Q. I have been offered an opportunity in FERS. I retired from the Navy Reserve in 2009 with 25 years of creditable service. I will not be drawing this pension until age 58 (credit for post-9/11 active-duty lowers from 60). How would making a deposit for military service work? Like active-duty retirees, would I then waive my reserve retirement? Would the decision simply be a calculation to see which retirement would yield the biggest pension? I retired as an O-5 and would be entering FERS at grade 13. I am 49 years old and would work until at least 62.
A. You would only be able to make a deposit for your years of active-duty service. If you completed five years of actual FERS service, you’d be vested in the system and could retire on an immediate, unreduced annuity with one of the following combinations of years and service: age 65 with five, 60 with 20, or at your minimum retirement age with 30. MRAs range between 55 and 57 depending on your year of birth. Your MRA would be 56. In addition, you could retire under the MRA+10 provision; however, your annuity would be reduced by 5 percent for every year you were under age 62. Regardless of which way you go, you would be able to receive both your civilian annuity and your reserve retired pay.
To figure out what your FERS annuity would be, use this formula: .01 x your highest three consecutive years of average pay x your years and full months of service (actual and active duty service for which you’ve made a deposit). If you retired at age 62 with at least 20 years of combined service, the multiplier would be increased to .011.
