I Took EPA’s Buyout Offer; When Should I Leave?

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By on August 2, 2017 in Q&A, Retirement with 0 Comments
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Q.  I’m a FERS employee working for the Environmental Protection Agency. I have accepted the VERA/VSIP offer and am wondering when to set the effective date of my retirement. The agency has set the final day to leave as September 2, the end of a pay period. Somewhere I heard that it is best for a FERS employee to leave at the end of the month; what should I do?

A.  Leave on August 31, not September 2.

If you are covered by the FERS retirement system, your annuity begins to accrue on the first day of the month following your last day on the rolls. If you were to retire on the last day of the pay period (September 2), your FERS annuity would begin to accrue on October 1 and you would receive payment on November 1 – almost two full months after your last day on the rolls.

However, if you retire on August 31, your FERS annuity will begin to accrue on September 1 and you would receive your payment on October 1. The only people you make happy by retiring at the end of the pay period on September 2 will be those who work in payroll.

Readers should note that this answer is for an employee covered under the FERS retirement system. An employee under CSRS could retire on September 2 and their annuity would begin to accrue on September 3. The CSRS retiree would receive a pro-rated annuity (for the period September 3 through September 30) on October 1.

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 [email protected] to discuss schedules and costs.

© 2020 John Grobe. All rights reserved. This article may not be reproduced without express written consent from John Grobe.

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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.

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