Figuring out your FERS retirement annuity doesn't have to be a headache.
We'll break it down for you with a few simple and straight examples.
The Basic FERS Annuity Formula
Here's the deal:
- 1% of your high-3 average salary
- Multiplied by your years of service
But wait, there's a twist.
If you're 62 or older with 20+ years of service, that 1% becomes 1.1%.
Sounds small, but it adds up.
What's This High-3 Average Salary?
It's your highest average basic pay over any 3 consecutive years.
Usually, it's your last 3 years, but not always.
Pro tip: Check your entire career. You might find a higher 3-year average earlier on.
Let's Crunch Some Numbers
Time for the fun part. We'll look at three scenarios.
Example 1: Retiring at 57
- Age: 57
- Years of service: 30
- High-3 average salary: $80,000
Calculation: $80,000 x 1% x 30 = $24,000 per year
Monthly annuity: $2,000
Example 2: Retiring at 62
- Age: 62
- Years of service: 25
- High-3 average salary: $90,000
Calculation: $90,000 x 1.1% x 25 = $24,750 per year
Monthly annuity: $2,062.50
Example 3: Retiring at 70
- Age: 70
- Years of service: 35
- High-3 average salary: $100,000
Calculation: $100,000 x 1.1% x 35 = $38,500 per year
Monthly annuity: $3,208.33
Don't Forget These Factors
Your actual annuity might be different. Why?
- Survivor benefits reduce your annuity
- Part-time service affects your total
- Unused sick leave can bump up your years of service
It's not just about the base calculation.
FAQs: Your Burning Questions
Q: Does overtime count in my high-3?
A: Nope, just your basic pay.
Q: Can I get estimates for different retirement dates?
A: Absolutely. Use our FERS Annuity Calculator to play with different scenarios.
Q: What if I have military service?
A: It can count, but you might need to make a deposit. Check out our military service credit article.
The Bottom Line
Calculating your FERS annuity is just step one.
It's part of your bigger retirement picture.
Don't stop here. Look at your TSP, Social Security, and other savings too.
Want a deeper dive? Our FERS retirement guides got you covered.
Remember, knowledge is power. The more you know, the better you can plan.
Your FERS annuity is just the beginning of your retirement story. Make it a good one.