Q. I qualify for a buyout with 25-plus years of service. If I take the buyout, it is my understanding that I must wait until my normal minimum retirement age of 56 to begin receiving the Social Security supplement. Would this prevent me from receiving increases in Social Security supplemental benefits that I would have received had I waited until 56 to retire? I believe I would get the increases at 62, in any event, when I could first draw reduced SS benefits. Also, what happens to my Thrift Savings Plan account? May I purchase an immediate annuity and/or take a…
Browsing: early withdrawal penalty
Q. I plan to retire Nov. 2, 2013. I will be 66 years old, with 37 years of service. I am CSRS Offset for 30 of those years. I withdrew approximately $9,000 in 1982 (CSRS earnings) and will not be repaying it. (It’s now about $55,000 with a penalty of about $300 per month.) I know my retirement will be “offset” by about $800 in Social Security. My Social Security is estimated to be about $1,460 before the offset. Will I be able to collect the Social Security difference of approximately $600, or is my CSRS offset all that I’ll…
Q. I plan to retire at age 58 with 22 years of service. My human resources department is penalizing me 20 percent, or 5 percent for each year under 62. They are quoting me information from a 1998 Federal Retirement Handbook. The gentlemen who taught the retirement seminar that I attended in June 2011 tell me that I should only be penalized 10 percent. That is 5 percent for each year under 60 with over 20 years of service. I think 10 percent of my future paycheck is too much to forfeit. Who is correct, please? A. Your agency HR…
Q. I’m 57 years old, started with the Postal Service in June 1987, bought back five years and nine months of military time. What would be the difference in benefits between retiring if a VERA is offered and retiring before a VERA is offered? Would I be penalized on my Thrift Savings Plan? Can I get the Social Security supplement? Would I be able to collect Social Security supplement either way? Reg Jones: There wouldn’t be any difference. Since you already have the right combination of age and years of service, you can retire whenever you want to. Voluntary Early…
Q. I am under the FERS retirement plan. In four years, I will be 57 with 30 years. Will I be penalized in any way? Also, will I be able to tap into my Thrift Savings Plan? A. Reg Jones says: Because you will be retiring at your minimum retirement age with at least 30 years of service, you’ll receive a full, unreduced annuity. Mike Miles says: You’ll have access to your TSP account after retire without penalty.
Q. Does the 5 percent annual penalty for retiring under the MRA at age 56 cover the lifetime of distributions, or only until one reaches age 62? A. If you retire under the MRA+10 provision (minimum retirement age with at least 10 but fewer than 30 years of service), your annuity will be permanently reduced by 5 percent (5/12 percent per month) that you are under age 62.
Q. I am 59 and have 14 years of federal service under FERS. I plan to retire around the end of April. I turn 60 on Oct. 10, and am wondering if I should retire on the 10th of the month in order to avoid an extra month being added to the annuity reduction. Also, if I choose a 25 percent survivor benefit, will my wife have to pay more in health insurance premiums (than with a 50 percent survivor benefit) in the event of my death? A. You can retire on any day of the month you want to.…
Q: I was a Federal Employees Retirement System employee and left the government in September 2005 under the Minimum Retirement Age +10 provision. I postponed my annuity to avoid the 5 percent penalty per year. I will be 62 in two months. Is there any advantage to waiting even longer to receive my annuity? Is it at all like Social Security, where the longer you wait, the more you receive? On the flip side, what are the downsides of applying at age 62? I understand that if I am re-employed by the government, my salary will be offset by my…