For many federal employees, reaching retirement eligibility feels like crossing the finish line. After years of tracking service time and watching the calendar, the day finally arrives when retirement becomes an option.
But becoming eligible to retire and being ready to retire are not always the same thing.
Under FERS, retirement eligibility depends on meeting specific age and service requirements. Whether you qualify under MRA+30, age 60 with 20 years of service, age 62 with at least five years, or another retirement provision, those rules determine when you can retire. They do not necessarily determine when it makes the most financial sense.
For some federal employees, retiring as soon as they become eligible is absolutely the right decision. For others, working one additional year, or even a few additional months, can have a meaningful impact on their retirement income.
That extra time may increase your FERS pension by adding another year of service, accruing more sick and annual leave, and, in some cases, boosting your High-3 average salary. It may allow your Thrift Savings Plan more time to grow while adding another year of contributions and agency matching. Delaying retirement can also increase your future Social Security benefit and provide another year to build cash reserves before paychecks stop.
On the other hand, there are factors that can’t be measured on a spreadsheet. Health, family priorities, job satisfaction, and the desire to enjoy retirement while you’re still able to do the things you love are all valid reasons why someone may choose not to work longer.
The important point is that retirement eligibility should be viewed as the beginning of a decision, not the end of one.
The question isn’t simply, “Can I retire?”
A better question may be, “If I retire now instead of a year from now, how will it affect the retirement I’ll have for the next 20 or 30 years?”
Many federal employees are surprised by how much the answer changes once they look at all of their benefits together.
A Federal Retirement Consultant (FRC®) can help you evaluate how your pension, TSP, Social Security, FEHB coverage, and retirement timing work together so you can make an informed decision about when retirement makes the most sense for you. Schedule your complimentary benefits review today.
