FERS and Your Future Retirement: How Much Will You Receive After Retirement?

By on February 27, 2011 in News, Retirement

If you are a federal employee under the FERS system, how much will your receive for your retirement income?

For a Federal employee in the FERS system, the main components of your retirement income will be as follows:

The Annuity

  • The supplement to the annuity – until age 62
  • Thrift Savings Plan balance
  • Social Security – starting at age 62.

The purpose of this article is to provide you with calculations based on typical examples in order to help your plan for your future retirement. I have omitted Social Security in the calculation because employees already receive annual estimates of this amount.

To use this chart, select the high-three and years service closest to what you expect you will have when you retire. The amount shown is the annuity you will have earned for this combination of years and your high-three average salary.


  <— Years Service —->
 High Three 20  27  35
 $50,000  $10,000  $13,500  $17,500
 76,000  15,200  20,520  26,600
 105,000  21,000  28,350  36,750
 135,000  27,000  36,450  47,250

Before age 62, a retiring federal employee must have at least 20 years service, even with VERA (early out). An exception is MRA+: must be at least the minimum required age (56 or more) with at least 10 years service. A penalty of 5% for each year under age 62 applies to MRA+ retirements. (See Future Retirees: Do You  Know Your MRA?)

Annuity: AGE 62+

  <— Years Service —->
 High Three 5  20  27 35
 $50,000  $2,500  $11,000  $14,850  $19,250
 76,000  3,800  16,270  22,572  29,260
 105,000  5,250  23,100  31,185  40,425
 135,000  6,750  29,700  40,095  51,975

For retirement at age 62+ with 20+ years, the annuity is 10% more.

Annuity supplement.   If all your earnings have been under the FERS system, and none of your FERS earnings were prior to age 22, then you can divide the age-62 Social Security estimated benefit by 40 and multiply the result by years of FERS service. However, the Social Security annual estimate assumes you will work until age 62.   An estimate based on an estimate is not generally the most accurate, dependable method.

Or, as an alternative, just multiply your years of service (your FERS service, not your military service) by 40. For example, with 24 years of FERS service the supplement would be about (24 * 40), or $960 – more for higher grade employees and less for others.

Thrift savings. For all employees, 1% of your salary is automatically contributed by your agency. In addition, up to 3% of the amount contributed by the employee is matched dollar for dollar by the agency, while for an amount above 3%, the amount the agency will match is one half of the employee’s contribution.

In each column below, there is a range of potential money available to you through your Thrift Savings Plan that you will be able to use for financial support during your retirement. The first figure is the final amount, This assumes a 2% growth rate, compounded annually. The second number is for a growth rate of 13%. It is likely the actual result will fall between these two extremes.

The Thrift Savings Plan offers many options for handling your nest egg.  You can take it all out in a lump sum, buy a two-life annuity from an insurance company, specify how much you would like to withdraw each  month on a continuing basis, etc. There are tax implications, of course.  And there is a federal requirement for starting withdrawals at a certain age, and in a certain minimum amount.

Because the process is intricate, and so much is at stake, you may want the advice of an financial counselor.

TSP Nest Egg

  <— Years Service —->
Bi-weekly Deposit 5  20  27 35
 $20  $2,760 – 3,812  $12,890 – 47,588  $18,750 – 118,068  $26,522 – 321,384
 175  10,352 – 14,281  112,756 – 416,200  164,035 – 1,032,649  232,026 – 2,810,831
 325  44,855 – 61,879  209,421 – 772,932  304,634 – 1,917,754  430,904 – 5,220,054
 700  96,609 – 133,275  451,058 – 1,664,764  656,134 – 4,130,515  928,099 – 11,243,110

Exceptions. The following annuities are not covered in this article:

  • “special” category employees, such as law enforcement, fire fighter, and air traffic controllers. These employees can retire earlier at a higher percent of high-three, and pay more into the retirement fund.
  • CSRS, CSRS offset, and FERS transfer. CSRS figures will be covered in a future article.
  • Congressional annuities. Members of congress pay more into the retirement fund and receive a proportionately higher benefit.
  • Central Intelligence Agency Retirement and Disability Fund

Detailed, precise calculations for your individual situation are available from the nine calculators at www.fedbens.us.

© 2016 Robert F. Benson. All rights reserved. This article may not be reproduced without express written consent from Robert F. Benson.

About the Author

Robert Benson served 35 years in various Federal agencies, as both a management analyst and IT specialist. He is a graduate of Northwestern University.

38 Replies

Comments RSS

  1. Steven Kamenski says:

    i am 100% disabled By the VA I have Employeablity status and I actually work at the VA as a GS employee I am coming up on 14 years of GS service. I am only 35. will I get anything if I put in retirement now? Or should I try and get Medical retirement? I heard the VA are hard on their employees for medical retirement and deny it.

  2. FedUp says:

    I requested my retirement package this past week.  First document I see is:  Please be advised.  Until further notice, due to the ongoing backlog at the Office of Personnel Management (OPM) Branch, you may not receive your full monthly annunity check for possibly six months after your retirement date. You will however receive interim monthly payments equivalent to approximately 65% of your full annunity until OPM finalizes your retirement application.  You can expect to start to receive interim payments approximately 3 months after your retirement date.  The processing waiting period is the same regardless of the retirement date you select.  Once the Office of Personnel Management completes their process, you will receive back pay retroactive to your annuity begin date.

    I think there is a problem…….  I showed some of my coworkers today and they thought it was a joke; had to give them a reality check.  I don’t have enough time in my day to be able to make this type of garbage up.  Your thoughts.

  3. JimboAtlanta says:

    Unfortunately the 21K I will receive from FERS is the smallest part of my retirement plan. Fortunately I have retirement from a private industry job and have put the maximum allowed into my TSP. Not including TSP I will retire in December with a net of around 6K monthly. Barely enough in this down economy but I am ready to retire and do other things with my life while I am still young enough.

  4. Christine Schiraldi2 says:

    The answer to this question is likely somewhere relatively easy to reach but I thought I’d post it here for the sake of expediency.

    If I retire with 20 years @ age 63 under FERS, and opt to get my Social Security @ the same time, will the Social Security payment offset the retirement annuity?

    With a birth date of 1950, what is the age I need to reach for my SSA benefit to be 100% – that is, not reduced by a certain % each year because I’m below the age of full SSA payment?

    I’m trying to determine whether to retire @ 63, 65 or 70………and it’s not an easy decision when I don’t have even a guesstimate of the numbers. Our retirement staff is swamped these days with estimates & retirements so if I can get a “down & dirty” answer, even just an educated guess, it will give me @ least some baseline info to ponder over the next few years. And I won’t be bugging the retirement staff unnecessarily.


  5. Dan says:

    The only thing I expect from my FERS retirement is a swift kick in the ( Y ) . The annuity (if there is one) will be miniscule, Social Security broke, and my TSP contributions in hawk to cover the deficit spending (yes it’s been done before). Perhaps I can aspire to a post-Soviet Union style retirement; selling apples or something to supplement the “annuity”. Congrat’s to those who left on top of the Ponzi scheme.

  6. Guest says:

    Thank you for your articles. If possible, please do an article that would compare which choice would be the best for a 51 year old employee with 25 years service (Early out retirement offer or disability retirement).

    Thank you.

  7. Bruce_porter says:

    What is the federal requirement to withdraw tsp at a certain age and certain amounts?

  8. faaguy says:

    As previously mentioned, the retirement pay from FERS is miniscule – it will barely cover your health and dental insurance premiums as time goes on.

    Take your sick days as needed – don’t save them for any increase in retirement pay – it does not compute.

    Fund your TSP to the max including the over 50 contribution.

    If you work past the Social Security retirement date 65 +, take those dollars now and put them in another savings program, IRA, Roth IRA. Live on your normal paycheck.

    If the government goes broke, government employees will not be the only one affected.

    Put 5 – 10% (or more) into gold and silver. Have you heard about ETF’s.

    The only thing certain about life is death – and who wants to know about that day.

    The worst thing about “retirement” is finding out how to enjoy doing nothing.

    If anyone knows how to enjoy doing nothing without “worrying”, please let me know.

  9. Fed Peasant says:

    It only requires 5 years for a deferred pension.

  10. Mary Duvall3 says:

    Does an employee have to work 10 years, versus 5 years, to retire and collect even a tiny amount of FERS, and also buy health insurance?

  11. Lop says:

    If you are worried about a RIF I can recommend the BOP. Go into a agency that cannot simply get rid of anyone. If they got rid of us all the inmates would run wild. I would say we have excellent job security.

  12. Guest says:

    Hi Robert: Just curious why you’re listing the scenario of a $700 biweekly deposit when the optimal amount is currently limited by the IRS to $635?

    Don’t get me wrong: I’d love it if we could contribute that much and more, only wondering your reason for listing the amount. 🙂

    • Fedbens says:

      Just arbitrary on my part, I guess. I wasn’t sure what the max was, so I did $700, feeling pretty sure it would work.

    • guest says:

      Well, YOU can contribute 635, plus the agency match, so that will get you above 700 in most cases.

      • Guest says:

        Very good point.

        And you’re right: if someone can afford to contribute the maximum amount, then his or her salary is likely high enough that the total biweekly contributions will be significantly more than $700.

      • Grood says:

        Don’t get me wrong, but I think your figures are off base. The maximum allowable for contribution from the IRS is $16,500.00 unless you are over 50. Over 50, you are allowed another $5,500.00. Under 50 you are allowed $16,500/26 = $635.00/PP with over 50 allowed $5,500/26 = $212.00 so the max anyone can contribute to the TSP is $847.00/PP. Sorry to burst your bubble but $847.00/PP also includes the agency match.

        • John Donaldson says:

          Amazingly, the agency match is not included in those numbers. You personally can contribute 22,000 but you agency will still contriubte their share to your TSP! So if you’re making $100,000 you’d actually have 27,000 added to your TSP account. If you’re already contributing the maximum, check your annual statement to verify this.

    • Oly_WA says:

      It was not mentioned that up to a few years back we could only contribute a % of our pay – I think it was 15% max and that was changed every year – think when I started it was at 7%. Therefore, the above “TSP Nest Egg” amounts are very skewed… you couldn’t have done some of those amounts even if you had the income to do so. I remember upping my contribution every chance I got, but being at a lower grade, it seemed so small. Now everyone can do up to 16,500 or if over age 50, 22,000.

    • Afed says:

      Counting the Government contribution, I have $815.52 going into my TSP every two weeks. Youe forgot the agency contribution.

  13. buckeye says:

    Ricky – I admire your optimism, but you seem to be under the illusion that you are still going to have that job in 5 years let alone 20. Let’s face it our employer (i.e. the gov’t) is flat broke. If we do not get the long-term deficits under control I fear massive furloughs and RIFs are coming in the near future, and we won’t be able to do a darn thing about it. Anyone with less than 10 years of service (which includes myself) better be worried…you are a prime candidate to be let go just before you become eligible for a deferred pension. Either that or anyone within 5 years of MRA will be forced into early retirement.

    • Amy says:

      I do not understand your comments Buckeye. Because if he has saved over $1M, then he has over $1M, regardless of his working status. It is his.

      Not too many people with a job anywhere can tout savings like that – excepting the super rich folks who still get those tax breaks.

      • Bill2523 says:

        The super rich who pay the majority of federal income taxes… Curse their ungrateful successes!

        • retiree says:

          Seems to me the middleclass pays most of the federal income taxes-the super rich have shelters

          • Yrrab24 says:

            Retiree you are wrong you need to check your facts —the middle class don’t pay anywhere close to what the rich pay. the top 2% earners in this country pay approx 60% of all taxes—sorry!!!

          • recent retiree says:

            Quote from USgovinfo.com about 2007:
            •The top 1 percent: Americans who earned an adjusted gross income of $410,096 or more accounted for 22.8 percent of all wages. But they paid 40.4 percent of total reported income taxes, an increase from 39.9 percent in 2006, according to the IRS.
            •The top 5 percent: Americans who earned $160,041 or more accounted for 37.4 percent of all wages in 2007. But they paid 60.6 percent of the country’s total reported income taxes, up from 60.1 percent a year earlier.
            •The top 10 percent: Americans who earned at least $113,018 paid 71.2 percent of the nation’s income taxes, up from 70.8 percent a year earlier.
            •The top 25 percent: Americans who earned at least $66,532 paid 86.6 percent of the nation’s income taxes, up from 86.3 percent a year earlier.
            •The top 50 percent: Americans who earned at least $32,879 paid 97.1 percent of the nation’s income taxes, up from 97 percent a year earlier.

          • Carly says:

            I think we are confusing income with wealth. The wealthiest among us don’t earn a paycheck.

            The top 20% of our fellow citizens own 93% of the financial wealth; those are 2006 numbers*, so it’s even more lopsided, now.

            In addition to getting their income tax rate reductions extended, the wealthy also got the “death tax” revoked so they can now pass their estates on their heirs without contributing a dime to the running of the country. They also got their capital gains tax rates lowered below their income tax rates, so they won’t be contributing much on that end.

            Don’t know exactly how it is done, but somehow “they” (e.g., Rupert Murdoch) get the folks who are getting screwed by all this, to point at each other and say that we don’t deserve anything better. If we did, then we’d be rich!

            *source: http://sociology.ucsc.edu/whor

          • Leo says:

            Yrrab24…YOU need to check your facts!!!

          • Scrawford5252 says:

            Possibly as a prorata share of all taxes paid but not as individuals.  Don’t try to pull that math trick.

      • buckeye says:

        Amy – he didn’t say he already had $1M – he said he “should have” by the time he retires in 20 years. The only point I’m trying to make is that too many federal employees (including myself) are complacent. People seem to think they are always going to have their job and nobody is going to take it away from them – some even feel they are entitled to it. Expecting to have $1M in your TSP by the time you retire requires some very iffy assumptions, like working a full 30-35 year career, maxing out your contributions every year, agency match staying the same, and averaging a 7-8% return. Chances are at least one of those assumptions is not going to pan out.

        • No_Finer69 says:

          agree with buckeye, I have worked for the last 22 years and have about $280K and that is with putting in over $750 bi-weekly for the last 7 years…I will work another 10 years but I don’t see myself over $1 million

      • Yrrab24 says:

        Excuse me but the super rich folks you speak of–are the ones you should be thanking for paying the largest portion of taxes in this country…If it wernt for them YOU would be paying a great deal more…

      • C BREWER says:

        he may have saved 1mill$ but who is to say uncle Sam has not pilfered it the way a lot of commercial firms did the retirement moneys of their employee. 

    • C BREWER says:

      buckeye i agree that why i am getting out at the end of the year

  14. Ricky says:

    I started contributing to the TSP when I began my federal job at the age of 19. I guess it will pay off considering how much I have in it now – 20 years later. I still have 20 more years to work, maybe more since I like my job. I should have well over 1 million in it. Isn’t that crazy! I remember going through the human resource process my first day on the job, and they told us about the TSP and how good it was. I didn’t know what it was, but thought I better join in on it! I am glad I did.

    • Boatmax says:

      If taxes go up, as they will during your work career you may not have as much as you think. Tax increases erode your net retrirment.

      • SSAFedGuy says:

        Yes, and considering that fiat currencies are being debased by inflation of the money supply (money printed out of thin air by the central bank), our US dollar could lose 30 to 50 percent purchasing power in a sudden currency devaluation. And, if/when our world reserve currency US (fiat) dollars are eventually replaced by future gold-backed currencies, like the northern Euro, the Yuan, the Ruble, and a mid-east dinar, then the purchasing power of a million dollars will really go down. But, 1 million dollars in the TSP will still be a lot more than most other people will have; so, you’ll still be ahead of most of us, relatively speaking.