This page can be found on the web at the following url: http://www.opm.gov/retire/faq/pre/faq9.asp
Here are answers to frequently asked questions about planning for retirement in five years.
How do I begin planning for retirement?
You should begin planning several years before the date you have set
for retirement so that you will know what is required to continue
certain benefits into retirement. There are many factors related to retirement planning, and it is literally never too early to begin. The
federal annuity is only one element to consider in today's complex
financial scene. You may need to start a Thrift Savings Plan or IRA
schedule many years before considering actual retirement. Other
considerations, such as Social Security may affect your benefits.
However, the best place to begin is with your local personnel service
center. They can provide personalized assistance and they have your
Your health and life insurance coverages are of immediate concern now because you must carry coverage continuously for at least five years before your retirement or you may be ineligible to continue them.
What will my employer do to help me plan for retirement?
Your agency will guide you through the retirement process, supplying
all of the information you need about retirement and insurance. They
provide the information you need to plan for retirement, but should not
advise you on what to do. You should contact your local personnel
service center for assistance because they have your employment records.
When should I begin planning for retirement?
The five year period before retirement is important because you must
have insurance coverage for five years immediately before retirement to
keep it after retirement.
You may also need some preliminary information to make decisions
about when you can afford to retire and whether to make any necessary
payments to receive credit for military or non-contributory service or
repay any retirement contribution refunds.
When can I keep my health insurance benefits after I retire?
You may continue your health insurance coverage only if you meet the following conditions:
Can the requirements for continuing health insurance coverage be waived?
We have the authority to waive the five-year participation
requirement when it is against equity and good conscience not to allow
an individual to participate in the health insurance program as a
retiree. However, the law says that a persons failure to meet the
five-year requirement must be due to exceptional circumstances. When
someone is retiring voluntarily, a waiver may not be appropriate because
he or she can continue working until the requirement is met. When
circumstances under these conditions otherwise warrant a waiver, we will
notify the individual's employer.
What are the requirements to keep life insurance in retirement?
You can keep your basic life insurance in retirement if all of the following conditions are met:
You can keep your optional life insurance in retirement if all of the
following conditions are met:
Can the requirements for continuing life insurance be waived?
No. We have no authority to waive the requirements for continuing
life insurance coverage. If you are not eligible to continue it, you
will be given the chance to change it to an individual policy.
What should I do about my service?
You should review your Official Personnel Folder (OPF) to make
sure that there is verification of all of your military and civilian
service. If any of the records are missing, your employer should help
you document the service and obtain any missing records.
If you have civilian service for which you must pay retirement
contributions or repay a refund of contributions, your employer should
tell you about what impact payment or non-payment has on your
eligibility and the amount of your retirement benefit.
If you owe a payment to receive credit for military service you
performed after 1956, you must make that payment before you retire. If
you are receiving military retired pay, you should discuss whether or
not you must waive the retired pay with the personnel officer at your
Your personnel officer can also tell you about receiving credit in
your annuity computation for various types of service and about the
payments described above, as well as help you with service
What should I do about Social Security?
You should ask for a form SSA-7004-PC, Request for Earnings
and Benefit Estimate Statement, from your local Social Security
Office or visit their website at
http://www.ssa.gov. If you submit this form, you will get a
statement that provides information on your future eligibility for
Social Security benefits and estimates of these benefits at specified
dates. These estimates do not reflect any reduction for the Government
Pension Offset or the Windfall Elimination Provision (WEP).
What is the Government Pension Offset?
Some of an employees spousal Social Security benefit may be
offset if the employee has a government pension from work not covered by
Social Security. The offset does not apply to the employees own Social
Security benefit, only the benefit that comes from a spouses
employment. If the Government Pension Offset applies, the spousal Social
Security benefit will be reduced by two-thirds of any Federal pension
based on employment not covered by Social Security.
Some employees are exempt from the Government Pension Offset. They
are employees who are automatically covered by the Federal Employees
Retirement System (FERS), Civil Service Retirement System (CSRS) Offset,
and those who elected to transfer to the FERS before January 1, 1988, or
during the belated transfer period which ended June 30, 1988. Employees
who were covered by the CSRS and who elected FERS coverage after June
30, 1988 must have five years of Federal employment covered by Social
Security to be exempt from the offset.
What is the Windfall Elimination Provision?
If you receive a Federal pension and are also eligible for Social
Security benefits based on your own employment record, a different
formula may be used to compute your Social Security benefit. This
formula will result in a lower benefit. The Windfall Elimination
Provision affects workers who reach age 62 or become disabled after 1985
and are first eligible after 1985 for a Federal pension.
The Windfall Elimination Provision does not apply if:
Can I estimate the amount of the Windfall Elimination Provision reduction?
At your request, using the form SSA-7004, the Social Security
Administration will send you a Personal Earnings and Benefits Statement
(PEBES) that will list your earnings from employment covered by Social
Security and provide a Social Security benefit estimate assuming
retirement at alternative ages, 62, 65, and 70.
You should contact your local Social
Security office to determine the effect of the Government Pension
Offset and the Windfall Elimination Provision on your Social Security