Which retirement system is best?


Q: I worked for the federal government from 1968 to 1986, then worked in the private sector from 1987 to 2005. I withdrew my retirement money when I left government service. If I return to federal service, should I opt to be placed in the Federal Employees Retirement System or Civil Service Retirement System? I assume it would make sense to re-deposit the money I withdrew and pay the interest?

A: If you returned to work for the government you would be placed in CSRS Offset (CSRS and Social Security) with the option of transferring to FERS. Even if you were to transfer to FERS, you would still have a CSRS component in your annuity. If you repaid the money that was refunded to you, plus accrued interest, you’d get full credit for the time in determining that portion of your annuity. If you didn’t, you’d still get credit for the time in determining your years of service; however, your annuity would be actuarially reduced by the amount you owe and your age when you retire. As for which retirement system would be best for you, only you can say. Take the time to review the advantages and disadvantages of each system before you decide.


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.

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