Do the Math
One-tenth of one percent can make a difference. Workers in the Federal Employees Retirement System have a monetary incentive to stay on the job until at least age 62.
Say you're 61 years old with 25 years of service, and you've made $70,000 a year the past three years.
The standard pension formula is 1 percent times the average of your three years of highest salary multiplied by years of service. Here's how your annual pension would work out.
.01 X 70,000 = 700 X 25 = $17,500
At 62 years old the pension formula grows to 1.1 percent times your high-three.
.011 X 70,000 = 770 X 25 = $19,250
Over 15 years of retirement, that's a $26,250 difference. Human resources specialists report that the difference is influencing employees to put off retirement.
Post a Comment
To post a comment, you must provide a name and a valid e-mail address. Messages must be limited to 400 words. By using this Service you agree not to post material that is obscene, harassing, defamatory, or otherwise objectionable. Although Government Executive does not monitor comments posted to this site (and has no obligation to), it reserves the right to delete, edit, or move any material that it deems to be in violation of this rule.