What Impact Does Sick Leave Have on the FERS Annuity Computation?

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By on February 14, 2018 in Q&A, Retirement with 0 Comments

Close up young woman's hands using a calculator at a desk to make financial calculations while taking notes on a notepad

Q. I read your answer to the question about the FERS 1% and 1.1% computation and I understand that if I retire at age 62 with 20 or more years of service, I will be entitled to a 1.1% computation factor for my FERS annuity, rather than the normal 1%.

When I reach age 62 in two years, I will have 19 years and 7 months of creditable service and over 5 months’ worth of sick leave. Because unused sick leave is used in the computation of my annuity, will my unused sick leave allow me to receive the 1.1% computation factor if I retire when I turn 62?

A. You’re not the only person who has this question; I’ve received several questions about the use of unused sick leave to reach the 1.1% computation factor.

While unused sick leave cannot be used to become eligible for retirement, it can be used in the computation. Those retiring at age 62 need only 5 years of creditable service to become eligible for retirement, so you’ve met the eligibility criteria.

Unused sick leave will be used in your computation so, yes, in the situation you outline in your question above, you will be entitled to the 1.1% computation factor for your FERS annuity. I’ve double checked this answer with other retirement experts and contacts at 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 [email protected] to discuss schedules and costs.

© 2018 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 consulting firm that specializes in federal retirement and career transition issues. He is also affiliated with TSP Safety Net. John retired from federal service after 25 years of progressively more responsible human resources positions. He is the author of Understanding the Federal Retirement Systems and Career Transition: A Guide for Federal Employees, both published by the Federal Management Institute. Federal Career Experts provides pre-retirement seminars for a wide variety of federal agencies.

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