Reviewed by Jonathan Teplitsky · Updated June 2026
Federal Retirement Systems Explained
The federal employee retirement system is not one plan but two pension programs (CSRS and FERS), a defined-contribution account (TSP), and a tangle of eligibility ages. If you're a current federal employee, FERS almost certainly applies. If you're a veteran who moved into federal civilian service, you may be sitting on one of the most valuable benefits and not know it: military buy-back.
The single most important thing on this page: if you served on active duty and now work for the federal government, you can typically buy that active-duty time back toward your FERS pension for about 3% of your military basic pay (post-1982 service) or 7% under CSRS. Break-even is 2-4 years of federal retirement. Most federal HR offices fail to flag this proactively.
Which system applies to you
- CSRS: Pre-Jan 1, 1984 hires. Generous standalone pension, no SS. Almost all already retired.
- FERS: Jan 1, 1984+ hires. Default for current workers.
- FERS-RAE: 2013 hires. 3.1% employee contribution.
- FERS-FRAE: 2014+ hires. 4.4% contribution.
Benefits identical across FERS tiers — only contribution rate changes.
The FERS three-legged stool
Leg 1: FERS Basic Annuity
Defined-benefit pension. Multiplier is 1.0% per year, bumped to 1.1% if you retire at 62+ with 20+ years.
Leg 2: Social Security
FERS employees pay FICA and earn SS normally. FERS Annuity Supplement bridges MRA to 62.
Leg 3: TSP
TSP is the federal 401(k). 1% automatic agency contribution + match up to 4% = full 5% agency match if you contribute 5%. 2025 deferral limit $23,500 (plus age-50 and 60-63 catch-up). Traditional and Roth.
CSRS in one screen
CSRS tiered formula: 1.5%/yr for years 1-5, 1.75%/yr for years 6-10, 2.0%/yr after 10. A 30-year CSRS career ≈ 56.25% of high-3. No FERS Annuity Supplement, no agency TSP match, no Social Security on CSRS-only service. See CSRS retirement.
Federal employee retirement age
MRA slides with birth year: pre-1948 = 55; 1953-1964 = 56; 1970+ = 57. From there:
- MRA + 30: immediate unreduced
- MRA + 10: immediate reduced (5%/yr under 62), or postponed
- Age 60 + 20: immediate unreduced
- Age 62 + 5: immediate unreduced + 1.1% multiplier bonus
- VERA: agency-offered early-out (age 50+20 or any age+25)
- FERS Disability Retirement
- Deferred: separate before MRA, collect later
The military buy-back — for veterans in federal jobs
If you served on active duty before federal civilian service, military time does NOT automatically count toward FERS/CSRS. You buy it back with a service-credit deposit:
- FERS, post-1982: 3% of military basic pay, plus interest if past interest-free window (~2-3 years after starting federal).
- CSRS: 7% of military basic pay, similar interest.
- Effect: every bought-back year adds 1.0% (or 1.1%) of high-3 to your annuity for life under FERS.
A typical four-year enlistment at $20k/year basic pay costs ~$2,400 to buy back under FERS. Adding 4 years to a 30-year FERS career at $100k high-3 adds $4,000/yr to annuity — every year for life. Break-even under a year of retirement.
See military retirement and jobs after the military.
TSP withdrawals
Plan sequencing with your annuity. See TSP withdrawal and the TSP withdrawal calculator before signing TSP-99.
Run your numbers
Estimate the basic annuity with FERS calculator, review the FERS retirement walkthrough, and confirm your service computation date with HR.