Social Feeds

Be sure to Like and Follow FEDmanager on Facebook and on Twitter for exclusive content and news stories affecting the federal community and tips on maximizing your federal career and advancing in the federal workforce.

Subscribe!

Subscribe to our newsletter. It's FREE. Read our privacy policy

What is Interim Retirement Pay?

Written by James Marshall on . Posted in Dollars & Sense

If you are separating from federal service for retirement purposes, keep in mind that you might not receive your initial annuity payment from the Office of Personnel Management until approximately five to seven weeks from the date of your separation. You should be prepared for this lapse of income period.

Also, keep in mind that it can take an average of three to six months to execute the final adjudication of your retirement, depending on OPM’s staffing and workload. Some retirements are more complicated to compute than others, and OPM wants to triple-check everything before they finalize your retirement. OPM does not want to overpay anyone, but they understand that annuitants need their income, so they place folks into “interim retirement pay” status.

The duration and percentage of interim retirement pay can be affected by the following:

  • When applicable, the FERS Supplement is usually not included in interim retirement pay;
  • Special Group computations required for law enforcement officers, firefighters, and air traffic controllers;
  • CSRS Offset computations if CSRS Offset retiree will be 62 within 90 days (or is already 62);
  • Court-ordered benefits for a former spouse (filed with OPM);
  • Part-time service;
  • Unpaid deposit/redeposit service (if required for retirement purposes);
  • Unverified or missing service;
  • Insurable Interest survivor elections;
  • No survivor election; or
  • Waiver of military retired pay is not verified, if applicable.

Once OPM finalizes your retirement and verifies that any applicable taxes are withheld and premiums for insurance are paid, they will retroactively pay you a lump sum for any previous underpayments. But, meanwhile, you still have bills to pay. This might not be that big of a deal if you have a post-retirement job lined up, a spouse who is still working, or enough money saved to help cover living costs while waiting for OPM to finalize your retirement.

When you separate from federal service for retirement, you will begin receiving income on a monthly basis. When preparing to retire, it would be good to speak with your agency retirement counselor to determine when your last pay date will be for your final pay and unused annual leave. Compare this to when you might expect to receive your initial annuity payment from OPM and be aware of how long you might expect to be in interim retirement pay status. Depending upon our financial needs, you may or may not be okay with this lapse of income period, but at least you can start planning and be prepared for this.

For multiple personal reasons, many federal employees are not necessarily ready to withdraw income from their Thrift Savings Plan (TSP) immediately upon separation from federal service. But it’s good to be aware of your withdrawal options so you can plan for the future, whether you intend to postpone TSP withdrawals or not. Regardless, when you are ready to exercise your withdrawal options from TSP, you will be communicating with TSP, not OPM. Applying for income from TSP is a separate application process from applying for retirement from federal service. In next month’s article, I will cover the various TSP withdrawal options.

Keep in mind, it will often take approximately two to four weeks from the date of your separation for your agency to notify TSP that you are no longer employed. You will not be able to exercise your post-employment TSP withdrawal options until TSP receives this notification from your agency.

Click here for an update from OPM regarding Interim Retirement Pay.

James Marshall is a federal retirement benefits specialist and the owner of Federal Retirement Planning LLC. For more information, please visit the Federal Retirement Planning LLC website.

 

YGL Profiles

An Interview with Melanie Keller, Assoc. Director for Management, Center for Drug Evaluation & Research (CDER)

Melanie Keller is the Associate Director for Management at the Center for Drug Evaluation & Research (CDER), the largest Center at the Food and Drug Administration (FDA) within the U.S. Department of Health and Human Services (HHS). She serves as the Center’s Executive Officer and oversees all administrative operations. Ms. Keller is responsible for budget formulation, user fee collection, and execution of a $1 billion annual budget. She also leads and directs the Center’s human capital management of more than 4,500 employees, and is currently leading recruitment strategies for 795 vacancies within the Center. 

Read more...

From the Hill

Senators Explore Oversight of Small Agencies, Drafting New IG Bill

Senators last week discussed oversight of small agencies, commissions, and boards with a hearing before the Senate’s Financial and Contracting Oversight subcommittee.

Challenges of small agency oversight was discussed at the hearing, as were potential legislative actions to improve the oversight of such organizations.  

Chairwoman of the subcommittee, Sen. Claire McCaskill (D-MO) said at the hearing that there are at least 40 small agencies with over $1 billion in budgetary authority with “virtually no oversight.”

Read more...

Case Law Update

MSPB Grants Veteran’s Request for Corrective Action after DoD Rejected Job Application

A GS-12 Defense Contract Management Agency (“DCMA”) employee applied for a GS-13 position. The vacancy announcement, issued by DCMA, listed the DCMA and Department of Defense (“DoD”) employees that could apply for the position, and specified that applicants “MUST submit documents verifying your eligibility with your application package. These documents may include, but are not limited to: for current employment verification, a non-award [Standard Form (SF)]-50 or DD3434…” The DCMA employee’s application contained a resume, an SF-52, education transcripts, and a Form DD 214, but was rejected due to the employee’s failure to include an SF-50. An MSPB administrative judge found that the agency improperly rejected the employee’s application, because the SF-52 he included contained the same employment verification documentation. However, the administrative judge ultimately denied the employee’s request for corrective action because of a finding that the agency did not accept applications from individuals outside its own workforce under merit promotion procedures, and therefore had not violated statute by denying the employee, who was a veteran under 5 U.S.C. § 3304(f)(1), the opportunity to compete. On April 1, 2014, the MSPB reversed the initial decision in part, and granted the employee’s request for corrective action.

Read more...

GEICO's Good Stuff

Tell Us: Why Do You Heart Public Service

GEICO’s Good Stuff is a column series highlighting great stuff happening in the federal community.

The Public Employees Roundtable (PER) is collecting testimonials from government employees and members of the public in support of an I “Heart” Public Service whiteboard photo campaign. Images will be posted on the PER on Facebook and Instagram pages.

The group behind Public Service Recognition Week (PSRW), which takes place this year from May 4-10, launched the whiteboard campaign in support of this year’s theme: Proud to Serve.

Government employees and members of the public are invited to fill out their own whiteboard and share why they love public service and tag their photos with #PSRW and #Proud2ServeUSA.

Read more...