|
|
 |
|
|
 |
| Share |
 |
 |
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. |
|
|
|
|
Postal Retirement
Q&A July 2012 |
Good Day Postal Employees:
This has been a very
busy month with the early out's that
were offered to mail handlers and
postmasters. I have had many of you
write and ask about the possibility of
an early out for clerks, city letter
carriers, rural letter carriers and
supervisors. These decisions will be
made after the organization sees how
many have actually retired, from this
round of early out's and decide if
they need to reduce staffing even
further. If you look over the past few
years, the early out's started back in
2009, and have continued still. So the
question of WILL YOU be offered an
early out if you are in the categories
above. If they feel that is the only
way to reduce the number of employees
still on the rolls is to offer an
early out with or without an
incentive, to get to the staffing
numbers they need to efficiently and
fiscally operate the organization,
they will. I used the word
efficiently...because with mass
retirements, comes a loss of long-term
knowledge, and extensive skills and
abilities. Yea, I know there are quite
a few employees out there, that feel
many of their co-workers should
retire, have the years and age to
retire...and many of you know...they
should, but they won't. Many of the
CSRS employees have the "41yrs. 11mo.
mind set" and are waiting to collect
80% of their high 3 average salary,
and will not leave until they reach
that magic number. FERS employees
don't have that "magical" year
combination, because of their 3-tiered
retirement plan. FERS is only one
component of that 3 tiered plan. The
BIG money for FERS employee's in
retirement is TSP...so you had better
fund it WELL!!
Also this month,
I have had discussions with a few
employees that have been reviewing
their eOPF in liteblue, and found
documents that did not belong to them.
Please, as I have said in the past,
you need to review your eOPF
periodically. This will also ensure
that any discipline which has a 2 yr
life in the OPF (providing there is NO
other discipline within that 2 year
time frame (from the date of the
discipline), has been removed from
your eOPF. If you have not had
discipline in two years from the date
of the last discipline, you can
request to your district labor
relations office to have the
discipline removed from your file. As
an example, in speaking to one
employee who was getting ready to
retire and was looking for a
beneficiary form, found discipline in
his file from 22 years ago that was
never removed, AND a health benefit
form that did not belong to him. It
had the same last name, but was not
the same person. A word to the
wise....
I will begin this
column with the answer to question #6,
that many of you requested that I
publish the answer...sorry about
that..
FROM JUNE 2012:
Q
6.Hi Roseanne, Just a quick question
,I received my Personal Statement of
Benefits-2012 the other day. At the
bottom of the page it says total
creditable service is 35 years and 4
months. It then states for optional
retirement under CSRS you will receive
an annuity equal to approximately 66%
of your average high -3 salary. My
question is I thought for each year of
CSRS service worked, is equal to 2%
for each year worked minus sick leave,
if so why is it only 66% for 35 years
and 4 months and not 70% (2 x 35= 70)
? Thank You, B
THE ANSWER:
Although everyone will use the term
"56% at 30 years...However, the exact
calculations are as follows:
1.5% X HI-3 Av Salary X 5 (first 5 yrs
of employment)
1.75% X HI-3 Av
Salary X 5 (next 5 yrs of employment)
2.00% X HI-3 Av Salary X remaining
yrs( balance of yrs of employment)
***********************************************************************************
Q 1. -Hi Roseanne, I enjoy reading
your newsletter. I am FERS with 28
years of service. I am 52 years old.
If a VERA is offered and they make me
eligible to retire (by 25 yrs service
for example), how do the 3 parts of
retirement work? I know I would get
the postal annuity (minus health,
life, etc) but would I still get the
SS supplement at age 56 (my MRA) even
if I retire before age 56? Would it
kick in at 56? Or do I have to work
until age 56 to get this? And as far
as the TSP goes, can I take monthly
TSP annuity payments without penalty
at 52? Is it just if I withdraw the
entire amount before age 59 that I
would get 10% penalty? Thanks, AW
A 1. - Hi AW, IF you are offered a
VERA early out retirement:
1.
At age 52 w/28 yrs makes you ELIGIBLE
to retire under VERA rules.
2. You
would get your FERS annuity, minus
life & health insurance, Fed tax and
depending what state you live in state
tax.
3. As far as your special
supplement, you would receive that
WHEN you turned your MRA
4. TSP,
when an early out is offered there are
special "considerations" given to your
TSP fund. The 59.5 issue is confusing
and does not really play into at all,
when you are dealing with an early out
retirement and as a FERS employee,
when you are at your MRA. If you are
not at your MRA, then other rules
apply. But UNDERSTAND THIS ABOVE IS
ONLY IF A VERA IS OFFERED. Roseanne
Q 2. -I have been exploring the
advisability of seeking an alternative
to my 5X life insurance available
through the USPS group term. This
payment, although seemingly expensive,
is nothing compared to the cost of
that benefit when I become an
annuitant (something in excess of
$400.00 vs. the current $163.00+ as an
active employee). I am thinking that
State Farm can find a competitive
vehicle especially if that annuitant
figure is the bi-weekly charge. I
assume since the amount deducted from
pay is the bi-weekly amount on the
estimate so is the >$400.00 figure.
Ouch! Perhaps SF can't beat the
employee group rate but it seems that
surely they will be able to beat the
annuitant amount. Exploration with
agent in progress.
Just need to
check that the rate goes up that much
as reflected by the annuity estimate.
Will the Health benefit suffer the
same expansion? Plus, the figure given
for the "retirement income" is
actually what might be expected in
gross amount as delineated on the
estimate. I only have 17 years in
(age:64) and I am uncertain about that
figure, especially with the prospects
of a VERA. I am an ET and have heard
nothing about our inclusion in this
long kiss goodbye prospect. K
A
2. - The rates for life insurance
(FEGLI) have increased dramatically
for basic life insurance no reduction
and the 50% reduction. The rates for
Option C and Option B have also
increased. You should go opm.gov to
get the new rates so you can evaluate
the increase for these optional
insurance's as you age, and make a
decision to continue paying as an
employee, and possibly into
retirement, or look to an outside
insurance policy that no doubt will be
much more reasonable. Roseanne
Q 3. - Years ago I attended a session
you held at the Greensboro District
Office when there was a VERA offer.
You discussed the difference between
the No Reduction, 50% Reduction, and
75% Reduction of the Basic Life
Insurance. You showed us some figures
and calculations and came up with a
recommendation as to which was better,
but I don't remember which is was. Can
you let me know which you recommend
and why? Thank, C
A 3. -Hi C,
Well, since I did that session, the
rates for no reduction and the 50%
reduction have skyrocketed...the most
economical choice is the 75%
reduction. If you tell me what your
current salary is, I can give you the
figures for the no reduction; 50%
reduction and the 75% reduction.
Roseanne
R 3. - $56,810.00
RA 3. -56,810 rounded up to the
nearest thousand (57) plus 2G= 59,000
of basic life insurance.
No
reduction $241.60 per month (until age
65). At age 65+ $222.43 per month, and
unless you cancel, you will always pay
$222.43 per month, and the insurance
will always be valued at $59,000.
50% reduction $92.04 per
month(until age 65). At age 65+ $73.16
per month, when the payment reduces to
73.16, the $59,000. begins to reduce
also at the rate of 1% per month until
the insurance reaches $29,500 and
remains that..but it also means you
will be paying 73.16 for life.
75% reduction $19.17 per month (until
age 65). At age 65+ and over is FREE.
And when the payment stops, this
$59,0000. begins to reduce at the rate
of 2% per month until the insurance
reaches $14,750 and remains that. It
takes about 3 years for both the 50%
and 75% reductions to be complete, at
about age 68. Roseanne
Q 4. -Hi
Roseanne,Thanks for listening, I
started 1/72 as a CSRS PTF carrier and
got out in 5/84 to raise a family,
when I left I took my 11000.
retirement. I recently went back in
5/05 to present as a PTF CSRS/offset.
Finally after 7 long months I received
paperwork for a payback amount. I will
have to payback 53,000.00. How on
earth do I figure if this would be
worth it and how do I find out when I
can retire, and most importantly how
much I would get a month for an
annuity? If you can point me in the
right direction it would be
appreciated. Thanks, S
A 4. -
Hi Susan, What you are paying back is
12 years and 4 months of federal
service. How it was calculated is
6.14% (may be a point of percentage
off) of your earnings for those
12y4mo..THEN that is compounded by
interest for the last 28 years!! The
amount that you have to pay to even
begin the "buyback" is exactly the
6.14% (initial deposit)of what you
owed without the interest. Now the
question, is it worth it?? If you are
a CSRS/offset, your retirement will be
calculated as a CSRS employee...when
you turn 62, then it is recalculated
because you are eligible to draw a
social security check. If you are a
FERS employee, then you are adding
about 12% to your annuity. Is the 12%
added each month worth it?? It depends
on what your high 3 salary is...if you
are CSRS/offset or if you are FERS. If
you send me what your high 3 salary is
and if you are CSRS/offset or FERS, I
will show you what the calculations
are, and then you can decide if it's
worth it or not...just going by my
overall knowledge, and especially if
you are FERS, I don't think it's worth
it. But send me the info and I will do
a few figures and see. Roseanne
R 4.- Wow that was fast, thank u
so much. From 1972 to 1984 I was a
CSRS, and from 2005 to present, I am
CSRS/offset. Does it matter in any way
that I have been a PTF the whole time?
In 2012, I earned $54,600, in 2011 $
52,250 and in 2010, $54,200..so now I
have 19yrs and 1 month, and I am 59
1/2. Is it 60 with 20 years service
minimum to retire. Much appreciate,
S.,
AR 4. - Hi S, Even as a
CSRS/offset, you are governed by CSRS
rules...so you can retire at age 55
with 30yrs or 60 with 20 yrs or 62
with 5 years....unless an early out is
offered to you. If no early out is
offered, then you need to wait until
you are at least 60 with at least 20
years..so in reading this, I suspect
you will be 60 and then you will a few
months later have 20 years...and that
is when you can retire.
As far
as the PTF thing is concerned...yep,
they are going to ensure that you have
40+ hours. As a PTF, you can only get
the annuity estimate, twice a
year...because it is not calculated in
the NARCES estimate as full time
employees are done. This creates
difficulty in really KNOWING how much
your retirement (monthly) annuity will
be. This is for ALL PTF employees.
Much of it has to do with "just how
many hours did you work". So, with the
amounts that you gave me:
54,600+52,200+54,200=$161,000 divided
by 3 = 53,666 as your high 3 average
salary.
53,666. X 1.5%=804.99 X
5 (1st 5 yrs of employment) = $4024.95
53,666. X 1.75%=939.15 X 5(2nd 5 yrs
of employment) = $4695.55
53,666. X
2.00=1,073.32 X 10(balance of yrs of
employment)= $10,733.20
$19453.70
Yrly Annuity
19,453.70 divided
by 12 = $1,621.11 monthly WITHOUT
SPOUSAL ANNUITY
$1,459.14 monthly
with a spousal annuity
If you
paid back that "amount" of money...it
would add 12 years, an additional 24%
SO 53,666. X 2.00% = 1,073.32 x
20= 21,466.40+ 4024.95+4695.55=
30,186.39
30,186.39 divided by 12
=$2515.52 monthly WITHOUT SPOUSAL
ANNUITY
$2264.52 monthly without
spousal annuity
And that is all
well and good UNTIL you turn 62, and
then your retirement is recalculated
by OPM, because you are eligible for
social security. Unlike regular CSRS
employees, your social security will
NOT be reduced...whew!! I hope this
has helped in understanding your
retirement plan. Roseanne
RR 4.
- Roseanne you are amazing! Thank you
so much for your time and expertise..I
will be reading your section in postal
mag....S.
Till we speak
again........ Roseanne |
|
|
|
|
|
|
|
|
