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Retiring Soon? Here Are Answers to Some Common Questions

By Sno-Cap Agency

Sunday, May 13, 2007

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When will I get my first payment?

As soon as OPM gets all your retirement records, OPM will provide “interim” payments. These payments are usually made in four days or less, on the first business day of each month. OPM tries to provide you with income until they finish processing your application.

How much will my interim payments be?

Generally, interim payments average more than 85 percent of your final benefit.

What kinds of things are withheld from my interim pay?

OPM only withholds Federal income tax. Things like your health and life insurance coverage will continue. OPM will make any necessary withholding for Federal taxes and health and life insurance premiums from the benefits sends when they finish processing your application

What information will I get about my benefits when the Office of Personnel Management finishes processing my application?

OPM will send you a personalized statement titled “Your Federal Retirement Benefits.” It details, among other things, how much your monthly payment will be. It also confirms such things as health and life insurance coverage, and provides information you will need to prepare your tax returns.

Will I be able to pay to get credit for Federal civilian service if I made no contributions?

Under Federal Employees Retirement System (FERS), you will be given the opportunity to pay for temporary service prior to January 1,1989. Under Civil Service Retirement System (CSRS), if you had service after October 1, 1982, for which no contributions were made, OPM will give you the opportunity to pay the contributions, and will tell you what difference it makes to your monthly benefit. If you had unpaid service prior to October 1, 1982,OPM does not notify you before finishing processing your application because it generally is not to your advantage to make the payment.

Can I change my health insurance coverage?

Yes, after you retire, you will still have the opportunity to change your enrollment from one plan to another during an annual open season. You cannot change to another plan simply because you retired.

Can I change my life insurance coverage?

You can cancel or decrease your coverage at any time. You cannot increase your coverage.

I retired in the last year. Will I get a cost of living increase?

Yes, but you will receive only a portion of the first increase payable. OPM will prorate the first increase based on how long you were retired before it is given. At that time, OPM will send you a notice explaining the increase. Federal Employees Retirement System cost of living increases are not provided until age 62, except for disability and survivor benefits.

© 2009 Snow-Cap Agency, Inc. All rights reserved. This article may not be reproduced without express written consent from Snow-Cap Agency, Inc.

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