Deferred Retirement for a Departing Federal Employee

These are some facts about deferred retirement that could be critical for a federal employee.

In a recent article about your federal benefits if you leave federal service before becoming eligible to retire, I devoted one small paragraph to an important fact.

If you leave your retirement contributions on deposit with the Office of Personnel Management (OPM) and had five or more years of creditable federal civilian service, you will be entitled to a deferred annuity (pension) at a later date.

This article is a brief description of what OPM calls “deferred retirement”.

Facts About Deferred Retirement

Let’s look at some of the facts about deferred retirement.

  • Under deferred retirement you are not allowed to enroll in Federal Employee Health Benefits (FEHB). Per OPM rules, only those who are entitled to an “immediate annuity” can take their FEHB into retirement.
  • The same applies to your Federal Employees Group Life Insurance (FEGLI).
  • FERS deferred retirees are not eligible for the Retiree Annuity Supplement.
  • If a former employee dies before they are eligible to apply to OPM for a deferred annuity, their surviving spouse will be ineligible for a survivor annuity, and will only receive a refund of the deceased employee’s retirement contributions.

Deferred Retirement Differences Under FERS and CSRS

Eligibility criteria for deferred retirement differs between CSRS and FERS, with the FERS criteria being more flexible. The criteria are listed in the table below.

Retirement System Minimum Age Minimum Service Special Qualifications
  • 62
  • 60
  • MRA
  • MRA
  • 5
  • 20
  • 30
  • 10

FERS contributions must be left on deposit with OPM.

Age based reduction for under 62 (MRA+10)

CSRS 62 5 CSRS contributions must have been left on deposit with OPM.


Agencies can request to have John Grobe, or another of Federal Career Experts' qualified instructors, deliver a retirement or transition seminar to their employees. FCE instructors are not financial advisers and will not sell or recommend financial products to class participants. Agency Benefits Officers can contact John Grobe at to discuss schedules and costs.

About the Author

John Grobe is President of Federal Career Experts, a firm that provides pre-retirement training and seminars to a wide variety of federal agencies. FCE’s instructors are all retired federal retirement specialists who educate class participants on the ins and outs of federal retirement and benefits; there is never an attempt to influence participants to invest a certain way, or to purchase any financial products. John and FCE specialize in retirement for special category employees, such as law enforcement officers.