”Hi, I’m 61 years old and my FERS supplement is ending soon. What should I do when that income goes away? And how am I going to supplement that income that’s normally there?
Thanks.”
The Federal Employees Retirement System (FERS) Supplement, also called the Special Retirement Supplement (SRS), is an extra payment for some federal workers who retire before age 62. This supplement helps replace Social Security income until they can claim Social Security benefits1. Let’s explore who can get the supplement, how it works, and what to do when it stops.
Who Can Get the FERS Supplement?
To get the FERS Supplement under a normal FERS career, you must meet one of these requirements:
- Retire at your Minimum Retirement Age (MRA) with at least 30 years of service
- Retire at age 60 with at least 20 years of service
Your MRA depends on when you were born and is between 55 and 57 years old
How Much is the FERS Supplement?
The amount of your FERS Supplement depends on your estimated Social Security benefit and how many years you worked under FERS. It is calculated using a formula based on your years of service and projected Social Security earnings. That formula is:
Years of Creditable Service / 40 X Age 62 Social Security Benefit
What Happens When the FERS Supplement Ends?
The FERS Supplement stops when you turn 62. It’s important to plan how you’ll replace that income. Here are two common options:
Claiming Social Security at Age 62
Using Your Thrift Savings Plan (TSP) or Other Savings
If you start Social Security at 62, your monthly benefit will be less than if you wait until full retirement age. If you use your TSP or other savings, you can let your Social Security benefit grow.
Planning Ahead
Before the FERS Supplement ends, it’s important to plan ahead:
- Decide whether to claim Social Security early or wait for a larger benefit
- Think about using TSP withdrawals or other savings to cover the gap
- Talk to a financial advisor to create a retirement income plan
Remember, the FERS Supplement is a helpful benefit, but it only lasts until age 62. Planning for when it ends can help ensure a smooth transition in your retirement income.
ABOUT THE AUTHOR
Micah Shilanski, CFP®, is a distinguished financial planner known for his deep commitment to providing exceptional advisory services to his clients. As the founder of Plan Your Federal Retirement, Micah has dedicated his career to helping federal employees understand and optimize their benefits to ensure a secure and prosperous retirement. His expertise is widely recognized in the industry, making him a sought-after speaker and educator on financial planning and retirement strategies.
Micah’s approach is client-centered, focusing on creating personalized strategies that address each individual’s unique needs. His work emphasizes the importance of comprehensive planning, incorporating aspects of tax strategy, investment management, and risk assessment to guide clients toward achieving their financial goals.