Can I Get FERS and Military Retirement?

The Federal Employees Retirement System (FERS) provides retirement benefits to most federal civilian employees, while military retirement offers a pension to those who serve a sufficient period in the armed forces. A common question for individuals with both federal civilian and military service is whether they can receive benefits from both systems. It is generally possible to receive both a FERS annuity and military retired pay, but this involves specific rules and considerations regarding how military service is recognized and how benefits are coordinated.

Understanding Federal and Military Retirement Systems

The Federal Employees Retirement System (FERS) is a three-tiered retirement plan for federal civilian employees. Its components include a basic benefit plan, which is a defined benefit annuity, the Thrift Savings Plan (TSP), a defined contribution plan similar to a 401(k), and Social Security benefits. To be eligible for an immediate FERS basic benefit annuity, employees generally need to meet specific age and service requirements, such as reaching minimum retirement age (MRA) with at least 30 years of service, or age 60 with 20 years of service, or age 62 with 5 years of service.

Military retirement, in contrast, is a pension provided to service members who complete a specified number of years in the uniformed services. This pension is typically available to those who complete 20 or more years of active duty service, with the amount of the pension calculated based on the service member’s years of service and their retired pay base, which is often their highest three years of basic pay. Unlike FERS, which has multiple components, military retirement primarily consists of a defined benefit pension. Both systems aim to provide financial security in retirement, but their structures and eligibility criteria are distinct based on the nature of the employment.

Crediting Military Service for FERS Benefits

Federal employees with prior military service can potentially credit that service towards their FERS retirement eligibility and annuity computation. To receive FERS credit for military service performed after December 31, 1956, an employee must make a “military deposit” to the FERS fund. This deposit represents the amount that would have been withheld from the military pay for FERS contributions had the service been federal civilian employment, plus a statutory interest charge if not paid within a certain timeframe.

Making the military deposit is crucial because it allows the military service time to be included when calculating the FERS annuity amount. If the deposit is not made for post-1956 military service, that period of service cannot be used in the FERS annuity computation, though it may still count for eligibility purposes in some cases. Active duty service is generally creditable for FERS purposes upon payment of the deposit, while inactive duty for training (such as weekend drills for reservists) is typically not creditable unless it qualifies as active duty for retirement purposes.

Receiving Both Federal Civilian and Military Retirement Pay

However, a specific coordination rule applies if the same period of military service has been credited towards the FERS annuity. If a military deposit was made for post-1956 military service to receive FERS credit, then the individual must waive their military retired pay for that same period of service upon retirement from federal civilian service. This waiver prevents the “double-counting” of the same period of service for the purpose of calculating two separate government pensions.

The purpose of this waiver is to ensure that a single period of government service does not generate two distinct annuity payments from the federal government. If military service was performed before 1957, or if no military deposit was made for post-1956 service, then both the FERS annuity and military retired pay can typically be received without a waiver requirement for that service period. The Office of Personnel Management (OPM), which administers FERS benefits, is responsible for processing this waiver at the time of the federal civilian retirement application. The individual electing to receive FERS credit for military service will usually be presented with the necessary forms to effectuate the waiver of military retired pay for the relevant period.

Social Security and Dual Retirement Benefits

FERS employees contribute to Social Security throughout their federal civilian careers, making them eligible for Social Security benefits based on their earnings history. Military service also contributes to Social Security eligibility, as service members generally pay Social Security taxes on their basic pay.

Receiving a FERS annuity and military retired pay typically does not directly reduce an individual’s Social Security benefits. Unlike some other government pension systems, FERS employees are fully covered by Social Security, meaning their Social Security benefits are calculated independently based on their covered earnings from both federal civilian and military service. Provisions like the Windfall Elimination Provision (WEP) or Government Pension Offset (GPO), which can reduce Social Security benefits for individuals with non-covered government pensions, generally do not apply to FERS employees’ direct FERS annuity because FERS employees contribute to Social Security.