Contributors

Postal Retirement Q&A April 2017 by Roseanne Jefferson

on

Roseanne is a retired USPS employee with an extensive background in USPS retirement, disability retirement, OWCP, EEO, Labor Relations and HR. She conducts individual and group counseling and is able to comprehensively discuss the pros and cons of employees who are on OWCP, disability retirement and regular retirement. Roseanne will be happy to answer your postal retirement questions. Contact Roseanne at roseanne.jefferson@icloud.com. Click here for prior Q&As and Click here for Q&As prior to July 2014.

Good Day Postal Employees!!

You all have kept me VERY busy this month with the emails. Last month’s column generated a lot of questions that are of interest to ALL of you. I had a meeting with a union president this month, (who has traveled throughout the country) and it seems everywhere NOT JUST WHERE YOU ARE!! the “retirement” information is limited to just the TSP.

WELL OK HERE I GO…….If that is all anyone is going to talk to you about is ONE part of your retirement, (OH LET ME GUESS)….it would be THE TSP (right!!!)….they are trying to sell you something…..its called an annuity. If you are a FERS employee you have a 3 part retirement. If someone is telling you that they are doing a “retirement” session, and only talk about 1 part, and I don’t care which part it is….that is just what it is….a PART….OK I’M DONE NOW….Don’t say I didn’t give you all a heads up on that.

Q 1. Hi Roseanne, I have written to you before and I received an annuity estimate and it says I can retire at age 56 with 20 years….I’m interested.

A 1. Hi Interested, You do realize that retiring at age 56 (your MRA) with only 20 years…will make you INELIGIBLE for the Special Supplement, which in your case could be (if no military years in that 20 yr total) is about $650. per month……are you willing to do that….and your annuity is going to be reduced by 30% …..5% for each year under 62…are you willing to do that? That is what an MRA+10 retirement is all about…..reduction. Roseanne

Q 2. My wife is a clerk with 30 years service. She just turned 56 last month which makes her eligible for early retirement under FERS. If she retired now she would be penalized 30%, but at the same time she would get the special supplement at approximately $1000. My question is would the 30% reduction apply just during the 6 years she is drawing the special supplement? At age 62 she would start drawing Social Security and the early retirement would have no bearing on her annuity other than the fact that she only had 30 years service. My next question is about health insurance. I’m a retired letter carrier and I’m covered under my wife’s APWU plan. When she retires it would be in our best interest to go self only in our respective plans. Am I correct in this assessment? I think I saw in one of your articles that’s what you and your husband did. Thank you in advance for all that you do. YOU’RE AWESOME!!!! K.

A 2. Hi K, IF what you say is true and that you wife is 56 right now and has 30 or more years…..that NOT EARLY retirement….that’s FULL retirement, with no 30 percent reduction….start there. And yes, you both can carry individual health plans..as long as you both have single coverage…(one cannot have family). And you are welcome, now lets get her retired!! Roseanne

Q 3. Roseanne could you possible answer this question for me. I am taking a deferred retirement for personal reasons I am not yet minimum retirement age but I do have 25 years of service when looking on the website it says I must keep my retirement contributions to be eligible does this mean the amount that the agency has put in for tsp or does it mean the total tsp including employee contributions, I would like to take a partial withdrawal of my tsp if I can, thank you MG

A 3. HI MG, it means that you do not withdraw your contributions from OPM. You must leave your retirement contributions in the OPM fund, and then when you reach age 60 since you’ve already told me you have more than 20 years of federal service, you should be able to begin to collect your pension from OPM at age 60. You will not be eligible for health benefits or the life insurance but you are eligible for the pension. Roseanne

Q 3a. So what is the Opm fund? I am guessing that is totally different than tsp. I haven’t heard of opm contributions, is that the .08% into tsp or something totally different that I haven’t heard of, sorry I know I am repeating my question but I’m still confused. Thanks again MG

A 3a.MG – Let me start here…..you have a 3 part retirement….FERS, Social Security and TSP. IF you defer, (you are deferring your FERS (portion) of your retirement. You can take your money out of TSP….oh, you’ll pay heavy in taxes..but that is not what I am talking about. I am talking about your contributions to FERS over the years….that figure at the bottom of every pay check, that only changes once a year on PP2. That is the money that is in OPM (Office of Personnel Management) the federal agency that pays federal employees their retirement check. I am saying leave that money in FERS/OPM or there will NOT be a pension check when you reach the age to collect it. Roseanne

3 Response: Thank you, I am guessing they will give me the option on the fers money once my paperwork is being finalized.

ROSEANNE SAYS: NO THEY WILL NOT GIVE YOU AN OPTION!! YOU WILL HAVE TO INITIATE THE PROCESS WHEN YOU TURN THAT AGE. NOR WILL THEY SEND YOU PAPERWORK TO WITHDRAW THE MONEY IF THAT IS YOUR CHOICE. ALL WILL BE UP TO YOU.

MY RESPONSE TO YOU READERS: EVEN as I write this…look at the questions. I keep saying there is a difference in your retirement ….3 separate parts. AND ALL OF YOU confuse them together, or don’t look at them as a separate entity. YOU MUST DO THAT or you will NEVER think you can afford to retire!!

Q 4. Hi Roseanne, Thx for all you do? Need clarification on deferred retirement ? I will have 30 yrs in this May (age52 FERS) if I separate after 30 yrs but before full (age 56) and don’t take retirement contributions, will I receive a pension check at age 56 or 62? And will there be a 5% penalty per year or just high 3 x 1% times years without penalty?
I understand separation means no life no health ins and no supplement. Thx ,EN (the supplement is my carrot, wife has great insurance, house almost paid off, contemplating other work.

A 4. HI – If you leave the agency…and DO NOT take a refund of your retirement contributions….you MUST wait until you reach the year and age that would have “attained” the required years *(and age) to retire…..MRA+30, or age 60 with 20 or more years or age 62 with 5 or more years. And good luck I wish you a wonderful second career if you take the MRA+10…..think about it. Roseanne

Q 5. Hello Roseanne, I just read in one of your more recent Q & A posts that you recommended working right up to the last day of the month you turn 60 if planning on retiring at that age with 20 or more years of service or you won’t qualify for the special supplement. I turn 60 on June 10 and had planned to use annual leave from June 10 through June 30—my official retirement date. I don’t want to make a mistake here. So, will I be O.K. to get the special supplement being on AL the last three weeks of my career? I thought that as long as I was in a pay status that I would be. I have about 24 years with USPS. Thanks in advance for your input on this matter. Sincerely, RK

A 5. Hi RK, As long as you work until the VERY LAST DAY OF THE MONTH IN WHICH MADE YOU FULLY ELIGIBLE…so if you turn 60 on June 10th….YOU MUST not retire before June 30th. AND I mean NOT June 29th!!! No matter what anyone tells you. Your retirement effective HAS to be June 30th to be eligible for the Special Supplement. YES you can use approved annual leave…..using annual leave keeps you on the rolls!!! You don’t have to PHYSICALLY work on the last day, week or month…as long as (in your case) your retirement effective date is June 30th…making you a retiree on July 1. Roseanne

Q 5a.Roseanne: Thank you so much for your quick lightning-like response which relieved my apprehension. I am currently in the process of filling out my retirement paperwork and trying to be thorough and not make any mistakes. I believe that June 30, 2017 is right in the middle of a pay period—that is, I think it is week 1. What should I tell the Postmaster to do about week two—the first week of July when he does TACS. Put me in for 076, non-scheduled or what? Or, will I be off the rolls that quickly? RK

A5a.DO NOTHING….THAT IS THEIR PROBLEM……YOUR LAST DAY IS JUNE 30…DO YOU SEE WHY I AM SO CRAZY….I don’t care what they say…your last day is June 30 PERIOD…. ok I’m done….being crazy…Roseanne

LAST RESPONSE: Roseanne: Thank you for being willing to “crazy” for all of us out here who read and take your very good advice. We all deal with retirement once-but you deal with the same issues over and over. Thank you for being there for people like me. Take care, and thanks…RK

GET READY for QUESTION 6

Q 6. Roseanne, I am a 38 year postal clerk veteran. I have worked most of my career as a part time regular and most recently as a Full time NFTY. I have received an annuity estimate and I have spent hours trying to figure out what type of hours are included in the numerator portion of the proration factor formula. All that I keep reading is that actual work hours are the hours used divided by the number of hours as if I had been full time. I understand the formula but although my 50 is set as a 36 hour regular I have typically worked and average of 50 hours a week for the past several years. How are the hours added up as work hours? Do the 10 hours of overtime count toward my 2080 or/and do the hours stop adding once I reach 40 or 8 on any given day? And are the hours cumulative? Does it go week to week or year to year? If I add up all my hours worked then I have worked at least 2080 for the past several years so do those OT hours count? Also, how do I get that figure? I have tried calling finance and no one seems to be able to help me. One last question, I understand that you cannot make up hours to boost your time to a full time status by using AL and padding your hours however what about the 5 weeks vacation time that I reviewed annually does that go against me? The math is 40 times 52 equals 2080 and if I cannot use AL to pad my hours worked how am I able to use my AL annually and still reach 2080, as a full time or part time employee?GP

A 6. Hi PG,…that is the POINT…you don’t get 40 hours. The pro-ration factor (over time)…reduces the hi-3. When you are calculated…because you are not a full time…you aren’t going to get a “regular” annuity estimate. It has to be ordered. I’m assuming you got one. Go on the back…could be on the front and find the pro-ration percentage….when you find it email me back and we can go from there. Roseanne

Q6a. Roseanne, My proration factor is 75 percent. My question is……what hours make up the “total work hours” for for the formula used. Do all work hours get added including overtime hours and is the total a cumulative. PG

A6a PG, 40 hours….that is the base. You can’t make up the hours!! So…you have to take the calculation and then reduce it by 25%…based on the hi-3 X number of years…then reduce by 25%. Look… I know this is NOT something you want to hear…I just try to give you the facts…& many times it’s not so pretty. This is what happens when you don’t work a full 40 hour work week. Now….understand that estimate is just THAT…an estimate. Just like an estimate with a 40 hour employee that has higher level hours. That’s not on their estimate either. You are NOT calculated on overtime; night D; Sunday Premium…but ARE calculated on any higher level. But that will not happen until after you retire and when Eagan forwards your payroll records to OPM. I hope this helps a bit. Roseanne

Q6b. Roseanne, I understand the whole process in regards to the reduction due to part time status. I am not questioning that. What I want to do is the math itself. I do not want to trust someone else’s math so I want to know what “total work hours” are included in the numerator portion of the equation and if the hours are cumulative for the total number of years worked. Who do I speak to to get those total hours?

A 6b. PG, you could begin the process by contacting someone in your District Finance office. Not sure how well that may work. In all reality- for you to get this info…because it is MUCH….you may need to have your union represent this to Management as a request or a grievance. AND IF…you are CSRS versus FERS…another layer of knowledge that is lacking on this type of issue. To begin the process….tell me (on your pay stub) what is your retirement code. It’s in the small box with retirement…its either 1; 8; A; 5 Roseanne

Q 6c. Roseanne, The number is a 1 in my retirement box. I did contact accounting and they have given me a ticket number and told me that someone will contact my by Tuesday. In all honesty, I cannot imagine why this is so difficult. I know I am not the first CSRS part time employee to retire and every time I speak to someone they behave like it is an impossible task. I am assuming that HRSS must have used a specific number in my formula yet they will not divulge that info to me. I’m thinking they just used my 50. This process is so important to me. I am only 59 years old and I want my annuity to be correct. Thank you for taking me seriously, PG

Q 7. Roseanne, do you have any information relative to retirement…BT

A 7. dropping the mic…….🎤…..

Till we speak again…..Roseanne

Recommended for you