Can’t Miss Retirement Benefits for Every Federal Employee

The Federal Employees Retirement System, or FERS, is the federal government’s retirement plan for civilian federal employees. FERS began in the 1980s as a replacement for the Civil Servant Retirement System (CSRS).

FERS is made up of three parts: Basic Benefits, Social Security and the Thrift Savings Plan. These three components work together to provide an outstanding retirement benefits package for federal employees.

There are many exceptional retirement benefits offered to federal employees. Here are some benefits that you should know more about.

Thrift Savings Plan (TSP)

The Thrift Savings Plan is an optional retirement savings plan for federal employees. It is managed by the federal government and offers many options to meet your retirement savings goals.

All federal employees should be enrolled in this program, even if they are not worried about retirement. Why? Because the federal government provides matching funds up to 5% of your salary. That means that if you opt to contribute 5% of your salary to the TSP, your contribution will be doubled.

If you contribute 1% the federal government will match 1%. For this reason, contributing anything less than 5% is leaving money on the table.

You will have many options for your investment strategy as well. You can choose between various investment portfolios based on your retirement timeline and the level of investment risk.

You can also now choose either a traditional or Roth retirement account. With a traditional retirement account, your contributions are not taxed now but will be taxed in the future when you make withdrawals. A Roth retirement account, however, taxes those funds now so that you don’t have to worry about paying taxes on them later.

What should you do?

The TSP website offers planning tools to help you with your retirement planning. These tools can help you to invest your TSP savings in investment products that will help you reach your retirement savings goals.

Subsidized Health Insurance

Federal employees may have access to subsidized Federal Employee Health Benefits (FEHB) after retirement if they meet certain criteria.

These criteria include:

  • Enrollment in FEHB at the time of retirement and for at least five years prior
  • You must be of retirement age (or you will need to wait until your annuity begins to get coverage).

Death and Survivor Benefits

FERS may also provide benefits for your dependents after you pass away. These benefits could be in the form of a lump-sum payment or annuity. Eligible dependents include unmarried children under 22 and surviving spouses who have been married to the deceased for at least nine months.

Knowing that your family will continue to receive support after your passing gives you great peace of mind.

Military Service Time Buy-Back

Your time spent in military service does not automatically become part of your federal time in service. For example, you might be hoping to add your 4 years in the Air Force to your 16 years in the federal government to make up your 20 years of service.

You can “buy back” your creditable military service by making payments set by the government. Contact your personnel services unit to talk about how to add your military service time to your federal time in service calculations. 

Retirement Counselors

The federal government supports its employees through retirement planning via federal retirement counselors. Any current or former federal employee can call and speak with a retirement counselor at any time.

Retirement counselors are trained experts in all aspects of retirement from federal service. There are many retirement options: early retirement, phased retirement, disability retirement and more. Your federal retirement counselor can help you to understand all the options available to you and provide you with the tools and information you need.

Retiring from Federal Service

Retiring from federal service is a process that is best started a couple of years before you expect to retire. There are many factors to consider when choosing the best time for you to retire and giving yourself time to explore those options will get you the best possible outcome.

By starting your retirement planning early, you allow yourself time to make necessary adjustments to your savings and investments and provide you with the information that you need to make plans for your family’s future.

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