift Savings Plan.
FERS Retirement Eligibility
To receive an immediate FERS pension, you must meet one of these age and service combinations:
| Retirement Type | Age | Service | Reduction | Supplement? |
|---|---|---|---|---|
| Immediate Unreduced | 62 | 5 years | None | No |
| Immediate Unreduced | 60 | 20 years | None | No |
| Immediate Unreduced | MRA | 30 years | None | Yes |
| MRA+10 (Reduced) | MRA | 10-29 years | 5%/year under 62 | No |
| Deferred | 62 | 5 years | None (delayed start) | No |
| Early Out (VERA) | 50 | 20 years | None* | Yes* |
* VERA (Voluntary Early Retirement Authority) is only available during agency-offered early out windows.
Minimum Retirement Age (MRA) by Birth Year
Your MRA depends on when you were born. Use this chart to find your minimum retirement age:
| Year of Birth | Minimum Retirement Age |
|---|---|
| 1948-1952 | 55 years |
| 1953 | 55 years, 2 months |
| 1954 | 55 years, 4 months |
| 1955 | 55 years, 6 months |
| 1956 | 55 years, 8 months |
| 1957 | 55 years, 10 months |
| 1958 | 56 years |
| 1959 | 56 years, 2 months |
| 1960 | 56 years, 4 months |
| 1961 | 56 years, 6 months |
| 1962 | 56 years, 8 months |
| 1963 | 56 years, 10 months |
| 1964-1969 | 57 years |
| 1970 and later | 57 years |
The FERS Pension Formula
The FERS pension is calculated using a simple formula:
FERS Pension Formula
Annual Pension = High-3 Salary × Years of Service × MultiplierExample Calculations
Standard Retirement (1% multiplier)
- High-3: $95,000
- Years: 25
- Multiplier: 1%
- Pension: $23,750/year ($1,979/mo)
Age 62+ with 20 years (1.1% multiplier)
- High-3: $95,000
- Years: 25
- Multiplier: 1.1%
- Pension: $26,125/year ($2,177/mo)
The 1.1% multiplier is a 10% boost to your pension, worth an extra $2,375/year in the example above. If you're close to age 62 with 20+ years, consider whether waiting makes financial sense.
Understanding Your High-3 Salary
Your High-3 is the average of your highest 36 consecutive months of basic pay. This is a critical number because it directly multiplies into your pension.
What Counts as Basic Pay
Included in High-3
- ✓ Base salary (GS, WG, etc.)
- ✓ Locality pay
- ✓ Special rate supplements
- ✓ Shift differentials (if regular)
- ✓ Law enforcement availability pay
NOT Included in High-3
- ✗ Overtime pay
- ✗ Bonuses (recruitment, relocation, retention)
- ✗ Awards
- ✗ Lump-sum leave payments
- ✗ Hazard pay
For most employees, the High-3 period is their final 3 years before retirement. However, if you had a higher-paying position earlier in your career (e.g., moved from a high-locality area to a lower one), your High-3 might come from that earlier period.
1% vs 1.1% Multiplier
Most FERS employees receive a 1% multiplier for each year of service. However, you get the enhanced 1.1% multiplier if you meet BOTH conditions:
- You are age 62 or older at retirement, AND
- You have 20 or more years of creditable service
Should You Wait for 1.1%?
The 1.1% multiplier is worth 10% more pension for life. If you're 61 with 25 years of service, waiting one year could add $2,500+ annually to your pension forever. But factor in the year of pension you'd give up by waiting. The breakeven is typically 10-12 years.
Early Retirement Options & Penalties
MRA+10 Retirement
If you retire at your MRA with 10-29 years of service, you receive a reduced pension. The reduction is 5% for each year (5/12% per month) you are under age 62.
MRA+10 Penalty Examples
| Retirement Age | Years Under 62 | Reduction |
|---|---|---|
| 57 | 5 years | 25% |
| 58 | 4 years | 20% |
| 59 | 3 years | 15% |
| 60 | 2 years | 10% |
| 61 | 1 year | 5% |
Postponed Retirement
You can avoid the MRA+10 penalty by postponing your pension start date until age 62. You leave federal service at MRA+10 but don't start receiving your pension until you turn 62. This eliminates the reduction but means years without pension income.
Deferred Retirement
If you leave federal service with 5+ years but before retirement eligibility, you can receive adeferred pension starting at age 62. You don't receive any pension until then.
FERS Survivor Benefits
When you retire, you can elect to provide a survivor benefit to your spouse. This ensures they receive a portion of your pension after your death, but it reduces your pension while you're alive.
Full Survivor (50%)
10%
reduction to your pension
Spouse receives 50% of your pension for life
Partial Survivor (25%)
5%
reduction to your pension
Spouse receives 25% of your pension for life
No Survivor Benefit
0%
reduction to your pension
Requires spouse's written consent
Important: If you have a spouse at retirement and elect less than full survivor benefit, your spouse must provide written consent. The survivor benefit election is generally permanent.
The FERS Supplement
The FERS Supplement is a temporary benefit that bridges the gap between your retirement date and age 62 (when you become eligible for Social Security). It's designed to approximate what your Social Security benefit would be based on your FERS-covered service.
Who Gets the Supplement?
- Employees who retire at MRA with 30 years of service
- Special category employees (LEO, firefighters, air traffic controllers) who retire under special provisions
- Employees who retire under VERA (Voluntary Early Retirement Authority)
NOT eligible: MRA+10 retirees, deferred retirees, or those who retire at 60 with 20 years.
Earnings Test
The supplement is subject to an earnings test similar to Social Security. If you earn more than the annual exempt amount ($22,320 in 2024) from wages or self-employment, your supplement is reduced by $1 for every $2 you earn over the limit.
Sick Leave Credit
Unused sick leave at retirement is converted to additional service credit for your pension calculation. This is essentially "free" pension credit for leave you never used.
Sick Leave Conversion
2,087 hours of sick leave = 1 year of service creditExample: 1,000 hours of sick leave = approximately 5.75 months of additional service credit
Important: Sick leave credit counts toward your pension calculation but NOT toward eligibility requirements. You still need actual years of service to meet the 5, 10, 20, or 30 year requirements.
The FERS Three-Legged Stool
FERS retirement income comes from three sources. For a comfortable retirement, you need to understand and optimize all three:
1. FERS Pension
Defined benefit based on High-3 and years of service. Provides stable, guaranteed income for life. COLA-adjusted annually.
Calculate your pension →2. Social Security
Based on your 35 highest-earning years. FERS employees pay into and receive Social Security, unlike CSRS employees.
Check your SSA estimate →3. TSP Savings
Your 401(k)-style savings with agency matching. The 5% match is free money. Project your growth and withdrawal strategy.
Project your TSP →Frequently Asked Questions
How is my FERS pension calculated?↓
FERS pension = High-3 Average Salary × Years of Service × Multiplier. The multiplier is 1% for most retirees, or 1.1% if you retire at age 62+ with 20+ years of service. Example: $100,000 High-3 × 30 years × 1% = $30,000/year pension.
What is the FERS Minimum Retirement Age (MRA)?↓
MRA depends on birth year: 1948-1952 = 55 years, 1953-1964 = 55-56 (increases by 2 months per year), 1970+ = 57 years. You can retire at MRA with 30 years for full benefits, or MRA with 10 years for reduced benefits.
What is the High-3 salary?↓
High-3 is the average of your highest 36 consecutive months of basic pay. For most employees, this is their final 3 years. It includes locality pay but excludes overtime, bonuses, and awards.
Can I retire early under FERS?↓
Yes, but with penalties. MRA+10 retirement: You can retire at MRA with 10-29 years of service, but pension is reduced 5% per year you're under age 62. Example: Retiring at 57 (5 years before 62) = 25% reduction.
What is the FERS Supplement?↓
The FERS Supplement is a temporary benefit that approximates your Social Security benefit, paid from retirement until age 62. Only available if you retire with 30 years at MRA, or under special provisions (LEO, firefighter). It's subject to an earnings test.
Does unused sick leave count toward my pension?↓
Yes! Unused sick leave converts to additional service credit. 2,087 hours = 1 year of credit. The conversion doesn't count toward eligibility (the 5, 10, 20, 30 year requirements), but it increases your pension calculation.
How much does FERS survivor benefit cost?↓
Full survivor benefit (50% to spouse) costs 10% of your gross pension. Partial benefit (25%) costs 5%. The spouse receives these benefits for life after your death. You can also elect no survivor benefit with spouse consent.
When should I retire to get the 1.1% multiplier?↓
To get the 1.1% multiplier (instead of 1%), you must be age 62 or older AND have 20+ years of service. This is a 10% boost to your pension. If you're close to 62 with 20 years, it may be worth waiting.