Reg Jones Expert's View

A retirement annuity from the federal government is one of the most significant benefits any person can accrue and later enjoy. As a percentage of your highest three consecutive years of average salary, it can be pretty impressive. This is especially true for those employees covered by CSRS. As a CSRS employee, all you have to have to have is 30 years of service and be at least 55 years old to receive an annuity that is 56.25 percent of your high-3. And each additional year of service is worth 2 percent more.

Let’s look at a pair of examples to see how the percentages add up. If you were a CSRS employee who had 30 years of service at age 55 and worked to age 62, which is what most private sector employees do, you’d have 37 years of service and be entitled to 70.25 of your high-3. The more years you work the more your get, until you hit a cap of 80 percent at 41 years and 11 months. However, you can exceed the 80 percent figure if you have unused sick leave sick leave to add on (something only CSRS-covered employees can do).

If you were a FERS employee with the same amount of service, at age 62 you would receive an annuity equal to 40.7 percent of your high-3. If you retired before age 62 with the same years of service, your annuity percentage would only be 37 percent. That’s because those retiring earlier than age 62 have their high-3 multiplied by 1 percent, whereas those retire at age 62 or older have theirs multiplied by 1.1 percent. A little bonus for sticking around.

Good as those numbers seem, the federal retirement system is an even better deal than you may have realized. For one thing, your annuity isn’t based on the amount of money you and your agency contributed to the retirement system. If that were the case, your account would be empty a few years after you retired. Second, your annuity is increased by annual cost-of-living-adjustments, a benefit that’s almost unheard of in the private sector.

For a quick comparison of how much money you’d have to have to bankroll the annuity you either are drawing or expect to receive, all you have to do is go to and plug some numbers into their annuity calculator. As you’ll see, it doesn’t take a lot – it takes a heck of a lot!