Q: I plan to retire from Defense Department in four years when I turn 60. At that time I will have 25 years of creditable service. I received a CSRS Offset Retirement Estimate from my personnel office. I owe $8,500 of unpaid CSRS redeposit. I’m trying to determine whether to pay it back now or just have it taken out monthly when I start receiving my retirement. The projection shows they would deduct $71 per month from my annuity. I have to give 50 percent of my retirement annuity to my former husband. I don’t really want to take $8,500 from my savings and have him benefit from it. Does it make sense (and benefit me) for me to pay back the $8,500?
A: I can’t tell you whether it makes sense to redeposit that money. That’s a decision you’ll have to make based on how much your annuity would be increased and an estimate of how long you’d receive it versus what that money could earn for you elsewhere. What I can tell you is that you’d have to make the redeposit before you retire. Redeposits cannot be made after you are on the annuity roll.