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Best Dates to Retire - CSRS / FERS: 2014 and 2015
Edward A. Zurndorfer, Certified Financial Planner





Previous columns on MyFederalRetirement.com discussed the best dates for CSRS

and FERS employees to retire during 2009 through 2014. This column discusses the

best dates for CSRS and FERS employees to retire during 2015, with an updated

discussion for best retirement dates during 2014.

Before presenting these dates, it is important to review some rules and

issues that employees covered by the Civil Service Retirement System (CSRS)

(including CSRS Offset employees) and employees covered by the Federal Employees

Retirement System (FERS) (including TransFERS* employees) should be aware of:

• Effective date of retirement and issuance of first annuity

check.

CSRS employees (including CSRS Offset employees) who retire on the first,

second or third day of the month will have their retirement become effective on

the next day and their first retirement check will be dated the first day of the

next month. For example, if a CSRS or CSRS Offset employee retires Jan. 3, 2014,

then the employee's retirement becomes effective on Jan. 4, 2014 with the first

annuity check being dated Feb. 1, 2014. If a CSRS/CSRS Offset retires on the

fourth through the last day of a month, then the employee's retirement becomes

effective the first day of the following month with the first annuity dated the

first day of the month thereafter. For example, if a CSRS/CSRS Offset employee

retires on Jan. 11, 2014 (the end of the 2013 leave year at most federal

agencies), then the employee's retirement becomes effective Feb. 1, 2014 with

the first CSRS annuity check dated Mar. 1, 2014.

For FERS-covered employees, no matter which day in the month a FERS employee

retires, the employee's retirement becomes effective the first day of the

following month. The first annuity check will then be dated the first day of the

following month. For example, if a FERS-covered employee retires Jan. 11, 2014,

then the employee's retirement becomes effective Feb. 1, 2014 and the first

annuity check will be dated Mar. 1, 2014.

• Treatment of unused annual leave at the time of

retirement.

All retiring employees are paid in a lump sum payment for any unused annual

leave hours on the day of their retirement. The lump sum payment will be

directly deposited into the same bank account that the employee's paychecks are

directly deposited in. Most agencies directly deposit the lump sum annual

payment within two to six weeks of the employee's retirement date. Many retiring

employees use their lump sum annual leave payment to pay their bills until they

receive their first full annuity check. The deposit of the first full annuity

check could take as long as three to eight months after the employee's

retirement date.

An employee must be in "employee status" for the entire last pay period of

work in order to accrue the full amount of annual leave hours for that last pay

period. An employee who retires before the end of a pay period (for most

employees, that is before the second Saturday of a pay period), will not accrue

any annual leave hours for the last pay period the employee worked. This assumes

that the employee has a Monday through Friday work schedule.

In selecting the best days to retire during 2014 and 2015, the issue of

accruing the full amount of annual leave hours for the last pay period worked

should be considered. Since most federal employees work a Monday to Friday 80

hour, bi-weekly payroll schedule, it is assumed that the best day of the week to

retire is a Saturday, the last day of the pay period. The first day of a new pay

period (which for most employees on a Monday to Friday work schedule) in which

the employee will no longer be in employed status, is also a good day to

retire.

• Treatment of unused sick Leave at the time of retirement.

Prior to a law change effective Oct. 28, 2009, only retiring CSRS and CSRS

Offset employees were eligible to add any unused sick leave hours to their

service time for the sole purpose of calculating their CSRS annuities. Note that

unused sick leave cannot be used for retirement eligibility purposes, however.

Unused sick leave is used only for CSRS or FERS annuity computation

purposes.  Before Oct. 28, 2009, FERS employees did not receive credit for

unused sick leave. As a result, FERS employees who retired before Oct. 28, 2009

forfeited all of their unused sick leave hours as of the day of their

retirement. But the law changed effective Oct. 28, 2009 with Congress deciding

to "phase-in" the unused sick leave hours benefit for FERS employees. In

particular, those FERS employees who retire before Jan. 1, 2014 get credit for

50 percent of their unused sick leave hours as of the day of their retirement.

FERS employees who retire on Jan. 1, 2014 or later will get credit for 100

percent of their unused sick leave hours on the day of their retirement (like

CSRS/CSRS Offset employees).

With this information in mind, the following table presents the best dates

for CSRS and FERS employees to retire during 2014 and 2015. The dates presented

were selected under the following guidelines:

  1. The dates are the end of a pay period (Saturday) or the first day of a new

    pay period (Sunday); and

  2. For CSRS /CSRS Offset employees, the day of the month selected is within the

    last three days of the month or within the first three days of the following

    month. For FERS/TransFERS* employees, the day of the month selected is within

    the last three days of the month selected. The reason behind retiring within the

    last three days of a month or within the first three days of the following month

    is to allow receipt of the first annuity check within four to five weeks of the

    employee's retirement date.

The dates selected in the table are determined from the Office of Personnel

Management's 2014 and 2015 leave year calendars:



* TransFERS employees are employees with at least five years of CSRS

service who voluntarily transferred to FERS during one of the two FERS "open

seasons" held in 1987-88 and 1998. Upon retiring, these employees receive both a

CSRS annuity and a FERS annuity but follow FERS retirement eligibility rules

even though they are also receiving a CSRS annuity.   

Posted:  01/30/2013

About the Author

Edward A. Zurndorfer is a Certified Financial Planner, Chartered Financial

Consultant, Chartered Life Underwriter, Registered Health Underwriter,

Registered Employee Benefits Consultant and Enrolled Agent in Silver Spring, MD

-- and the owner of EZ Accounting and Financial Services, an accounting,

tax preparation and financial planning firm also located in Silver Spring,

MD.  Zurndorfer is also is an instructor at federal employee

retirement seminars throughout the country and writes numerous columns and books

on federal employee benefits.



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