Picking a retirement date


Q. Everything I’ve read states it’s best for FERS employees to retire on the last day of the month to be on the retirement payroll the next month. I plan on retiring in October 2013 at age 60 with 30 years (includes three years of military service already bought back). Oct. 31, 2013, is a Thursday with the pay period ending Saturday, Nov. 2. My birthday is Oct. 24, so I can’t go sooner than the end of the month. Even though I will get credit for approximately 45 days of sick leave after the 1/2 deduction, I have been told that will be credited after retirement, not before. So if I retire Oct. 31, will leave for that pay period be prorated, or would I lose all leave earned for that pay period? Are there any other problems retiring before the end of a pay period? If I wait until Nov. 2, I assume that means I won’t be on the retirement payroll until Dec. 1?  I just can’t see holding off until the end of November 2013 when the last day is the end of a pay period. Thanks.

A. You are correct. As a FERS employee, if you retired on Oct. 31, you’d be on the annuity roll Nov. 1. If you left Nov. 2, you wouldn’t be on the annuity roll until Dec. 1. Further, half of any unused sick leave you have would be used in your annuity computation, not in determining the number of days you were on the payroll. Finally, if you retire before the end of a pay period, you wouldn’t get any credit for the annual or sick leave you would have earned if you had stayed until the end of the pay period. The decision about when to retire is yours to make. While running the numbers to see which retirement date is financially best, don’t tie yourself into a knot trying to squeeze out a few more bucks. Pick the date with which you are most comfortable.


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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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