Buy back and retirement

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Q. I served in the military on active duty for 14 years. I am in the process of buying back my military service as a credit toward retirement with the federal agency with which I am currently employed. Once my military service is paid, do I still have the option to retire after 20 years of service as I would with the military? How much of my pension could I expect?

A. With 20 years of service,. you could retire on an immediate, unreduced annuity at age 60. With 30 years of service. you could retire on an immediate, unreduced annuity when you reach your minimum retirement age. MRAs range from 55 to 57, depending on your year of birth. Your annuity would be based on your highest three consecutive years of average civilian pay (your high-3) and your years of service (civilian and military for which you’ve paid a deposit) using this formula:

.01 x your high-3 x years of service (.011 if you retired at age 62 with 20 years of service.)

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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.

7 Comments

  1. I AM A 0.40 FTE FERS EMPLOYEE( PART TIME) FOR 20 YEARS WITH AN ADDITIONAL 5 YEARS OF REPURCHASED MILITARY TIME FOR A TOTAL OF 25 YEARS. HOW WILL THIS AFFECT THE FORMULA (0.01 x HIGH THREE SALARY x YEARS OF SERVICE) ANNUITY PENSION WHEN I RETIRE?

  2. Larry Leojn Perrow Sr. on

    Catch 62
    I served in the United States Air Force (USAF) from (1 Dec 1951 Thru 30 Nov 1971 20 Years), Retired as a T/SGT (E6) and Worked for Civil Service at Pensacola, NAS for 14 Years and 8 Months, for a total of 34 Years and 8 Months of Federal Service. I Retired as a GS11
    From 1951 until 1956 the Military didn’t have to pay Social Security. But if we wanted to combine our Retirement, we had to pay the Government back 7% of all the money we made from 1951-1956.
    I paid every last penny back to The US Government.
    By doing that I got a combined Retirement of USAF and Civil Service.
    But when I reached age 62 and started My Social Security they gave me a reduced amount of Social Security starting at $ 255.00 a Month. Why were we treated this way.
    I am now 83 (2-6-2016) and I only get $ 281.00 a month for 34 Years from Social Security. Every Cola Pay for years went to Insurance.
    Finally I got a cola that gave some Take Home Money ($ 5.00).
    If I didn’t pay the money back and combined my Retirement, when I reached 62 they would Re-compute my Retirement, and drop off all of my Military Time.

      • Austin B. Nute on

        Dear Sir,
        I have 43 years of Gov’t service in two different agencies. I worked for the Postal system for 12 years under CSRS which was followed by the U.S. Dept. of Commerce for the remainder. This includes 4 years of military service. There was a break of more than a year between the two.
        I was classified as being (Offset CSRS) in the Dept. of Commerce but I have always paid into Social Security both in the Postal Service and the Dept. of Commerce.
        Under the windfall elimination provision, the Social Security benefit of anyone receiving an annuity in whole or part from a retirement system where he didn’t pay Social Security taxes, such as CSRS, and has fewer than 30 years of so-called substantial earnings under Social Security will have his annuity computed under a modified formula. As I said, I have always paid into S.S. in every job I have ever had. I am 75 years old. Shouldn’t I be exempt from WEP/GPO under these conditions?

        • Because you had a period of service under CSRS – a retirement system where you didn’t pay Social Security taxes – you were subject to the windfall elimination provision. When you worked for the Postal Service, you weren’t covered by Social Security. Any deductions taken from your pay were for Medicare Part A. Since your Social Security benefit was reduced, it’s because you had fewer than 30 years of substantial earnings under Social Security. For more information about the WEP, go to http://www.ssa.gov/pubs/EN-05-10045.pdf

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