CSRS Retirement NALC Branch 79 Retirement NALC Branch 79

CSRS Eligibility OPTIONAL AGEYEARS

CSRS Eligibility  Disability  Any age5 Years  Deferred5 Years  Disability  Any age5 Years  Deferred5 Years

CSRS Annuity Computations  Basic Components  High 3 Year Salary Average  Length of Creditable Service  Basic Components  High 3 Year Salary Average  Length of Creditable Service

General Formula  1.50% x 40,000 x 5= 3,000  1.75% x 40,000 x 5= 3,500  2.00% x 40,000 x 20 = 16,000  Total = 22,500  1.50% x 40,000 x 5= 3,000  1.75% x 40,000 x 5= 3,500  2.00% x 40,000 x 20 = 16,000  Total = 22,500

Short Cut  Years of Service - 2 x 2  = 28 x 2 = 56%  40,000 x 56% = 22,400  Years of Service - 2 x 2  = 28 x 2 = 56%  40,000 x 56% = 22,400

High 3 Average  The “High 3 Average Pay’ is the largest annual rate resulting from averaging an employee’s rates of basic pay in effect over any period of 3 consecutive years of creditable civilian service, with each rate weighted by the length of time it was in effect.

CSRS - Unused Sick Leave  Unused sick leave is not included for determining eligibility.  Unused Sick leave is added to length of service in computing the annuity benefit.  Unused sick leave is credited only in immediate retirements.  Based on a 2080 hour work year.  Unused sick leave is not included for determining eligibility.  Unused Sick leave is added to length of service in computing the annuity benefit.  Unused sick leave is credited only in immediate retirements.  Based on a 2080 hour work year.

CSRS Unused Sick Leave Example  Actual Service  30 years, 4 months, 16 days  Sick Leave at Retirement  4 months, 24 days  30 Years  4 months, 16 days  4 months, 24 days  30 Years  9 months, 10 days  Total Credit 30 years, 9 months  Actual Service  30 years, 4 months, 16 days  Sick Leave at Retirement  4 months, 24 days  30 Years  4 months, 16 days  4 months, 24 days  30 Years  9 months, 10 days  Total Credit 30 years, 9 months

Maximum Annuity  80% of high 3 based on service.  41 years and 11 months of service earns maximum of 80%.  Unused sick leave is credited in addition to the 80% maximum.  Excess CSRS contributions are refunded to the annuitant.  80% of high 3 based on service.  41 years and 11 months of service earns maximum of 80%.  Unused sick leave is credited in addition to the 80% maximum.  Excess CSRS contributions are refunded to the annuitant.

CSRS Reductions in Basic Annuity  Reduction for Age  Annuity is reduced 2% for each year retiree is under 55, 1/6 percent for each full month under 55  Reduction for Unpaid Deposit  Annuity is reduced by 10% of any unpaid deposit  Reduction to Provide Survivor Benefits  2.5% of first $3,600 of survivor base plus 10% of remainder of survivor base  Reduction for Age  Annuity is reduced 2% for each year retiree is under 55, 1/6 percent for each full month under 55  Reduction for Unpaid Deposit  Annuity is reduced by 10% of any unpaid deposit  Reduction to Provide Survivor Benefits  2.5% of first $3,600 of survivor base plus 10% of remainder of survivor base

Leave Without Pay  Leave Without Pay (LWOP) is fully creditable for retirement purposes for up to 6 months per calendar year.

Survivor Elections  Regular Survivor Benefits  Spouse  Former spouse  Children’s Survivor  Children unmarried and…  Under 18  Under 22, if full time student  Any age, if become disabled before 18  Insurable Interest  Spouse  Former spouse  Insurable Interest  Financially Dependent  Regular Survivor Benefits  Spouse  Former spouse  Children’s Survivor  Children unmarried and…  Under 18  Under 22, if full time student  Any age, if become disabled before 18  Insurable Interest  Spouse  Former spouse  Insurable Interest  Financially Dependent

Types of Survivor Elections  Self only (no survivor benefits)  Partially reduced annuity  Fully reduced annuity  Self only and partially reduced annuity must obtain spousal consent before a notary public.  Fully reduced survivor annuity spouse receives 55%.  Self only (no survivor benefits)  Partially reduced annuity  Fully reduced annuity  Self only and partially reduced annuity must obtain spousal consent before a notary public.  Fully reduced survivor annuity spouse receives 55%.

Military Buyback  Credit for post 56 military service  First employed under CSRS before 10/1/82  Credit for post 56 military service  First employed under CSRS before 10/1/82

Military Buyback continued  Automatically get credit for military service in retirement annuity computation whether make deposit or not.  Make the deposit before retiring - at age 62 then military service stays credited for retirement annuity regardless of social security entitlement.  Deposit not made - no credit for military service if and when become eligible for social security at age 62 or date of retirement, whichever is later.  Automatically get credit for military service in retirement annuity computation whether make deposit or not.  Make the deposit before retiring - at age 62 then military service stays credited for retirement annuity regardless of social security entitlement.  Deposit not made - no credit for military service if and when become eligible for social security at age 62 or date of retirement, whichever is later.

Military Buyback continued Deposit not made  Not eligible for social security benefits at retirement - full credit is granted for post 56 military service in annuity computation.  If later turn age 62 and becomes eligible for social security benefits, annuity will be recomputed eliminating credit for post 56 military service. Deposit not made  Not eligible for social security benefits at retirement - full credit is granted for post 56 military service in annuity computation.  If later turn age 62 and becomes eligible for social security benefits, annuity will be recomputed eliminating credit for post 56 military service.

Military Buyback: computation of deposit  Post 56 deposit - 7% of base pay earned during military service.  2 year interest free grace period. After that, interest is accrued and compounded annually every October.  Make deposit to USPS before retirement.  Post 56 deposit - 7% of base pay earned during military service.  2 year interest free grace period. After that, interest is accrued and compounded annually every October.  Make deposit to USPS before retirement.

Military Buyback: computation of deposit, continued  Request base pay earnings from USPS along with form DD 214.  USPS will calculate deposit due plus interest.  Request base pay earnings from USPS along with form DD 214.  USPS will calculate deposit due plus interest.

Health Benefits  Retires on an immediate annuity.  Insured on date of retirement.  Covered by FEHB under his or her own enrollment or as a family member under another Federal enrollment for 5 years of service immediately preceding retirement.  Retires on an immediate annuity.  Insured on date of retirement.  Covered by FEHB under his or her own enrollment or as a family member under another Federal enrollment for 5 years of service immediately preceding retirement.

Health Benefits continued  Cost - retirees are required to pay same premiums for FEHB as are other Federal employees. Premiums withheld on a monthly basis.  Generally not permitted to enroll in FEHB after retirement.  Survivor benefit must be elected for the spouse to be eligible for health insurance after retiree’s death.  Cost - retirees are required to pay same premiums for FEHB as are other Federal employees. Premiums withheld on a monthly basis.  Generally not permitted to enroll in FEHB after retirement.  Survivor benefit must be elected for the spouse to be eligible for health insurance after retiree’s death.

Life Insurance  Retire on an immediate annuity.  Insured on date of retirement.  Was covered by FEGLI under his or her own enrollment or as a family member under another Federal enrollment for 5 years of service immediately preceding retirement.  Does not convert to a private policy.  Retire on an immediate annuity.  Insured on date of retirement.  Was covered by FEGLI under his or her own enrollment or as a family member under another Federal enrollment for 5 years of service immediately preceding retirement.  Does not convert to a private policy.

Insurance Options  Basic - basic insurance amount (BIA) annual rate of basic pay rounded to next even $1,000 plus $2,000.  75% reduction - 2% per month reduction beginning 2nd month after age 65 down to 25%  50% reduction - same as 75% except reduces down to 50%  No reduction  Basic - basic insurance amount (BIA) annual rate of basic pay rounded to next even $1,000 plus $2,000.  75% reduction - 2% per month reduction beginning 2nd month after age 65 down to 25%  50% reduction - same as 75% except reduces down to 50%  No reduction

Optional Insurance in Retirement A.Standard - will reduce 2% each month until down to 25% starting 2nd month after 65th birthday. B.Additional Full reduction - starts 2nd month after age 65 for 50 months. No reduction - pay full premiums C.Family Full reduction - starts 2nd month after age 65 for 50 months No reduction - pay full premium A.Standard - will reduce 2% each month until down to 25% starting 2nd month after 65th birthday. B.Additional Full reduction - starts 2nd month after age 65 for 50 months. No reduction - pay full premiums C.Family Full reduction - starts 2nd month after age 65 for 50 months No reduction - pay full premium

Thrift Savings Plan Payment Options  Lump sum - receive all.  Single life annuity - equal monthly payments for life.  Single life annuity increasing payment - monthly payments which will increase at at set rate yearly.  Joint & surviving spouse annuity level payment - equal monthly payments for life plus a monthly benefit payable to surviving spouse in event of retiree’s death.  Lump sum - receive all.  Single life annuity - equal monthly payments for life.  Single life annuity increasing payment - monthly payments which will increase at at set rate yearly.  Joint & surviving spouse annuity level payment - equal monthly payments for life plus a monthly benefit payable to surviving spouse in event of retiree’s death.

TSP Payment Options continued  Joint & surviving spouse annuity increasing payment for monthly payments which increase at a set rate yearly plus a monthly benefit payable to the surviving spouse.  Joint & other survivor annuity level payment - equal monthly payment for life plus a monthly benefit payable to a person with an insurable interest or former spouse.  Equal installments over a period of time.  Transfer to IRA or other qualified pension plan.  Joint & surviving spouse annuity increasing payment for monthly payments which increase at a set rate yearly plus a monthly benefit payable to the surviving spouse.  Joint & other survivor annuity level payment - equal monthly payment for life plus a monthly benefit payable to a person with an insurable interest or former spouse.  Equal installments over a period of time.  Transfer to IRA or other qualified pension plan.

TSP Options 1.Leave money in TSP (until 70 1/2), 2.Partial withdrawal - single payment - leave remainder using other 3 withdrawal options, 3.Full withdrawals Receive entire account in single payment Receive entire account in series of monthly payments Purchase a life annuity 1.Leave money in TSP (until 70 1/2), 2.Partial withdrawal - single payment - leave remainder using other 3 withdrawal options, 3.Full withdrawals Receive entire account in single payment Receive entire account in series of monthly payments Purchase a life annuity

Windfall Elimination Social Security Benefits  40 quarters and  30 years of substantial earnings for full social security  Social security determines average indexed monthly earnings (AIME)  Formula is applied to AIME  90% of first $656  32% of AIME in excess of $656 through $3955  15% of AIME over $3955  Windfall elimination reduces 90% to 40%  40 quarters and  30 years of substantial earnings for full social security  Social security determines average indexed monthly earnings (AIME)  Formula is applied to AIME  90% of first $656  32% of AIME in excess of $656 through $3955  15% of AIME over $3955  Windfall elimination reduces 90% to 40%

Government Pension Offset  Receive CSRS pension - $900  Two thirds of pension will be deducted from social security benefit due from deceased wife’s benefit.  Example  Wife deceased benefit $700  Two thirds of pension $600  Deceased wife’s social security benefit $100  $700 - $600 = $100  Receive CSRS pension - $900  Two thirds of pension will be deducted from social security benefit due from deceased wife’s benefit.  Example  Wife deceased benefit $700  Two thirds of pension $600  Deceased wife’s social security benefit $100  $700 - $600 = $100

Miscellaneous  Day of month to retire  Last day of month  First 3 days of month  Taxes withheld at married person with 3 exemptions rate  Part of retirement annuity tax free  Deductions  Survivor annuity  Federal taxes  Health insurance  Life insurance  Day of month to retire  Last day of month  First 3 days of month  Taxes withheld at married person with 3 exemptions rate  Part of retirement annuity tax free  Deductions  Survivor annuity  Federal taxes  Health insurance  Life insurance

RETIREMENT RESOURCES      Shared Services (HR):      Shared Services (HR):

NALC Branch 79