Withdrawal Options
What should you do with the money in your TSP account when you retire  (03/23/06)

OPM director pushes part-time work in lieu of retirement
Federal employees should be able to work fewer hours in their later career, staving off full retirement, the Office of Personnel Management chief said Monday. As part of her agency's commitment to expanding part-time work arrangements, Springer cited a legislative proposal offered in the fiscal 2007 budget, which would remove a penalty to employees in the Civil Service Retirement System for working part-time  (03/15/06)

Proposal would remove penalties on annuities for Part-Time Positions  

The proposed Federal Retirement Improvement Act includes language to remove penalties on annuities when employees in the Civil Service Retirement System move to part-time positions at the end of their careers, Office of Personnel Management officials said.  (02/13/06)

See "A Risk in Going Part-Time"

Bush seeks upgrade of retirement benefits processing
President Bush proposed an additional $26.7 million this week to modernize the federal retirement system, with a goal of authorizing requests for new retirement benefits within five days and achieving at least 95 percent accuracy in payments. The money will be used to "greatly improve the speed and accuracy of federal retiree benefit payments," according to Bush's 2007 budget, unveiled Monday. Many federal retirees find it takes months until they receive an accurate annuity payment after they retire. A modernized system will allow the government to tabulate benefits for new retirees in five days or less, OPM said. The system also will improve accuracy of the claims from 90 percent to 93 percent in the older Civil Services Retirement System and from 95 percent to 97 percent in the Federal Employee Retirement System.  (02/12/06)
 

APWU Vice President: Discontinued Service Retirement Is an Option for the Disrupted
In light of management’s determination to disrupt the lives of thousands of postal employees with its plans for “network consolidations,” it is time for workers to examine all the options, including one that is not well known: Discontinued Service Retirement. see more from OPM (PDF) (01/06/06)
 

Terms of Disability Retirement
It’s a funny (not ha-ha) thing. The federal government doesn’t have a short-term disability program. It has untidily filled in the gap with sick leave and annual leave (both your own and donated). On the other hand, the government does have a first-rate program for those employees with a disabling mental or physical condition that makes it impossible for them to continue in their current job. If their condition is expected to last for at least one year, these employees can apply for disability retirement. Periodic medical evaluations will be required until age 60 unless the disability is determined to be permanent.  (01/01/06)

Wake-Up Call for CSRS Retirees
Tis the season to retire for many employees. If you are one of them and are covered by CSRS, you need a wake-up call. There are two provisions of law that can reduce your retirement income. While they won't affect your CSRS annuity, they may reduce – or even eliminate – certain Social Security benefits to which you may otherwise be entitled. The "bad news bears" are the Windfall Elimination Provision and the Government Pension Offset. (01/01/06)

KATRINA VER INFORMATION - December 13, 2005

Ask President Burrus
Question: Why are retirement annuities calculated using the “high-three” formula? Do you think the formula will ever be reduced to “high-two,” “high one,” or perhaps just the final year of employment? Question: Why does the pay-for-performance program apply only to EAS personnel? Shouldn’t the rank-and-file, many of whom make their supervisors look good, share in the wealth? (12/12/05)

The FERS Special Retirement Supplement
The special annuity supplement is a benefit paid to certain FERS employees who retire before age 62 and are entitled to an immediate annuity. The SRS approximates the Social Security benefit earned while covered by FERS, and is designed to bridge the gap between retirement and age 62, when a retiree first becomes eligible for Social Security. (12/02/05)
 

Some Retirees Are Overpaying For Health Care
Most retirees stay in the same health plan year-after-year. That's because they are confused by the choices they have or don't understand the process. People who do nothing during the open season, which is the majority federal retirees, are automatically continued in the same plan next year that they are in this year. That's okay in some cases, but with premiums jumping in some of the most popular-to-retiree plans, former feds need to shop around.  (11/22/05)

The Alternative Form of Annuity

Did you know that there's a thing called the Alternative Form of Annuity? The AFA once meant a great deal to those retirees who were able to take advantage of it before things took a turn for the worse. When the FERS law was passed, a provision was included that allowed retirees to elect to take their retirement contributions in a lump sum and have their annuities actuarially reduced. The refunded contributions would be tax free because they were made up of dollars that had already been taxed. The annuities would be 100 percent taxable. (11/20/05)

OPM moves to fix pension check problems
The Office of Personnel Management plans to award three technology contracts it says will speed up the processing of annuity checks for retiring federal employees. Employees today must wait up to six months or longer after retiring before they receive their full monthly annuity payments. This is because it takes that long for OPM to compile and review personnel records and calculate a retiree’s annuity. Until OPM determines the correct amount, it typically withholds between 15 percent and 35 percent of an employee’s projected monthly pension. (11/20/05)

USPS Could Save $250 Million Under New Medicare Act - The U.S. Postal Service hopes to implement a Medicare-eligible retiree prescription drug subsidy established by the Medicare Modernization Act of 2003 that could save the agency $250 million each year. Richard J. Strasser Jr., chief financial officer and executive vice president of the USPS, announced the idea of using the subsidy at yesterday’s MTAC meeting. Under the act, employers -- including the federal government -- who offer qualified prescription drug coverage are eligible to receive the subsidy. The act takes effect Jan. 1. "We have 330,000 retirees eligible for this," Strasser said. "We, and you through your rates, are paying for this benefit for prescription drugs for our retirees, and there is a subsidy that enables us to return some of that." However, the Office of Personnel Management -- which oversees the Federal Employees Heath Benefit Program of which the USPS is a participant -- does not expect to apply for the subsidy for the program. "We are going to need the cooperation of [the OPM] since they administer this plan, in order for us to apply and get that quarter of a billion dollar rebate," Strasser said. (11/03/05)

Costly Confusion -In August 2003, Energy Department employee Mike Jacobs received some unwanted news. While attending a retirement seminar sponsored by his department, he learned that, due to a technical problem, he had been placed in the wrong retirement system. Jacobs isn't the only one. When the government switched from the Civil Service Retirement System to the Federal Employees Retirement System in 1987, thousands of employees were mistakenly and unknowingly placed into the new system without their consent. Employees in CSRS were supposed to have been given a choice between staying in the old system or moving to the new. The glitch mostly affected employees who had worked under the old system, left government and later returned to the public sector, and employees who had experienced changes in appointment types or who had worked in excepted service agencies and then moved to the standard personnel system. Upon their return to the standard personnel system, those employees also could have been eligible to be placed in a third system called CSRS Offset, which combines CSRS with some Social Security benefits. (10/28/05)

Retiring early may actually hurt health, Shell research finds - Early retirement doesn't help workers live longer, and it may even shorten one's life, according to a study published Friday by the British Medical Journal. The life expectancy of employees who retired at 55 was significantly reduced compared with those who retired at the age of 65, said Shan Tsai of Shell Health Services in Houston, who studied more than 3,500 former workers at Royal Dutch Shell Plc between January 1973 and December 2003. There is a widespread perception that early retirement, associated with a more relaxed lifestyle and less pressure, leads to a longer life expectancy. Tsai's findings question this theory. Some other researchers who have studied the issue have suggested that early retirement harms health because the workers are already ill before they retire or because of the change-of-life events. "Although some workers retired at 55 because of failing health, these results clearly show that early retirement is not associated with increased survival," Tsai said in the study. "On the contrary, mortality improved with increasing age at retirement for people from both high and low socioeconomic groups." (10/23/05)

Retirees to get 4.1 percent cost-of-living adjustment
Federal retirees under the Civil Service Retirement System will receive a 4.1 percent boost to their pensions in 2006, the largest hike in 14 years. (10/14/05)

Retirement Considerations -Are you considering retirement? If so, please review and consider 10 of the most commonly made retirement mistakes: Retiring on the spur of the moment because of a difficult assignment or personality clash on the job. Many APWU members will recall how postal workers jumped at the offer of early retirement in 1992, only to realize later that it was not necessarily the wisest decision. (9/25/05)

GOP Group Calls for Cuts in Federal Retirees' Benefits to Fund Katrina Relief -A group of Republican House members called Wednesday for cuts to some federal retirees' benefits to help offset the cost of Hurricane Katrina recovery. The House Republican Study Committee released a package of recommendations known as "Operation Offset" Wednesday that called for calculating retirement annuities for federal employees based on an average of their five highest-earning years of service instead of three. Adding two years of lower pay would tend to decrease the average, and thus reduce retirees' defined benefits. see text of proposal [gif] (9/22/05)

Buying Back Military Time -Getting credit for active duty service in the military used to be a simple thing. It still is for anyone whose service was performed before January 1, 1957. If you are one of them, you’d get credit for that time in your annuity computation without paying a deposit. Everybody else with military service has to wrestle with the matter. This being the federal government, there are two sets of rules that govern whether you are required to make a deposit in order to get credit for your period(s) or military service. (8/31/05)

 Study fine print of optional dental/vision plans

Mike Causey - This time next year, feds hope to have something new to smile about. The Office of Personnel Management, which oversees the government's health and retirement programs, is expecting several companies to bid on providing optional dental/vision packages to federal and postal workers and retired civil servants (8/23/05)

Rumor: the Postal Service is looking to make some changes in the way it handles individual retirement counseling for employees. (8/22/05)

Lawmakers Push for Solution to Delays in Full Pension Payments - Some retirees have reported waiting several months for OPM to tally up the correct amount for their monthly checks and have questioned why. When an employee retires, OPM provides an interim payment designed to avoid overpaying a retiree until the final pension calculation. Most employees get an accurate pension payment within 75 to 90 days, but some wait for months if they have complicated work histories or worked at several agencies. Once OPM calculates the correct annuity, it sends a lump-sum payment to cover the months when the retiree got a "haircut," as the new OPM director, Linda M. Springer , put it at a July management conference in Washington.  (8/08/05)

Social Security quirk slams some retirees -Workers whose employers opted out of Social Security coverage are losing benefits they thought they had coming. (6/26/05)

Best Date to Retire in 2005-  Tammy Flanagan, Senior Benefits Director, NITP, Inc.-Choosing a good retirement date involves some homework that must begin long before you complete your CSRS or FERS retirement application. Consider attending a pre-retirement planning seminar to get assistance with the financial planning, tax issues, and planning for a life after retirement (include your spouse or significant other in this discussion if you have one)! If this is the year you have decided to begin your retirement from federal service, then this article is for you! If you like it simple and short, then here it is: The best date to retire in 2005 is Tuesday, January 3, 2006 for CSRS (and CSRS Offset) or Saturday, December 31, 2005 for FERS (and transFERS) First of all, here are some things to consider when you are choosing your retirement date this year - or any year.(5/26/05)

House committee votes to add employee, retiree benefits
The House Government Reform Committee approved three bills Tuesday benefiting federal workers and retirees, although the measures are unlikely to become law in the near future.
One of the most contentious bills would allow federal retirees to pay their health insurance premiums with pretax dollars--a practice known as "premium conversion." The bill (H.R. 994), introduced by Chairman Tom Davis, R-Va., and co-sponsored by Rep. Jon Porter, R-Nev., also moved through the committee smoothly last year, but was eventually blocked by House Ways and Means Committee Chairman Bill Thomas, R-Calif. (5/18/05)

Congress not sweating retirement-President Bush shook up the debate about reforming Social Security last month with a suggestion to cut benefits for middle- and high-income earners while leaving low-wage earners' benefits alone. Now congressional Republicans are putting together a bill supporting his ideas. We need to keep in mind that though they may be politically invested in this reform, few, if any, elected officials are personally invested. That's because many are so wealthy, they and their families won't ever depend on Social Security. (5/9/05)

A Diet Social Security Check

When you retire, and Social Security finds out that you are fed under the CSRS program, odds are your benefit will be reduced, and any Social Security spousal or survivor benefit you expected will be eliminated. That's because of the "windfall" and "offset" formulas Congress has applied to the Social Security benefits of feds (teachers, cops, and others) who have their own retirement system, but didn't spend a full career (like 30 years) paying in to Social Security.

In most cases, feds can qualify for Social Security benefits after paying into the program for 40 quarters, or ten years. This is for Social Security covered work before or after they joined Uncle Sam, or in some cases a second job they had while working for the federal government.

But when the "windfall" formula kicks in, and it will if you are under CSRS, it can trim your estimated Social Security benefit by as much as $300 a month. If the "offset" formula, which applies to CSRS retirees entitled to their spouses' Social Security, is applied to that benefit, the benefit is usually wiped out - Mike Causey (5/5/05)

Age-bias law excludes some jobs that involve public safety (source: Newsday)

Q. In a previous column you said it was illegal for a company to force someone into retirement because of the federal Age Discrimination in Employment Act. Can you tell me how long this act has been in existence? I am a former U.S. postal inspector and faced mandatory retirement at age 55 in 1983. Your column has aroused my curiosity as to whether I might be eligible for retroactive benefits.

A. Unfortunately, between your occupation and the statutes of limitations, you probably fall outside the protections of the ADEA, which was enacted in 1967.

As a rule, employment decisions cannot legally be made on the basis of age, but certain public occupations are excluded for public safety reasons, said New York employment-rights attorney Alan Sklover, author of "Sklover's Guide to Job Security: The 7 Steps to Staying Employed and Employable" (self-published, $39.95). Those exclusions affect firefighters, airline pilots and law-enforcement officers who carry firearms.

"We all recognize that certain aspects of health, such as muscular strength, agility and eyesight, do tend to affect almost everyone's abilities during later years," Sklover said. "And that might pose a danger to the public in certain occupations." And your status as a postal inspector, especially if you carried a gun, "may put you in this category," Sklover said.

Even if the law had protected you, the statutes of limitations have expired. If you have an age discrimination complaint, you must contact the U.S. Equal Employment Opportunity Commission within 180 days, or 300 days if the complaint is also covered by a state or local anti-discrimination law. "That makes you about 21 years too late," Sklover said. (5/1/05)

Most people aren’t saving enough for retirement, report says-Sliding into what poet Henry Wadsworth Longfellow dubbed “the evening twilight” of life, Harold Plummer admits he is feeling pretty confident. The Norfolk resident retired a year ago in February after 39 years with the U.S. Postal Service, with a full federal civil service pension plus his own personal investments. "Most people say they live month-to-month, and their attitude is 'I'm getting by now, why not then?'" said Craig Copeland, a researcher for the Employee Benefit Research Institute. "And many workers also still think they have time, which may not be correct.". Planning tips for retirement: How much do you need to save for your retirement? It depends. The goal, experts say, is to generate enough income, through pensions, savings, investments, Social Security and even work, to cover costs. Individuals must determine how they want to live and figure the costs, and then calculate whether their revenue streams will cover that. (4/22/05)

Experts list several tips for preparing for a financially secure retirement:

- Study your Social Security benefit statement when it arrives in the mail. Pay attention to the age at which you will be eligible for full benefits and the projected benefit amount.

- Visit the Social Security Administration’s planning Web site (http://www.ssa.gov/retire2/) , which has calculators and other resources.

- Prepare a realistic, post-retirement budget of income and expenses. Update it as needed based on changing lifestyle.

- Make a plausible estimate of how long you might live, based upon family history and personal health. Update as needed.

- Using your budget and life expectancy, try to estimate how much you need to be saving to arrive at a figure that will last throughout your retirement.

- Structure retirement savings to provide cash flow and liquidity as necessary, while keeping some assets in longer-term investment products.

- Sign up for your 401(k) savings plan at work for automatic payroll deductions, or open an individual retirement account (IRA) and have your bank shift money automatically every payday. Or do both.

- Increase the percentage of income being contributed to your retirement account every time you get a raise.

- Think about health and health-care costs in all savings decisions.

- Don’t decide to retire until you have a plan.

FERS offers employees the best retirement benefits-The Federal Employees Retirement System (FERS) program is the best retirement system created thus far. Certainly, one can appreciate the benefits of the Civil Service Retirement System (CSRS) and CSRS-Offset, but never before has our government or corporate America provided employees the opportunity to amass such a level of retirement savings. With FERS pensions, advanced Social Security benefits via the supplemental annuity and the Thrift Savings Plan (TSP), it is no wonder pending federal retirees are excited about their retirement future. This undervalued plan has provided a solid and equitable means for federal employees to maximize their retirement savings and supplement TSP contributions. Unfortunately, amid speculation and skepticism, many under CSRS and CSRS-Offset chose not to transfer to the FERS program when they had the opportunity in 1998. (4/9/05)
 

Retirees Getting Snared in Credit-Card Bind- Clara and Charles Unruh have lived in their Philadelphia home for nearly 50 years. And now they could lose it. They were so heavily in debt after they retired that they were forced to put their home up for collateral in what's known as a reverse mortgage. A lot of seniors in this country are living primarily on Social Security," said Tamara Draut, co-author of the study. "When they're on fixed incomes and they see something like health-care costs rise, they have credit cards. They really are turning into a private safety net." (4/9/05)

CSRS enrollment is declining but not disappearing-Since the Civil Service Retirement System began being phased out in the mid-1980s, the number of active-duty government workers enrolled in it has dropped to about 742,000, fueling speculation about its viability. (4/5/05)

Windfall Elimination Provision could affect you -Are you entitled to receive pension benefits from a job in which you pay no Social Security taxes, such as work for the federal government under the Civil Service Retirement System, your state government or for an employer in another country? Yet you’ve also worked part-time or gone into a second career where you paid Social Security taxes and will some day be eligible for benefits? Then those Social Security benefits (including disability benefits) might be smaller than you anticipate because of what’s called the Windfall Elimination Provision (2/14/05)

Best Date to Retire in 2005-It is that time again. It is time to review the rules for choosing a good CSRS or FERS retirement date for this year and time to figure out the "best" date to take advantage of tax breaks, lump sum payments, and computation of retirement benefits. Choosing a good retirement date involves some homework that must begin long before you complete your CSRS or FERS retirement application. Consider attending a pre-retirement planning seminar to get assistance with the financial planning, tax issues, and planning for a life after retirement (include your spouse or significant other in this discussion if you have one)! If this is the year you have decided to begin your retirement from federal service, then this article is for you! (2/14/05)

 A Risk in Going Part-Time by APWU Retirees Director John Smith-“What is the Part-Time Pro-ration Factor?” This continues to be the most-asked-about and talked-about subject in our retirement seminars. It is important that every member who is considering changing to part-time work late in a career be familiar with the following... (2/7/05)