FERS Retirees Are Eligible to Collect Social
Security
and a Supplement if They Retire Early
FERS employees who retire After their Minimum
Retirement Age (MRA) with 30 years of service will receive a Special
Retirement Supplement which is paid as an annuity until you reach age 62 and
become eligible for Social Security.
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- Monthly benefits if you are retired and have reached at least age 62,
and monthly benefits during your retirement for your spouse and dependents
if they are eligible;
- Monthly benefits if you become totally disabled for gainful employment
and benefits for your spouse and dependents if they are eligible during your
disability;
- Monthly benefits for your eligible survivors; and
- A lump sum benefit upon your death.
To become eligible for benefits, you and your family must meet different sets
of requirements for each type of benefit. An underlying condition of payment of
most benefits is that you have paid Social Security taxes for the required
period of time.
The amount of monthly benefits you receive is based on three
fundamental factors:
- Average earnings upon which you have paid Social Security taxes, which
are adjusted over the years for changes in average earnings of the American
work force;
- Family composition (for example, whether you have a spouse or dependent
child who may be eligible for benefits); and
- Consumer Price Index (CPI) changes that occur after you become entitled
to benefits.
Benefits are subject to individual and family maximums.
If you meet certain requirements, you will receive a Special Retirement
Supplement which is paid as an annuity until you reach age 62. This supplement
is somewhat similar to the Social Security benefit earned while you were employed by the
Federal government. However, since the formula for the Special Supplement
assumes a working life of 40 years, each year of FERS service is worth
one-fortieth of the estimated Social Security benefit. Therefore, the FERS
Supplement is often significantly less than your Social Security benefits. The
supplement ends at age 62 even if you elect to wait to apply for Social Security
benefits.
You may be eligible for a Special Retirement Supplement if
you retire:
- After the
Minimum Retirement Age (MRA) with 30 years of service;
- At age 60 with 20 years of service; or
- Upon involuntary or early voluntary retirement (age 50 with 20 years of
service, or at any age with 25 years of service) after the U.S. Office of
Personnel Management determines that your agency is undergoing a major
reorganization, reduction-in-force (RIF) or transfer of function. You will
not receive the Special Retirement Supplement until you reach your MRA.
If you transfer to the Federal Employees Retirement System (FERS) from the
Civil Service Retirement System (CSRS), you must have at least one full calendar
year of FERS-covered service to qualify for the supplement.
If you have earnings from wages or self-employment that exceed the Social
Security annual exempt amount ($9,120 in 1998), your Special Retirement
Supplement will be reduced or stopped.
If you have active military time, and are eligible to collect Social Security
at age 62,
your annuity will decrease unless you buy back
your military time.
FERS Supplement
Impact on Earnings
If you retire with a FERS supplement and go back to work in retirement your
supplement is subject to the same Social Security earnings rules. Basically,
if you are receiving a supplement and earn more than $14,160 a year in
2010 you would have to give back $1 for every $2 you earn over this limit.
CSRS employees that worked 40 quarters or more in the private sector and
collect Social Security at age 62 are also subject to these same income
limitations until they reach full retirement age, currently age 66.
To estimate your Social Security Supplement use the
Free CSRS and FERS
Retirement Software available from Decision Support Software. The software includes an easy-to-use supplement
calculator and integrates the supplement into your overall federal retirement
analysis.
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