Reg Jones Expert's View

More than any other federal employees, those who are covered by CSRS are the most likely to be eligible to retire now, and may have been eligible to retire for a long time. With all the changes that have been taking place in government and may be on the horizon, I want to focus on the rules governing your eligibility to retire.

Immediate annuity – CSRS
You can retire on an immediate unreduced annuity with the following combinations of age and service:

• 62 with 5
• 60 with 20
• 55 with 30

If your agency is offering early retirement through the Voluntary Early Retirement Authority (VERA), you can retire with either of the following combinations of age and service:

• 50 with 20
• any age with 25

Note: If you retire before age 55, your annuity will be reduced by 2 percent for every year (1/6 of 1 percent per month) you are under age 55; that doesn’t apply to a lot of CSRS people anymore but it’s still in the law.

Regardless of your age, you’ll be entitled to receive any cost-of-living adjustments (COLAs) that are added to CSRS retiree annuities.

Immediate annuity – CSRS Offset
While the age and service combinations need to retire are the same for CSRS and CSRS Offset employees, there is one difference in how you annuity will be paid. At age 62 (or at retirement, if later) your CSRS annuity will be reduced by the amount of Social Security benefit you earned while a CSRS Offset employee. That reduction will be made even if you don’t apply for a Social Security benefit, so you’ll want to apply for Social Security at 62 (or at retirement, if later).

Deferred annuity
If you aren’t eligible to retire on an immediate annuity but don’t want to stick around until you are, you can always leave government and apply for a deferred annuity. To be eligible you need at least 5 years of service, not ask for a refund of your retirement contributions, and meet one of the following age and service combinations:

• 62 with 5
• 60 with 20
• 55 with 30

Note: If you were a CSRS Offset employee, the reduction in your CSRS annuity to offset Social Security benefits will be the same as that mentioned under Immediate annuity – CSRS Offset.

Health benefits and life insurance
If you retire on an immediate unreduced annuity, you can carry your FEHB and FEGLI coverage into retirement. However, if you leave before being eligible for an immediate annuity, your coverage will end after a 31-day free extension of coverage. At that point you’ll have the option of continuing your health benefits coverage at you own expense, plus 2 percent, for up to 18 months. You’ll also have the option of purchasing individual life insurance at your own expense.

Note: When you do apply for your deferred annuity, you won’t be able to reenroll in either the FEHB or FEGLI programs.