Q: I am trying to figure out how Federal Employees Retirement System contributions deducted from my pay work. Are they included in retirement pay? I know about the high-3, the 1 percent or the 1.1 percent, and the total years of service and months used for computing retirement annuity. I just don’t understand the FERS subtraction and how it fits, or if it does, into the retirement annuity equation process.
A: The retirement contributions that are deducted from your pay have no direct bearing on what you will receive in your annuity. It will be based on a formula that includes your highest three consecutive years of average salary and your years and full months of creditable service, not on the amount you contributed to the retirement fund.