High-3 calculation


Q. I have been on FERS disability retirement from the Postal Service since November 1996. I turned 62 in October and received a letter from the Office of Personnel Management notifying me that my annuity was recalculated and what my new monthly annuity would be.

My creditable service calculation is correct, but the high-3 doesn’t look right. FERS Publication RI 98-1 states, “The total service used in the computation is increased by the amount of time you were on the disability annuity roll and your average salary is increased by the FERS cost-of-living increase during the time you were on the roll. The basic annuity formula is then applied, using the adjusted time base and average salary.”

When I retired in 1996, my base salary as a PS4 Step F was $ 33,294. FERS tells me that my new high-3 is $ 33,934. Does this new high-3 seem correct for 16 years of FERS COLAs? (Currently, PS4 Step F base rate is $ 42,031).

A. I don’t do numbers, so I can’t confirm or refute the figure OPM gave you. What I can do is provide you with the COLA increases FERS retirees received beginning with the first full one you would have been entitled to: 1998 2%, 1999 1.3%, 2000 2.0%, 2001 2.5%, 2002 2%, 2003 1.4%, 2004 2%, 2005 2%, 2006 3.1%, 2007, 2.3%, 2008 2%, 2009 4.8%, 2010 0%, 2011, 0%, 2012 2.6%.


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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