FERS disabililty vs. regular disability


Q.  I am a current federal employee with 1 year and nine months to go before I can retire (20 years at age 50).  I also have bought back 11 years military time.  I was injured on the job in 2006 and have had several recurrences with my fifth disc.  Been on OWCP, back to work, OWCP back to work, etc.  My question is, if I were to elect a FERS disability retirement, would my military time that I bought back still figure into the equation or would you recommend trying to get to the 20 years and do a regular retirement?  (Note: I work in a federal penitentiary so my concern is always my safety and whether or not I can defend myself)

A. You’ll have to do the math to find out which is best. If you retired on disability, for the first 12 months you’d receive 60 percent of your high-3 minus 100 percent of any Social Security benefit to which you might be entitled. (If you apply for FERS disability retirement, you have to apply for a Social Security benefit.) After the first 12 months, you’d get 40 percent of your high-3 minus 60 percent of any Social Security disability benefit. Assuming that you continued to be disabled, at age 62 your disability annuity would be converted to a regular annuity. It would be based on your actual service, your bought back military time, and the years between when your disability annuity began and age 62. The total service figure would be multiplied by 0.01 and the product multiplied by your high-3 on the day you retired on disability, increased by any cost-of-living adjustments that had been made since then.

If you wait until you can take an immediate annuity, as a law enforcement officer, your first 20 years would be multiplied by 0.17 percent, and the product multiplied by your high-3 on the day you retired. When you reached your minimum retirement age, you would also be eligible for the special retirement supplement, which approximates the Social Security benefit you earned while a FERS employee. MRAs range between 55 and 57, depending on your year of birth.  Another advantage of retiring on an immediate annuity is that you won’t have to provide proof each year that you are still disabled.

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Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to fedexperts@federaltimes.com.

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