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Information on this page is provided by Roseanne Jefferson.
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@yahoo.com. |
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Postal Retirement
Q&A September 2012 |
Good Day Postal Employees:
It has been an extremely HOT
summer and as always I give a sincere
SHOUT OUT to all the carriers who have
braved the heat these past few months.
Our carriers are simply amazing...
And the hits just keep on
coming....Another round of VERA's for
EAS employees..ahh but with NO
INCENTIVE. Now I wonder,...who keeps
saying that over and over again, yes
to more VERA's but not feelin' any
incentive money with the VERA)???
Q 1. I am 45 with 17 years
postal and 4 years military. Can I
retire now and receive an annuity at
my MRA? Would it be a retirement
request or resignation? Trying to
figure my options if something comes
up to leave this place. R
A. 1
-Hi R, In a word...no. If you paid
back your military, (prior to
resignation) that would give you 21
years at age 60 or 62. If you
resigned, you could receive "Postponed
Annuity Benefits". Let me quote FERS
information on Postponed Annuity
Benefits: "Separating employees can
reduce or eliminate the age reduction
by postponing the commencing date of
the MRA +10 annuity. A former employee
eligible for an immediate MRA +10 may
elect a postponed retirement benefit
at any time after he or she separates
from Federal Service. (A former
employee who has not begun to
receiving a postponed MRA +10 annuity
may still elect to receive his annuity
retroactively to the first of the
month following separation from his or
her last period of Federal
employment.)"
Annuity Reduction
for Age: The postponed annuity is
reduced by 5/12ths of 1% for each full
month (5% per year) by the which is
chosen commencing date precedes the
employee's 62nd birthday. There is not
age reduction if the annuity
commencing date is less than 1 full
month before the employee reaches age
62.
Age 60 w/20 Years of
Service: If the employee has complete
20 years of creditable service, there
is no age reduction if the annuity is
postponed to age 60."....Roseanne
Q 2. - Hello Roseanne, I am
struggling to understand how best to
take care of me. I am new to your
columns on Postalmag but found your
January, 2011, column regarding the
USPS Retirement field on pay stubs
most interesting. What hazards must I
be aware of if I withdraw this money?
Where can I learn the truth?
I
have a balance of close to $8,000 in
the USPS Retirement field, could I use
this money to buy some "time" to
become eligible for an annuity or is
it best just to withdraw the monies?
I began with the Postal Service in
1982 before FERS in a non-career
Postal position. My contract(s) were
directly with the USPS. I became a
"permanent" USPS employee in April of
'84 and left the service In Oct. 2005.
What must I do to qualify for an
annuity? I am now 56 yrs old. I have
no military service. I did not meet
the requirements to attend a USPS
sponsored retirement seminar before
separating from the USPS.
A 2.-
I guess I should start out by
explaining that the retirement money,
(which is totaled at the bottom of
your pay stub) is IN the FERS
RETIREMENT FUND AT OPM. You CANNOT
withdraw your retirement funds UNLESS
you resign. As far as where you can
learn the truth, seems like you
"found" me! Again, this money is only
"available" two ways:
1. you
resign and you request your retirement
funds from OPM **
2. you
retire...BUT that money is NOT
refunded. It has a matching component
that the post office contributed (the
same amount as is listed as your total
contributions. Although not very much,
even at retirement, that money cannot
be withdrawn if you retire, as you
would be receiving a monthly annuity.
** Just to be clear....if you were to
resign, and request a refund of your
retirement contributions, ONLY THE
PORTION YOU PAID is refunded, not the
matching funds that the post office
contributed.
Based upon the
information you provided, that you
became a career employee 1984 (FERS),
and resignation 2005 (w/21.6 years),
and are now 56 (I suspect YOUR MRA.) I
will make the assumption that you
either resigned or were fired, matters
not either way...what matters is when
can you get your money, and how to get
it. First, if you apply to withdraw
your retirement funds, you WILL NOT BE
ELIGIBLE to collect an annuity. Your
eligibility begins at age 60. You will
be able to collect an annuity, when
you turn 62 (FERS retirement
regulations).
Your idea about
withdrawing the money to "buy some
time" until you become eligible for
retirement would cancel your ability
to have a monthly annuity. I am not
sure what your High 3 average salary
was in 2005, but I do know that the
20+ years you have invested, would net
you 1% of your high 3 average salary
times 20, then divided by 12. Meaning,
YOU DON'T WANT TO PULL OUT THAT 8
GRAND, BECAUSE although it's only 8G,
your annuity is worth FAR MORE than
8G. Let me give you an example. Let's
say your high 3 average salary was
50,000, your monthly annuity would be
$833.00 gross per month FOR LIFE.....
so why would you do that??? This is
why no one tells people the
truth...they let you think you can
take out this retirement money, (and
of course you can), but by doing
that....NO RETIREMENT annuity would be
available. And to address your
concerns about not being able to
attend any retirement seminars, that
is pretty typical all around the
country. And really, it probably would
not have mattered. In 2005, how we
communicated personnel related
information changed dramatically. We
revamped orientation, and there was no
real push in the any of the HR
District Offices, to conduct seminars
or training on retirement, benefits
etc. It was expected that all postal
employees would read the booklets and
pamphlets given to them at
orientation, and all letter
communication, sent from HQ. By the
time you get to an age where
retirement is in reach...most FERS
employees have pissed away their REAL
RETIREMENT MONEY (TSP) by not
contributing enough to "force" the
post office to match their funds in
TSP.
Sincerely, I hope this has
enlightened you and at least given you
the information so that you don't make
a huge mistake by requesting a
refund.....pssst! "that is what they
want you to do".. Think about
it...give you 8G, or pay you 833.00 a
month for the rest of your
life...which one do you think they
would rather you do??? Roseanne
Q 3.-Roseanne, I am considering
retiring 12/30/12. My RCD , service
creditable for retirement eligibility
dates as of 5/08/1975, however my ACD,
service creditable for annuity
retirement dates as of 3/17/1978. I
requested and received from OPM a
balance due of just over 9,000. owed
for non deduction service, performed
prior to 10/1/1982. Do I understand
correctly that my annuity will be
reduced annually by 10% of that
balance due? And if I paid the deposit
would it change the amount of the
annuity back to the earlier date of
5/08/1975? I suppose the difference
between the RCD and ACD is that as a
substitute rural carrier I did not
work full time and thus my annuity is
pro rated only from 3/17/1978. Thank
you for any insight you can give me
into this issue. JE
A 3.- _Hi
JE, I know paying it back this late in
the game is really difficult..so much
money in just interest!! I will assume
(just by the years) that you are CSRS,
and so this information is for a CSRS
employee...not CSRS/offset. If you are
a code 1, you are CSRS, if you are a
code 5 you are CSRS/offset. It would
be much better if you identified that
for me, so I can give you more
accurate information. Roseanne
Q 3. Follow-up: Roseanne, Thank you so
much for a reply to my question
regarding paying a CSRS deposit I owe.
But for work I did in the private
sector in the 1970s, and part time
work I had a few years ago outside of
the Postal Service I am a Rural letter
carrier hired on a regular basis
listed from 1981. The unfunded periods
I can pay CSRS deposit on are from non
funded rural letter carrier work I did
from periods between between 7/1975 to
01/1981. I did have some funded
periods to CSRS in the 1970s as a part
time seasonal employee of the IRS. As
I have no deductions on my Federal pay
stub I assume I am not CSRS offset
though I do have the required amount
of periods paying into SSI to receive
a minimal SSI annuity at age 62. Am i
correct in assuming that CSRS offset
on applies to employment begun after
1984? Thanks again for your advice on
my situation as it is very difficult
to contact or get answers from HRSSC
or OPM. JE
A 3. Follow-up
Answer: Hi JE, First, look on your pay
stub in the "retirement box" and if
the code is "1" you are CSRS; if the
code is "5" your CSRS/offset; if the
code is "8" your are FERS; if the code
is "A" you are FERS w/Frozen CSRS
time. YOUR RETIREMENT CODE IS CRUCIAL
in giving you the correct answer.
Once that is established then you
"buying back" your non-career rural
time can be reviewed. Sometimes it
really does not make financial sense
to buy back the non-career time! The
only way to know that is for you to
order an "annuity estimate" (which
also should have the additional
paperwork in that estimate regarding
ALL periods of federal and/or military
time) from HRSSC, and then contact me,
so I can give you a personal response,
based on YOUR retirement system.
Roseanne
Q 4. -Roseanne, I am
retiring under the VERA at the end of
September. I have over 630 hours of
annual leave. Will I be paid by the
USPS the entire number of hours when I
retire, or will I have to use some of
that leave before I retire? TM
A 4. -Hi TM, Depends on a few
things...are you EAS or Craft?
Roseanne
Q 4. Follow-up: I am
an EAS employee. I'm getting out on
the incentive for PM's. They extended
my retirement date by 60 days. Thanks
for the fast response. TM
Q 4.
Follow-up Answer: Hi TM, For EAS
employees the carry over 560. You are
paid for ALL OF YOUR "EARNED" ANNUAL
LEAVE, particularly when it is in
conjunction with an early out. So to
figure this out...look at your pay
stub. YOU are PAID FOR WHAT YOU
EARNED. So at pay period 13, (and I
know yours was extended), you only
earned 104 AL hours for the year. You
would take what you carried over from
2011, add the 104 (add 8 hours for
each PP after PP13) and of course
reduce annual leave you used. If it is
over the 560, you still will be paid.
REASON: Because in an early out
scenario, you were not able to USE the
annual leave without losing it within
the year. Roseanne
Final
Response 4- Wow! You are good. Thank
you.
Q 5.- Hi Roseanne, I know
that no one really "knows" the answer,
but I am very curious (and hopeful)...
do you expect a VERA offer of any kind
(incentive or not) by the end of this
year, or 2013 for City Mail Carriers
with the USPS. I've completed 27
years, and am more than ready to go.
Any Chance? What percentage would you
give it that we get an offer by the
end of this year? How about 2013?
...How about EVER? Sick smile Thanks
D.
A 5. Hi D, Right now I don't
see that happening (for carriers)
until a complete overhaul is made of
the structure. What I mean is how we
deliver mail, time standards, color
coding, route changes etc. They very
well could offer an early out to the
carriers after they have reconstructed
delivery to incorporate a 5 day
delivery; change entirely how many
days they have to get a letter from
across the street to across the
country. We all know that anything
that has to get there overnight,
....are papers that have a WET
signature. Between email, and faxing,
texting, not many companies or people
really need to get it there in the
time frames the USPS has for delivery
of first class mail. But in the end,
yep...I see nearly all (except
maintenance) being offered early out.
AND all will be replaced with
employees making less money, leaner
benefits and possibly all part time. I
keep saying all the time, there will
be more early outs, and I am sure will
start back with EAS employees....but I
don't think they can keep affording to
offer an incentive. Roseanne
5.
Follow-up Hi Roseanne, Not "exactly"
what I wanted to hear, but I sure do
appreciate you taking the time to get
back to me! Oh well, I'll just keep
punching in, hoping and PRAYING! D
Q 6. - Hello, I am a Postal
Clerk, currently on Workers Comp. I
filed for Social Security Disability
and was approved in June 2011, however
I am not receiving Social Security
Disability while receiving OWCP
benefits. I am trying to find out
whether it would be in my best
interest to outright retire (I am 56
with 26 years of service and am under
FERS) or to file for disability
retirement. My only question (which
SSA has not provided me with the
answer to ) is, can I take my regular
retirement and still receive Social
Security Disability? I can't seem to
find this answer to this anywhere!
Thank you for your time/help. Tried to
keep this short, hope this enough
information. (I am scheduled for a
"retirement counseling session" in a
few days). DS
A 6. -Hi DS,
Typically the way this works, the
Postal Service pays OWCP to PAY you,
while on the "Periodic Rolls". If/When
you get approved for Social Security
Disability Ins., your OWCP
(Compensation) check should be reduced
by that same amount of the SS
check....but it takes SO MUCH
T...I...M...E!! The same goes for FERS
(OPM)approval. If you are approved for
FERS Disability Retirement, the first
year is calculated at 60% of your h-3
Av. Salary, divided by 12 (monthly)
for the first year. HOWEVER (if
approved for SSDI), 100% of the SSDI
check is reduced from the FERS amount
monthly annuity. The second year (&
until age 62) it's recalculated at 40%
of your h-3, and then 60% of the SSDI
check is reduced from the FERS
annuity. When you turn 62, it's
recalculated again, and for you it
would be calculated at 32% of your
high 3 average salary (monthly). If
you want my opinion...this is my
opinion, get off OWCP and go on
strictly with a FERS Disability
Retirement and SSDI. Too many people I
have dealt with are owing 20,30 even
40 thousand dollars, over the course
of time to different federal agencies,
because of all these agencies not
coming together with your case for
about 12-18 months. You have the post
office; OWCP; Social Security
Administration and OPM. That is 4
Federal Agencies all with some
financial interest trying to intercede
in YOUR retirement. It's a nightmare
of sorts.
There of course is a
reduction of income when you retire.
While on OWCP, you are being paid,
just like you are going to work
everyday. Retirement is different, it
is less money and the biggest portion
of your retirement as a FERS employee
is your TSP. Most folks on OWCP have
little or no money in TSP...and that
is a huge problem. In either case,
most FERS employees don't have the TSP
account they should have in
retirement, and then try to
financially rely on the FERS annuity,
which was never supposed to be but
about 28% of their overall retirement
money. Roseanne
PLEASE TAKE THE
TIME TO READ THIS
The above
question leads me to a phone
discussion I had with a brother and
sister last month, where the father
(postal employee) had very recently
passed away. They were both scouring
the internet to find someone to talk
with, about how to obtain their
father's life insurance (for his
burial expenses), their mother's
"spousal annuity" (she was in her
80's), as well as her health benefits.
In our conversation, they told me they
called OPM and were told "there is
nothing there to be entitled to".
Everyone else told them, "that had to
be incorrect..he was a postal employee
and they have retirement and benefits"
. They found a couple of wills and
even recall having discussions with
their Dad, prior to his passing, about
a precise dollar amount on a life
insurance policy ($15,000), in which
their mother was the beneficiary of; &
discussed with father, (and also
contained in the will(s)), that their
mother would be "taken care of" since
he was a CSRS employee and she would
get 55% of his annuity. After a couple
of preliminary questions...I had to
tell them that OPM was RIGHT!! There
was no spousal annuity & no FEHB
Health Benefits for the postal
employee's widow. There was NO Basic
or any life insurance either for this
postal employee! Are you intrigued
yet?
This postal employee
passed away from a heart attack...at
the age of 88+. He was on the OWCP
rolls for the last 40+ or so YEARS!!!!
He went every year like clock work, to
the doctor for his yearly validation
that he was unable to carry mail,
validating his OWCP claim. And so he
remained on OWCP, until he passed
away. In talking with brother &
sister, they were ALL aware (not that
they fully understood why or how) that
their father was "earning" the same
amount as every other carrier did, and
had not worked in 40 years. What the
family did understood was he did not
work due to an on-the-job injury to
his back. When the father passed away,
again unsure of how he earned so much,
but they were absolutely sure, with
him earning what he did, their mom
would be fine.
But they had no
idea what he gave up by staying on the
OWCP rolls aka Workers Comp, aka
Periodic Rolls, all those years and
NOT FULLY RETIRING! Yes, in the last
40 years, his income would have been
reduced if he retired, but he would
have had benefits. In this case here,
OPM was right. There is NO life
insurance for funeral expenses, no
spousal annuity or spousal health
benefits, because he passed away from
a heart attack, and not from his OWCP
back claim injury. All these years
this employee thought that his wife
would get his life insurance, a
spousal annuity & federal health
benefits....and she did NOT.
THERE CAN BE SEVERE CONSEQUENCES FOR
STAYING ON OWCP....RATHER THAN
RETIRING.
Till we speak
again....Roseanne |
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