MRA+10

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Q. I’m a FERS employee and plan to retire at minimum retirement age, which is 56. However, I’ll have fewer than 30 years of service. Is the 5 percent per year penalty based on each year short of 30 years, or is it based on each year short of age 62?

A. The MRA+10 provision allows FERS employees to retire at their minimum retirement age with fewer than 30 years of service. If you retire under that provision, your annuity will be reduced by 5 percent for every year (or 5/12 of 1 percent per month) that you are under age 62.

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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.

13 Comments

    • The 5 percent per year penalty continues to reduce by 5/12ths of 1 percent per month until you reach age 62, unless you have at least 20 years of service. If you do, then the penalty ends at age 60.

      • I believe if you postpone you could avoid the penalty. I’m not sure about eligibility for FEHB in that case, I would check on that.

        • Any FERS employee who retires under the MRA+10 provision and postpones the receipt of his annuity to a later date can reenroll in the FEHB program as long as he was covered by the program for the 5 consecutive years before he retired or from his first opportunity to enroll.

          • No. As I wrote on October 22, “The 5 percent per year penalty continues to reduce by 5/12ths of 1 percent per month until you reach age 62, unless you have at least 20 years of service. If you do, then the penalty ends at age 60.”

        • As I wrote on October 22, “The 5 percent per year penalty continues to reduce by 5/12ths of 1 percent per month until you reach age 62, unless you have at least 20 years of service. If you do, then the penalty ends at age 60.”

          • Reg, I think what some people are confused about is if the penalty, once applied, continues for life or if it gets restored back to the full non-reduced level of the annuity start at age 60 or 62?

          • The penalty, once imposed at the start of retirement, is forever and does not end. One may avoid the penalty by continuing to work, but if he or she retires with a penalty, that penalty is forever — such a retiree does not get a boost (end of the penalty) when he or she reaches 60 or 62. At least, this is how I understand it.

    • Sick leave has no cash value. It can only be used to increase the amount of your annuity if there is enough of it to make a difference. For example, if you have 176 hours of sick leave, it would increase your length of service by 1 month.

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