Federal Retirement Age: The Right Time To Retire And Retirement Benefits
Retirement from service or work is one turning point in the life of all employed. Some take this juncture as days of enjoyment, and for some, it turns to be filled with uncertainty. There are people from wealthy circumstances and inherits property and wealth. Some people could make substantial savings in the service period and invest in securities or bank deposits or in the share market. People from this category look forward to an enjoyable retired life with leisure.
There is yet another group who are scared of retirement. For reasons of their own or due to low-income family backgrounds, this category might have failed to make a big saving during service. Their life turns to be worrisome after retirement.
Almost all countries have formulated protective retirement systems in their constitution itself today. Especially in Western and European countries, there are strong systems to take care of the retiring community.
Federal Employees Retirement system
Federal Employees Retirement System, popularly known as FERS, is the retirement protection system prevailing in the US for all its government employees. This system was formulated in the year 1986 to match with CSRS or Civil Service Retirement System, which was there on those days for employees of Private organizations. Federal Employees Retirement System brought in all government employees appointed on or after 1st January 1984. Employees who were appointed before 1984 and continuing as of 31st December 1986 with at least five years in service were given an option to join the FERS.
Minimum Retirement Age
The minimum retirement age for eligible employees is 57 for anyone born in 1970 or later. The lowest retirement age is 56 for workers born in 1963 or 1964 and 55 for workers born before 1948. However, all workers born in 1963 or earlier will have reached the minimum retirement age before 2019. For the employees who born after 1964, two months are added to the MRA for each year through 1970.
Eligibility to join FERS mainly depended upon the employee’s age and the number of years he had put in service with the Government. Age and service period were the two major contributing factors that decided whether one was eligible to benefit FERS. In some situations, the minimum retirement age or MRA was considered the primary criterion for Federal Employee benefits. MRA naturally depended on one’s date of birth. Early retirement benefits were offered to a selected group of people.
In specific situations, if a reduction of the organization’s strength was on the cards, early retirement benefits were offered. In another situation, if someone was declared as permanently disabled, he too was allowed to avail early retirement benefits in the Federal Employees Retirement System. In the usual conditions, to avail benefits of the Federal Employee’s Retirement System, one needs to attain the age of 62 and have served the Government for 30 years.
There are three major components in the Federal Employees Retirement System. One can opt for
(1)Federal Employees Retirement Annuity Scheme
(2) Social Security Plan or
(3) Thrifts Saving Plan.
In the FERS annuity scheme, the benefit of the employee or the annuity is calculated on the period of service one had put into. To determine the annuity in this case, the average of the three highest salaries he had received during his tenure too is taken into account. There are different rules or regulations formulated in the other two options, Social Security and Thrifts Saving Plan.