I recently had the pleasure of listening to one of Johnny Paycheck’s greatest hits, Take This Job and Shove It, and it made me think of federal retirement. How, you might ask? Because, if you told your boss to take this job and shove it before you were eligible for retirement, it could adversely affect your benefits.
So, even if “…that foreman, he’s a regular dog” and “…the line boss, he’s a fool”, think twice before using these immortal words written by David Allen Coe and telling management to take your federal job and shove it. Remember, Johnny Paycheck and David Allen Coe were referred to as “outlaws”, and you might not want to be an outlaw when it applies to your retirement and benefits.
Because there are almost no CSRS employees who are not already eligible to retire, the rest of this article will deal with FERS employees.
If an employee were to “get the nerve to say” to their manager that they should take this job and shove it prior to having attained retirement eligibility, but left their FERS contributions on deposit with OPM, they will become entitled to a deferred annuity at a later date.
However, employees who elect deferred retirement are not allowed to take their Federal Employee Health Benefits or Federal Employees Group Life Insurance into retirement. They are also not eligible for the Retiree Annuity Supplement. If a former employee dies before they are eligible to apply to OPM for a deferred annuity and had at least 10 years of service (5 years civilian) at the time they “blew their top”, their surviving spouse will be eligible for a survivor annuity. If they have less service, their spouse will not be eligible for a survivor annuity and will only receive a refund of the deceased employee’s retirement contributions. The table that follows outlines the age and service requirements for deferred retirement under FERS.
|FERS contributions must be left on deposit with OPM.
Age based reduction for under 62 (MRA+10)
So, if our federal employee was 40 years old and had 15 years of service when they told their boss that they “better not try to stand in my way as I’m a-walkin out the door”, they would be entitled to a reduced FERS annuity at age 57 (their Minimum Retirement Age), or to an unreduced FERS annuity once they reached 62.
If you feel so strongly that you would “give the shirt right offa’ (your) back” to tell your manager what to do with your federal job, take some time to consider the ramifications to your retirement and benefits.