Reg Jones Expert's View

I keep thinking that every federal employee knows the combination of age and years of service they need to retire. But time after time I get e-mails proving that I’m wrong.

For that reason, I’m going to do my best to explain the rules so that we can all work off the same page, the one anchored in law. This week I’ll focus on the Civil Service Retirement System.


Immediate annuity – CSRS

The rules governing CSRS employees are easy. If you are a CSRS employee, 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 opportunities under the Voluntary Early Retirement Authority (VERA), you can retire with the following combinations of age and service:

• 50 with 20

• at any age with 25

If you retire before age 55, your annuity will be reduced by 2 percent for every year (1/6 of 1 percent per month) that you are under age 55. That applies to relatively few CSRS retirees these days.

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

Immediate annuity – CSRS Offset

With one exception, the rules governing CSRS Offset employees are the same as those for regular CSRS employees. Here’s the exception. At age 62 your CSRS annuity (or at retirement, if later) will be reduced by the amount of Social Security benefit you earned while a CSRS Offset employee.

That reduction will occur whether or not you apply for a Social Security benefit, so be sure to apply for Social Security at 62 or at retirement, if later.

Deferred annuity

If you don’t meet the age and service requirements to retire when you leave but have at least 5 years of service and don’t ask for a refund of your retirement contributions, you can apply for a deferred annuity when you meet one of the following age and service combinations:

• 62 with 5

• 60 with 20

• 55 with 30

If you are a former CSRS Offset employee, the reduction in your CSRS annuity at age 62 will be the same as that described above under Immediate annuity – CSRS.

Health benefits and life insurance

If you retire on an immediate unreduced annuity, you can carry your FEHB and FEGLI coverage into retirement, so long as you were in the program for the prior five years (or from the first opportunity to enroll, a rare situation applying mostly to those who returned from a break in service within five years of retiring).

If you leave before being eligible for an annuity, your coverage will end after a 31-day free extension of coverage. At that point you can continue your health benefits coverage at you own expense, plus 2 percent for up to 18 months. And you’ll have the option of purchasing individual life insurance at your own expense. When you do apply for a deferred annuity, you won’t be able to reenroll in either the FEHB or FEGLI programs.

Next week I’ll go over the retirement rules governing the Federal Employees Retirement System.