Special retirement supplement 2017

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In April, the Republican budget proposal included a provision that would eliminate the special retirement supplement. The SRS bridges the day you retire and age 62, when you’ll first be eligible for a Social Security benefit.

The SRS is based on your years of actual FERS service. It doesn’t include any other Social Security-covered employment, such as work in the private sector or active duty service in the armed forces, even if you made a deposit to the retirement system to get credit for that time.

To be eligible for the SRS, you must be under age 62, eligible for an immediate annuity, and retire at your minimum retirement age with at least 30 years of service; at age 60 with at least 20 years of service; under one of the special provisions for law enforcement officers, firefighters, air traffic controllers, or military reserve technicians; or at your MRA under one of the early retirement or buyout provisions. If you meet the eligibility criteria for the SRS, it is automatically added to your FERS annuity.

Those who aren’t eligible for the SRS include disability retirees; anyone retiring under the MRA+10 provision; anyone who is only eligible for a deferred annuity; or anyone retiring at age 62 or later.

To estimate what your SRS would be take your estimated Social Security benefit at age 62, divide it by 40, and multiply the product by the years you’ve been a FERS employee, rounded to the nearest whole number. Because this is only an estimate, you may get more or less than that amount. The closer you are to retirement the more dependable the SRS estimate will be.

The SRS won’t change from what you get when you first begin receiving it until your SRS ends at age 62, when you’ll first be eligible for a cost-of-living adjustments.

As a rule, if you have earnings from wages or self-employment that exceed the Social Security $16,920 earnings limit, your SRS will be reduced by $1 for every $2 you earn above that amount or stopped until your earnings fall below the limit.

The earnings limit doesn’t apply to special category employees. If one, you’ll receive the SRS regardless of your age. Further, you can earn as much as you like until you reach your MRA; however, once you reach your MRA, you’ll be treated the same as any other FERS retiree.

The SRS is an indispensible ingredient in a FERS employee’s retirement package. Don’t let them take it away from you.

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About Author

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

7 Comments

    • Anyone wanting to keep Congress from breaking its promise should lobby their own members by phone, letter and personal contact.

  1. Do you have a link to the text of the Republican proposal to eliminate SRS? Are they just stopping it even for retirees in receipt of it? Any grandfather clauses for folks like me (28+ years service/48 years old)? If I knew they’d eliminate it I would have saved much more TSP years ago to make up for it. Thanks

    • Yes, if I were to retire at my MRA in 2026, my SRS would amount to roughly 25.5% of my high 3 salary based on age 62 SS estimates. Add that to 37% of my high 3 salary for my roughly 37 years service when I hit my MRA and I would be receiving roughly 62.5% of my high 3 salary when you combine my FERS + SRS. Take away my SRS I might as well wait till age 62 before retiring as I likely won’t have that much extra saved in my TSP to make up for lost SRS…….Add 20% of my high 3 coming out of my TSP would give me roughly 82.5% of my high 3 at MRA retirement – in effect equaling my net take home pay from working…….In retirement I won’t be paying 10% into TSP, the current .8% into FERS, 6.2% to Social Security or 1.45% to Medicare.

  2. Is your figure of $ 23,625 for the annual social security earnings limit a typo? Everywhere I search it says the limit before full retirement age is $16,920

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