Q. I am a FERS employee and plan on retiring March 31, 2014. Can you provide any guidance on whether this would be a good date to retire, or do you advise earlier in the year?
A. The last pay period in March 2014 ends on Saturday the 22nd. By staying on until Monday, March 31, you’d be on the annuity roll in April. You’d also earn seven additional days of pay. However, because you wouldn’t have completed a pay period, you wouldn’t earn any additional annual or sick leave.
The main reasons that employees retire at the end of the year are:
1. To receive a lump-sum payment for any unused annual leave that exceeds the annual carryover limit and would otherwise be lost, and
2. To have that leave paid out at a higher hourly rate when an annual pay increase has been granted.
If you don’t have excess annual leave, that isn’t a concern for you. And since the 2014 pay increase will already be in effect when you retire, it will be valued at your current hourly rate of basic pay.
If you retired earlier than the end of March, you’d have earned less salary, accrued less annual and sick leave, and have fewer months used in the computation of your annuity. However, that could be an argument in favor of staying on job longer than March. In the end, you need to balance nickel-and-dime finances and set a retirement date that feels best to you.