How to Calculate FERS Retirement

Uncle Sam's Broke

Federal Employee Retirement System Employees are eligible for a special retirement annuity that is based on their earnings and years of service. This benefit is not available to any other type of employee, government or otherwise.

Step 1

Determine the total length of your service to Uncle Sam by adding together your creditable civilian and military service and any unused sick leave credit. This can include up to six months of leave without pay and also Workers' Compensation.

Step 2

Calculate your high-three average salary by using the 30 day month factor table (your supervisor or HR department can give this to you). Go through your earnings history to determine the three year period in which you earned the most. In most cases, this will be the last three years of your career.

Step 3

Use these numbers to calculate your actual annuity. The basic FERS formula gives you one percent of your high-three average salary for all your years of creditable service under FERS. If you have at least 20 years of service and are age 62 or older, then your annuity is computed using a 1.1 percent accrual factor multiplied by the high-three average salary and the years of creditable service.

Step 4

Check with your agency payroll office for rules regarding payment for other types of leave (e.g., compensatory leave, credit hours). You can also find out from your agency payroll office what deductions will be taken from this lump sum payment (i.e., Federal, State, City taxes, Medicare taxes, etc.).

Step 5

Check to see if you are eligible for the Special Retirement Supplement. A special retirement supplement is available under the FERS system until age 62. This benefit is subject to the same earnings test that is applied to Social Security benefits for recipients, age 62 -- 65.

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