Early Retirement

• Early Optional Retirement
• Discontinued Service Retirement Because of an Involuntary Separation
• Eligibility for Early Optional / Discontinued Service Retirement Because of Involuntary Separation
• Annuity Computation

Early Optional Retirement

If your agency undergoes a major reorganization, reduction in force, or transfer of function, and a significant percentage of the employees will be separated, or will be reduced in pay, the head of your agency can ask the U.S. Office of Personnel Management (OPM) to permit early optional retirement for eligible employees.

If your agency gets approval to permit early optional retirements, eligible employees will be notified
of the opportunity to retire voluntarily.

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Discontinued Service Retirement Because of an Involuntary Separation

The term “involuntary separation” means any separation against the will and without the consent of the employee, other than “for cause” for misconduct or delinquency.  The most common cause of an involuntary separation is a reduction in force.  Another frequent cause for an involuntary separation is when the location of an office or unit is moved to an area outside the commuting area of the old worksite*.  Employees who decline reasonable offers of other positions are not eligible for discontinued service annuities.

*Exception:  If, when you accepted your current position, you were placed under a general mobility agreement whereby you would be subject to geographic reassignment, you would not be eligible for discontinued service annuity rights if your position is moved to an area outside the commuting area.

If your agency-

• makes you a reasonable offer and you choose to decline the offer and resign, you will not qualify for discontinued service retirement, or
• separates you by adverse action procedures for not complying with a directed reassignment to a position that is a “reasonable offer”

your separation would not be qualifying for discontinued service.

Reasonable Offer

• Written offer of another position in your agency and commuting area for which you are qualified, and
• Which is no more than two grades or pay levels below your current grade or pay level.

Commuting Area

Geographic area that usually constitutes one area for employment purposes. It includes any population center (or two or more neighboring ones) and the surrounding localities in which people live and reasonably can be expected to travel back and forth daily in their usual employment.

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Eligibility Requirements for Early Optional Retirement and Discontinued Service Retirement Because of an Involuntary Separation

CSRS Annuity Formula
Age	Years of Service
Any	25

At least 5 years of your service must be civilian service, and you must have been employed under the Civil Service Retirement System for at least 1 year out of the last 2 years preceding retirement.

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Annuity Computation

Here is how the CSRS annuity formula is calculated:

CSRS Annuity Formula
Years of Service	What You Receive
First 5 years of service	1.5 percent of your high-3 average salary for each year
Second 5 years of service	Plus 1.75 percent of your high-3 average salary for each year
For all years of service over 10	Plus 2 percent of your high-3 average salary for each year.

 

Reductions in Annuity

Your annuity will be reduced if:

• You retire before age 55 (unless you retire for disability or under the special provisions for law enforcement officers, air traffic controllers, and firefighters).  Your annuity will be reduced by one-sixth of 1 percent for each full month (2 percent a year) you are under age 55.
• You didn’t make a deposit for service performed prior to October 1, 1982, during which no deductions were taken from your pay (non-deduction service after that date is not used in the computation of benefits if the deposit is not paid);
• You didn’t make a redeposit of a refund for a period of service that ended before October 1, 1990;
• You provide for a survivor. 
  • To provide a full survivor benefit for your current or former spouse, your annuity will be reduced by 2.5 percent of the first $3,600, plus 10 percent of the annuity over $3,600.
  • To provide a survivor annuity for a person who has an “insurable interest” in you, your annuity would be reduced from 10 to 40 percent, depending on the difference in your age and the age of the person named.