Q. I am looking at retiring in September 2014 at age 57 years and five months. I will have 34 years in FERS and a little less than a year of sick leave to convert. I have $359,000 in my Thrift Savings Plan account. I am single, never married. What are my best options? I am located in an isolated area and am unable to attend any retirement seminars, especially now with the budget issues.
A. Here’s a short retirement course for you. Your annuity will be computed using the standard formula: .01 x your high-3 x all years and full months of service (including unused sick leave). You’ll be entitled to the special retirement supplement, which approximates the amount of Social Security benefit you earned while a FERS employee. Your annuity won’t be increased by cost-of-living adjustments until age 62. Your SRS won’t be increased at all. It stops at age 62 when you’ll be eligible for a Social Security benefit based on your entire work history, not just the period when you were a FERS employee. Note: If you have earnings from wages or self-employment after you retire that exceed the annual Social Security earnings limit, your SRS or your Social Security benefit would be reduced. That limit in 2013 is $15,120. The earning limit no longer applies when you reach your full Social Security retirement age.
If you were enrolled in the Federal Employees Health Benefits and/or the Federal Employees’ Group Life Insurance programs for the five consecutive years before you retire, you’ll be able to carry that coverage into retirement. Your FEHB premiums will be the same as they were while an employee. Premiums for FEGLI Basic will continue until age 65, when they will stop if you elect the 75 percent reduction. They will rise if you elect either the 50 percent or no reduction. If you elected any of the optional coverages, you’ll need to check to see how they would be handled after you retire.