Important Age and Service Milestones for Federal Employees

A list of milestones that feds can use as a guide to make sure they're on track for retirement planning.

Federal employees reach stages of their federal service in which they achieve age and service milestones. The following is a list of these milestones and how they affect an employee’s benefits, both while in service and in retirement.

Months/Years of Service	Age	Milestone
18 months	Any	Eligibility for FERS disability retirement
18 months	Any	Spouse of a deceased FERS employee is eligible for a lump-sum death benefit payment (Basic Employee Death Benefit)
3 years	Any	FERS employee vested in 1 percent of gross pay (SF-50 salary) automatic agency contribution
3 years	Any	Accrue 6 hours of annual leave bi-weekly (10 hours during last pay period)
3 years	Any	Last opportunity to make a deposit for active-duty military service or temporary civilian service without having to pay interest
5 years	Any	Vesting period for CSRS or FERS annuity pension
5 years	Any	Any active-duty military service in which a full deposit is made will be added to existing CSRS or FERS service for the purpose of retirement eligibility and annuity computation. Does not apply to active-duty military retirement unless military retirement pay is waived.
10 years	Minimum Retirement Age (MRA)	“MRA + 10” immediate retirement: MRA is any age between age 55 and 57, depending what year a FERS employee was born. A FERS employee can retire immediately when he or she becomes his or her MRA with a minimum of 10 years of FERS-covered service. Any “MRA+10” retirement FERS annuity pension will be reduced by 5 percent per year for each year the FERS employee is under age 62 when he or she starts receiving the FERS annuity.

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Months/Years of Service	Age	Milestone
10 years	Any	If a FERS-covered married employee who has a minimum of 10 years of federal service were to die while in federal service, then his or her surviving spouse is eligible to receive immediately a monthly survivor annuity equal to 50 percent of the deceased’s accrued pension. This assumes that the deceased employee and surviving spouse were married for at least 9 months while in federal service. Survivor annuity checks will continue for the surviving spouse’s life unless the surviving spouse remarries before age 55.
15 years	Any	Once an employee reaches 15 years of service, the employee will begin accruing 8 hours of annual leave each pay period.
20 years	MRA	“MRA+20”: A FERS employee can retire at age MRA with a minimum 20 years of service. Any “MRA+20 FERS” annuity pension will be reduced by 5 percent per year for each year the FERS employee is under age 60 when he or she starts receiving the FERS annuity.
20 years	50	An employee is eligible to retire immediately under an early retirement arrangement – a VERA or a VSIP offered by his or her agency.
-	35 - 45	FEGLI Basic Insurance Amount extra multiple (2 times before age 35) reduces starting at age 35 to no multiple starting at age 45
-	50	FEGLI Multiple of Salary (Option B) premium cost (paid entirely by employees and retirees) increases dramatically
20 years	50	Special Provision employees if they retire can make penalty-free (no 10 percent early withdrawal penalty) withdrawals from their traditional TSP account


20 (early retirement – CSRS or FERS) and 30 (CSRS/CSRS Offset)	55	Employees who retire (regular or early retirement) can make penalty-free (no 10 percent early withdrawal penalty) withdrawals from their traditional TSP account
20 years	60	An employee is eligible to retired under an immediate and unreduced retirement.
20 years	62	Eligibility to receive a FERS annuity that is computed using an accrual factor of 1.1 percent rather than 1.0 percent.
25 years	Any	An employee is eligible to retire under an early retirement arrangement – a VERA or a VSIP - offered by his or her agency.
30 years	55	A CSRS or CSRS-Offset employee is eligible to retire under an immediate and unreduced retirement.
30 years	MRA	A FERS or a “Trans” FERS employee is eligible to retire under an immediate and unreduced retirement.
-	59.5	Traditional TSP in-service withdrawals are available with no early-withdrawal penalty. Roth TSP withdrawals can be made penalty- and tax-free if it has been at least 5 years since the year of the Roth TSP participant’s first Roth TSP contribution
41 years and 11 months	Any	A CSRS or CSRS Offset employee will maximize his or her CSRS annuity pension. This is because of OPM’s “maximum payable” rule which states the maximum CSRS annuity a retired employee can receive is 80 percent of the retired employee’s high-3 average salary, plus credit for unused sick leave hours. Those employees who work beyond 41 years and 11 months will still contribute 7 percent of their salary into the CSRS Retirement and Disability fund. Those additional contributions will be returned in a lump sum payment shortly after the employee retires.

Months/Years of Service	Age	Milestone
-	62	FERS Special Retirement Supplement annuity (for a FERS employee who retires before age 62) ceases.
--	65	Federal employees (and other individuals) become eligible for Medicare. There is no premium cost for Medicare Part A (Hospital Insurance) for individuals who paid into the system. Medicare Part B (Medical Insurance) and Medicare Part D (Prescription Drug program) are not free.
-	70.5	Qualified Charitable Distributions (QCDs) from IRAs become available to IRA owners
-	70.5	Upon reaching 70.5, a retired federal employee born before July 1,1949 and who owns a TSP account becomes subject to the required minimum distribution (RMD) rules for the TSP.
-	72	Upon reaching age 72 a retired federal employee born between July 1,1949 and December 31,1950 and who owns a TSP account becomes subject to the RMD rules for the TSP.
-	73	Upon reaching age 73, a retired federal employee born between January 1,1951 and December 31,1959 and who owns a TSP account becomes subject to the RMD rules for the TSP.
	75	Upon reaching age 75, a retired federal employee born after December 31,1959 and who owns a TSP account becomes subject to the RMD rules for the TSP.

Edward A. Zurndorfer is a CERTIFIED FINANCIAL PLANNER™ professional, Chartered Life Underwriter, Chartered Financial Consultant, Chartered Federal Employee Benefits Consultant, Certified Employees Benefits Specialist and IRS Enrolled Agent in Silver Spring, MD. Tax planning, Federal employee benefits, retirement and insurance consulting services offered through EZ Accounting and Financial Services, and EZ Federal Benefits Seminars, located at 833 Bromley Street - Suite A, Silver Spring, MD 20902-3019 and telephone number 301-681-1652. Raymond James is not affiliated with and does not endorse the opinions or services of Edward A. Zurndorfer or EZ Accounting and Financial Services. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional.