CSRS actuarial reduction


Q. I worked under CSRS from 1963 to 1984 and withdrew my contributions when I left. I returned to a term position in 2002 and was informed that I couldn’t elect CSRS, so I selected a FERS pension. I am 72 and still employed. When I retire, I will receive an actuarially reduced CSRS pension. Does the reduction computation continue each year into retirement? What is the reason (law or regulation) that this reduction is itself not reduced or eliminated if I retire at a more advanced age (and will receive the pension for fewer years)?

A. By law, the actuarial reduction in the CSRS component of your annuity will be based on your age at the time you retire and calculated so that, over a typical lifetime, the total difference in your annuity would equal the outstanding amount due (refund plus accrued interest). Present value factors are used to figure out the amount by which each month’s annuity should be reduced. The PVF for your age at retirement would be divided into the amount you owe to determine that reduction. You’ll find the factors at www.gpo.gov/fdsys/pkg/FR-2011-06-03/pdf/2011-13708.pdf.


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.


  1. richard Jackson on

    what does it mean to have a permanet actuarial reduction equal to difference between the new annuity rate with survivor benefit and the old one without the survivor benefit?

  2. To eliminate the actuarial reduction, he could pay the Redeposit plus interest. Of course, that will probably be a substantial amount. I would complete SF-2803, Application for Deposit/Redeposit (CSRS) and find out how much it would cost. Also, he should have been offered a choice to select CSRS-Offset or FERS. I would also question that. It would make a substantial difference in his annuity. Under FERCCA, he may be able to have his retirement changed to CSRS-Offset.

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