OPM’s new Online Retirement Application (“ORA”) is in full force, and many federal employees leaving service have felt the challenges of figuring it out by themselves.
Earlier this year, I was lucky to add to my team a seasoned expert from OPM’s retirement services. They bring the “inside baseball” at a time when our clients and the federal community need it the most. This article will focus on a few of these details.
On paper, ORA represents real progress. The structure is more current, information moves more cleanly, and OPM has finally begun shifting away from systems that were built decades ago. It is a major undertaking, and once fully operational, should benefit the entire federal workforce. The problem is that it’s a brand-new system, and with it comes a bumpy implementation.
What the New System Aims to Improve
For years, retirement processing relied heavily on manual work. Case files moved slowly, and it was common for new retirees to wait months before receiving their first full payment. The modernized platform attempts to:
- Reduce errors caused by duplicate hand-entry
- Shorten the time between separation and first payment
- Provide better visibility into what stage a case is in
- Replace outdated tools that were expensive and difficult to maintain
The intention is good. The rollout is the challenge. Agencies are adapting on the fly, and instructions are shifting as new information arrives. Compounding the issue is everything that’s happened in federal service this year.
OPM has been upfront about this. They’ve expressed optimism but have been clear about how a new system will come with its problems, and it may add time, not reduce, at first.
How it Works
Retiring federal employees should understand the timeline and steps, outlined below.
If you’re looking at retirement, you need to let your agency know. Easy, right? Sure.
Then what? In most agencies, instead of beginning the paperwork, HR queues off the new ORA portal, and you receive an invitation email. When? When they get to it.
This is the first big challenge feds are facing. HR is strained, and in some cases, unreachable. They’re overwhelmed with requests, and you should anticipate delays and hand out grace like candy.
That said, I understand that you may have a retirement timeline you need to meet. If HR is not responding, use the subject line in your next email: “I Need Your Help”. These magic words have worked miracles for clients over the years in getting them the assistance they needed. Use as you feel necessary.
Once ORA has been initiated, you’ll get the email to begin the portal. It’s mostly self-explanatory once you’re in, but you need to understand how to make benefit elections and fill out certain forms (like everyone’s favorite: W-4P). That’s beyond my scope for this specific article.
Notably, I suggest you run a retirement estimate from GRB or equivalent before completing ORA. This will help you verify that the information about your retirement date, high-3 salary, creditable service time, sick leave, annual leave, proration, etc., is all correct. Then, once in ORA, check the system to make sure it matches.
Once ORA is submitted, it goes to your HR for final processing. Note that it can come back to you for more action, so BOLO. Then it goes to payroll, and from payroll, it hits OPM for final processing. Once OPM has accepted it, you’ll receive an email confirmation from them and eventually be assigned a case number for final retirement processing at OPM.
What Federal Employees Can Do Right Now
There are several practical steps employees can take to reduce confusion and protect their options.
Keep Detailed Records
Save every instruction, message, and confirmation you receive. Documentation becomes critical if details shift later. Download your eOPF documents, and make sure you have all your service history details. If there is a discrepancy, you’ll need this to correct it with OPM.
Clarify Your Retirement Choices
Decide what matters most in your retirement plan. Focus on cash flow; I call it the heartbeat of retirement. Your portfolio’s job is to support your lifestyle expenses while fighting against the “silent retirement killer”: inflation.
Taxes are critical. For our clients, it’s their highest line-item expense in retirement. Every financial decision in retirement comes with a tax consequence, and you need a plan to make sure you’re keeping the most of your money in your pocket, not “tipping Uncle Sam”.
Model Different Scenarios
Consider running multiple retirement paths. What if the markets crash? What if you spend more in early retirement? What if you have an expensive long-term care event later in life? Reviewing these helps you identify—and mitigate—risks that could make your retirement look very different than you wanted.
Hoard Cash
If you can save more in your bank accounts, do so. Building up a cash reserve is a smart move for someone thinking about retirement. Yes, annual leave helps, but OPM is going to have delays in processing your pension. Plan for at least 6 months of your total expenses.
Looking Ahead
Modernization is the right direction. The difficulty lies in the overlap between a new system and an old process that people still understand better. Employees are being asked to adapt while agencies are learning how to use the new structure.
Right now, it’s creating more questions than answers. If you can get ahead of the questions, you’ll be well prepared to move toward the next season of your life. After all, it’s not just your money, it’s your future.
