FERS Retirement Explained
FERS basic annuity = High-3 × years × multiplier (1.0% standard, 1.1% if you retire at 62+ with 20+ years). The 1.1% multiplier is the single most under-appreciated rule. It's worth 10% more annuity for life. Many federal employees retire at 60 with 20 years thinking they've optimized. They haven't — waiting two more years to 62 unlocks both the higher multiplier and two more years of service credit, lifting lifetime annuity 20%+.
Reviewed by Jonathan Teplitsky · Updated June 2026
The FERS Three-Legged Stool
- FERS Basic Annuity — OPM pays for life.
- Social Security — pay FICA, collect normally.
- TSP — defined-contribution, up to 5% agency match.
Compared to CSRS, FERS basic is smaller but trade off is SS coverage and TSP match.
The Formula
Basic Annuity = High-3 × Years × Multiplier
- High-3: Highest 36 consecutive months of basic pay.
- Years: Creditable civilian + bought-back military + unused sick leave.
- Multiplier: 1.0% in most cases. 1.1% if retire at 62+ with 20+ years.
Use FERS calculator for estimates.
Three Worked Examples
Example 1: MRA + 25 at $90,000 High-3
GS-13 retires at MRA (57) with 25 years, High-3 $90,000: $90,000 × 25 × 1.0% = $22,500/yr ($1,875/mo). Plus FERS Annuity Supplement until 62.
Example 2: Age 62 + 32 at $115,000 High-3
GS-14 retires at 62 with 32 years, High-3 $115,000. 1.1% multiplier: $115,000 × 32 × 1.1% = $40,480/yr ($3,373/mo). If retired at 60 with 30 yr: $115,000 × 30 × 1.0% = $34,500. Waiting 2 years added $5,980/yr for life.
Example 3: The 10% Trap at Age 60
IRS employee retires at 60 with 20 years, High-3 $80,000: $80,000 × 20 × 1.0% = $16,000/yr. Working two more years to 62 with 22 years: $80,000 × 22 × 1.1% = $19,360/yr. 21% larger pension forever for two more years of work.
Eligibility
- MRA + 30 — MRA is 57 if born 1970+. See retirement age.
- Age 60 + 20 — 1.0% multiplier.
- Age 62 + 5 — 1.1% multiplier if also 20+ years.
- MRA + 10 — reduced 5%/yr under 62, or postponed.
- DSR/VERA — involuntary separation or agency early-out.
FERS, FERS-RAE, FERS-FRAE
Legacy 0.8% / RAE 3.1% / FRAE 4.4% employee contribution. Benefits identical.
FERS Disability Retirement
- Year 1: 60% of High-3 minus 100% of SSDI.
- Years 2+: 40% of High-3 minus 60% of SSDI.
- Age 62: Recalc as regular FERS annuity.
Survivor Benefits
- Full survivor (50%): annuity reduced 10%, spouse gets 50%.
- Partial (25%): reduced 5%, spouse gets 25%.
- None: requires spousal written consent.
COLAs
CPI≤2%: matches. CPI 2-3%: 2%. CPI>3%: CPI-1%. Most FERS retirees no COLA until 62 (exceptions: FERS Disability, special-category LEO/FF/ATC).
Special Categories: LEO, FF, ATC
- MRA 50 + 20 yrs, or any age + 25.
- Enhanced 1.7% multiplier on first 20 years.
- Mandatory retirement at 57 (LEO/FF) or 56 (ATC).
Military Buy-Back
Post-1982 deposit: 3% of military basic pay, plus interest if past 3 years. Pre-1982 may be creditable without deposit. Four years at $30k average basic pay = ~$3,600 deposit. On $90k High-3, four years adds $3,600/yr to annuity. See military retirement.
Action items
- Pull recent SF-50, verify Service Computation Date.
- Request personalized FERS estimate from HR.
- If post-1982 service, request DD-214 and DFAS deposit calc.
- Plan TSP withdrawal alongside annuity.
- Approaching 60 with 20 years? Run numbers on waiting until 62.
Sources
OPM Retirement Services, 5 U.S.C. Chapter 84, OPM RI 90-1 FERS Handbook.