FERS Annuity Supplement
The FERS annuity supplement is paid in addition to gross monthly Federal Employees
Retirement System (FERS) annuity benefits. It represents what you would
receive for your FERS civilian service from the Social Security Administration
(SSA) and is calculated as if you were eligible to receive SSA benefits on the
day you retired. Eligibility for the annuity supplement continues until
the earlier of:
- The last day of the month before the first month for which you would be
entitled to actual social security benefits, or
- The last day of the month in which you reach age 62.
Eligibility for the Annuity Supplement
If you retire voluntarily on an immediate annuity which is not reduced for
age, you may be eligible for the annuity supplement, in addition to your regular
monthly FERS benefit. You may also receive the supplement if you retired
involuntarily before attaining your Minimum Retirement
Age (MRA) or voluntarily because of a major reorganization, reduction in
force, or an early retirement for Members of Congress. However, in these
three instances, you will not be eligible for the annuity supplement until you
reach your Minimum Retirement Age (MRA). If you receive a deferred benefit,
a disability benefit or an immediate MRA+10 benefit, you will not be eligible
for the annuity supplement.
If your annuity has a Civil Service Retirement System (CSRS) and a Federal
Employees Retirement System (FERS) component, you can still receive an annuity
supplement. However, you must have completed one full calendar year of
service subject to FERS computation rules.
Computation of Annuity Supplement
The FERS annuity supplement is computed as if you were age 62 and fully insured
for a social security benefit when the supplement begins. OPM first estimates
what your full career (40 years) social security benefit would be. Then
we calculate the amount of your civilian service under FERS and reduce the estimated
full career social security benefit accordingly. For example, if your estimated
full career social security benefit would be $1,000 and you had worked 30 years
under FERS, we would divide 30 by 40 (.75) and multiply ($1,000 x .75 = $750).
The result would be your FERS annuity supplement, prior to any reductions.
Changes in the Amount of the Supplement
Like social security benefits, the FERS annuity supplement is subject to an
earnings test. It is reduced if you earn more than the social security
exempt amount of earnings in the immediately preceding year. The supplement
is reduced by $1.00 for every $2.00 of earnings over the minimum level.
It is possible that the supplement could reduce to $0. However, the FERS
basic benefit will not be reduced. If you are receiving a supplement,
you must report your earnings to OPM. You will receive instructions on
how to report your earnings, once you begin receiving the annuity supplement.
Minimum Level of Earnings
The amount you may earn without affecting your FERS annuity supplement is determined
by the Social Security Administration each year. It increases with the
annual increases in average wages for the national workforce.
Definition of Earnings
The FERS basic benefit is not considered earnings when determining your earnings
for the earnings test. Earnings for the year consist of the sum of wages
for service performed in the year, plus all net earnings from self-employment
for the year, minus any net loss from self-employment for the year.