Break in service and vested time

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Q. I am a 29-year-old federal employee and I may have to move at some point in next few years because of my husband’s work or if I go back to school. I have been working for 2½ years; if I leave, I am hoping to return to a job in the federal government at some point). I am wondering how vesting works for my FERS annuity. Will I have to work a consecutive five years to keep both before I can leave, or do I bank that time if I decide to come back? For example, if I work for 3½ years then leave and come back two years later and work for 30+ years, will I keep what was put into my annuity during my first 3½ years when I come back?

A. You have to have five years of service to be vested in the retirement system. Those years don’t have to be consecutive. For example, if you left after 3½ years, came back after a two-year break, and worked for 1½ more years, you’d be vested. If you took a refund of your retirement deductions when you left, you’d have to redeposit that amount, plus accrued interest.

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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.

24 Comments

  1. I have worked for the veterans affairs for 3.5 years. Thinking of taking a job in the community but working at the va part time 16 hrs per week. Can you acquire a vested status while working part time for the next 1.5 years?

  2. Hello!

    I am working at the VA as an intermittent employee. I currently do not receive benefits. Will I still be considered “vested” if I work for 3+ years, or does that only count if I am fulltime?

  3. Hi! I also work for the VA Hospital as a permanent employee. This October will be three yrs of consecutive employment.
    1. How many years would I need to be vested?
    2. If I decide to have break in service to work for private sector, how many yrs do I need to have completed first? Thanks

    • To be vested in the retirement system, you have to have three years of creditable service. Once vested, you could leave and work elsewhere. However, to be eligible for a retirement benefit, you’d have to have a minimum of 5 years of creditable service.

  4. Kozfey Murray on

    I would like to get my retirement from my years with the VAMC .How can this happen? I am at my actual retirement age as of December 16th.

    • Assuming that you’re a current employee, which retirement system are you in, CSRS or FERS? What is your date of birth? How many years of service do you have?

  5. Wayland Strickland on

    I have 10 years with the VA, and I paid my military deposit (14 years, 9 months, 18 days), so my total time is 24 years 9 months. I’m leaving to return to school full-time. If I come back after 3-5 years, I’ve been told I would be starting over, e.g. all that time is gone b/c of the break in service? Is that true?

    • No, it isn’t true. As long as you don’t ask for a refund of your retirement contributions and military deposit, you would get full credit for all that time when you return to work for the federal government.

  6. Mr. Jones, I worked for DoD for 4 years between 1991-1995. I withdrew my annuity contributions when I left. After 22 years elsewhere, I am considering returning the Federal workforce. Would I be able to “buyback” my 4 years of civil service by paying back my annuity with interest? If I could, it would seem I’d only need to work one year to be eligible for a 5 year deferred retirement. It seems most former civil servants can do so, but I appear to fall in a null zone according to OPM website. The language below is from OPM (and also repeated in instructions on the SF 3108):

    ‘Historically, if you receive a refund of FERS deductions after the effective date of your FERS coverage, you could never redeposit these funds, and the period covered by the refund would not be used to establish title to an annuity or in calculating the annuity benefit.
    However, one of the provisions of PL 111-84 allows individuals who were covered under the FERS system on or after October 28, 2009, to make a redeposit for refunded FERS service. If the redeposit is not paid, the service is still used toward title and in the average salary computation, but not to compute the annuity benefit.”

    thanks.

    • You are misreading the language. What it means is that if a FERS employee who took a refund of his retirement contributions returns to government service on or after October 28, 2009, he CAN redeposit that money. What it doesn’t say is that he would also have to pay the accrued interest.

  7. Well, that is wonderful news. Thank you very much. The amount I withdrew was very small after just four years, so interest should not be a big issue even after all these years. Key for me is now knowing that once I redeposit the money that:
    1. I will be starting my federal service with 4 years FERS civil service credit;
    2. Work one year and I am 5 year deferred retirement eligible;
    3. Work three years and my high three is much better since salary in 1994 was not so great; and if I
    4. Work five more years I would be eligible to maintain FEHB (assuming I enroll immediately upon re-entering the federal work force). [Actually I did have FEHB those first four years I worked, so maybe I would only have to work one more year to be eligible to carry over FEHB?]

    Thank you again for your very helpful and incredibly prompt reply.

    • Glad to be of help. P.S. if you were enrolled in the FEHB program when you left and immediately reenroll when you return to work for the government, those two periods will be treated as if they were continuous.

  8. Of help? Your answers regarding these federal benefits and how they apply to my situation were much more than that. They were enormously beneficial to me and may have helped steer me towards federal service as I re-chart the last chapter of my career. I don’t know how you stay on top of all these inquiries and respond with such promptness and authority, but you are a treasure.

  9. Hello, I worked for the National Labor Relations Board (FERS) for 4 years and left to work with California MTA and California Department of Justice (CalPers). My question is do either of those California state agencies have reciprocity with the Federal government? If no, would I be able to purchase the 1 year left to vest in FERS?

  10. Sir, Your information has been helpful. Thank you for your time. So that I am clear, the five year rule for FEHB means that any total of five years prior to retirement allows one to take FEHB into retirement. So if I have 10 years of continuous federal service and was enrolled in FEHB the whole time, I could leave federal service for 15 years, the return to federal service at age 61, work for a year, and then retire with health benefits?

  11. Sam - Concerned Fed on

    Quick question:
    I have had multiple breaks in service due to military service since I joined civil service in 1999. I bought back my 84-92 active duty time and have continued to buy back all of my other military time from those breaks…my question is about health benefits continuing into retirement. This year I had a three month LWOP for military service and I’m looking to retire in less than five years. (My MRA is in 3yrs/2mo, and I’ll have 30 years of service) Will that three months LWOP trigger a requirement that I serve five more years in order to take my FEHB into retirement? Or, does USERRA protect me in that regard as well?

    • USERRA has nothing to do with it. To be eligible to carry your FEHB coverage into retirement, you have to be covered for the 5 consecutive years before you retire. As long as you were enrolled in the program before you went on LWOP and re-enrolled on your return, your enrollment will appear to have been seamless. Assuming that the FEHB enrollment periods before and after your LWOP total 5 years before you retire, you can carry that coverage into retirement.

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