Expert's View

As the Klingons in Star Trek are fond of saying, "This is a good day to die." I’m here to tell you that this year and next year are good years to retire, at least when it comes to the calendar. In 2010, the leave year ends on Saturday, January 1, 2011, and the new leave year begins on Sunday, January 2. In 2011, the leave year ends on December 31, with the new leave year beginning on January 1, 2012. So what makes those years good ones in which to retire?

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Regardless of whether you are covered by CSRS or FERS, in 2010 you can retire at the close of business on Friday, December 31, be on the annuity roll in January, and be entitled to a full month’s annuity. Also, unless you are a Postal Service employee, you will receive a lump sum payment for all your accrued and unused annual leave to boot. (Postal Service employees have a cap on the maximum amount of annual leave they can cash in.)

Heads up! Don’t let anybody at your agency tell you that just because the last pay period ends on Saturday, January 1, you can’t retire at the close of business on Friday, December 31, and get credit for any annual and sick leave you accrued during that last pay period. According to OPM, when you have completed all your hours of work for that pay period, you are free to retire and get full credit. The fact that the pay period officially ends on Saturday is only relevant if you are one of the few employees whose pay period ends on a Saturday.

Retiring in 2011 is even more attractive if you don’t want to wrestle with personnel people who think you can’t retire at close-of-business on a Friday. You can set your effective date on Saturday December 31, 2011, and reap all the benefits mentioned above.

A closing reminder for those who don’t plan to retire this year or next. FERS employees have to retire no later than the end on a month to be on the annuity roll in the following month. CSRS employees can retire up to the third day of a month and still be on the annuity roll in that month. The only thing they sacrifice for leaving after the end of a month is a proportionate reduction in that month’s annuity for each day they delay, up to the third day.