Federal Employee Retirement Checklist

Retirement from Federal Service.

This is the holy grail of your career. You work so hard, save so much, and it all culminates into your final days as you waive the proverbial flag of relaxation; all while your co-workers, soon to be former co-workers stare at you with utter jealousy.

This, for many, is absolute bliss.

But, this is near the end of the retirement planning process. This is what all the prior work has led to–the problem for many is in deciding where to start.

I get this question all the time:

“Cooper, I want to retire, but where do I even start?!”

AND, here is my answer to that question and many others like it. Start with a retirement checklist. Not just any checklist, though.

Start with my Federal Employee Retirement Checklist.

Step One: Decide if It’s Time to Retire

For many, retirement seems like this far off beacon, constantly reminding you just how far away you are. That is until it’s right up in your face and you have to decide if you want to take it.

Simply being able to retire, does not mean you should retire.

This is a distinction that must be realized.

I see it often; someone will look at their years of service and age and automatically think they can retire. Unfortunately, there are a lot of other factors that go into such a large decision

Things like:

  • What are your living expenses going to be in retirement?
  • When will you file for Social Security?
  • How much longer will your spouse work?
  • How much debt do you have to pay off?
  • Is there enough money in your TSP to supplement your income?
  • What interest rates do you have to earn in order to meet your living expenses in retirement?
  • What will you do with all of your extra time in retirement?
  • Will you be fully retired or work a part-time job?

And this is just a start. Seriously, this is nowhere near an exhaustive list of questions I work through with federal employees in preparing for retirement.

If this is daunting, I’m glad. I want you to be absolutely positive that when you enter retirement, barring something absolutely catastrophic, you are prepared for retirement.

Sidenote: What will you do with your time in retirement?

Retiring should not mean you no longer make contributions to society. Time and time again it’s been shown that those without purpose in retirement, live shorter lives than those who are intentional with their time.

Recent studies have shown that those who retire early, are more likely to die early. A grim and ugly truth, I know.

This is a topic I will write in-depth on in the future, as it’s something I’m passionate about. Too many go into retirement without a plan. No plan for their money or more importantly, their time. To maximize your retirement, you MUST plan what you’re going to do. Otherwise, your retirement could very well be your initial descent into the grave.

On a more practical level, contact your agency’s human resources office to determine how to review your personnel history. Every agency is different (go figure), and for some, there will be large paper files while for others there will be more up to date internet databases.

Most of you will know your Service Computation Date (the date you began service.) If you don’t know it, it should be located on your leave and earnings statement. However, the actual date that is used is the one found within your personnel records.

Your personal records will likely contain quite a bit of useful information. This includes:

  • Retirement coverage available during your career as a federal employee
  • Type of service (i.e., – full-time, part-time, temporary, etc.)
  • Leave periods without pay
  • Start and ending dates for all federal service (including military time)
Step 2: Request a Retirement Estimate

Use your Human Resources office.

Although the people in those departments are typically overworked, and understaffed, they will be able to provide some help.

One of the best ways to use your HR department is to request a retirement estimate based on a specific departure date. You can also do this yourself through various online resources, such as FedCalc.com. But, the HR department is there for your use, so you might as well take advantage of their free services.

If you’ve yet to come up with a retirement date (and yes, using tomorrow as a proposed retirement date is not a good idea), then request an estimate for your first retirement eligibility date. Something to be aware of before requesting an estimate though is to make sure your agency isn’t limiting estimates to only employees within a couple of years of retirement. This will start to become even more prevalent as baby boomers retire.

Within the Retirement Estimate, you’ll find a few things that will be beneficial to your planning:

  • Retirement Date: This one is somewhat obvious, but this date is very important. Double check to make sure the date you requested for
  • Deposit Information: It’s possible you’ll have to pay a service credit deposit if you’d like an unreduced retirement (you do) or to receive credit for certain service (such as military.)
  • Service History: The estimate will provide both beginning and ending dates of each of your federal service appointments. Along with the dates, it will also include the agency you worked for as well as the type of retirement coverage you had.
  • Information on Salary: Your retirement benefit will be based on your highest three years of salary; also known as the “High-3.” This information will be included and should be reviewed for accuracy.
  • Survivor Benefit Elections: If it’s included in your file that you’re married, the benefits specialist will include the survivor benefits available to your spouse as well as their cost. This can be costly, so be sure to do your research on available options.
  • Retirement Benefit: Typically this will be in a monthly format. Deducted from the monthly retirement benefit will be taxes and insurance. This does not include your TSP, social security, or other sources of income. So, don’t base your whole retirement planning on this number, there’s likely more to picture.
  • Additional Information: Things like FERS Special Benefit, CSRS Offset, part-time work, sick leave, and other information related to your career will all affect your Retirement Estimate.
Step 3: Deep Information Planning

When you meet with your HR department, it’s important to let them know all of the things that could happen in the future.

For example, a plan to get married or divorced in the future should prompt you to find out more information on survivor and health benefits coverage for your future or former spouse. Without a doubt, survivor benefits are all too often overlooked.

When you start to see all of the implications involved with your retirement decisions and how they affect your spouse, it quickly becomes apparent that time and energy must be spent in planning for the future. Your retirement does NOT just affect you. It affects your whole family, and you need to treat it in such a manner.

Here are a few quick tips to be on the look out for.

1. Have you paid a redeposit of a prior CSRS refund?

If so, this is something you need to share with your HR department. Go to these meetings with the idea that the person you’re talking to has no idea about any of your career. This will allow you to share all of your information. The more the HR department knows, the more they can help you.

2. Did you graduate from a Military Service Academy?

Many in the military went to academies like West Point and others for their schooling. If this is the case for you, you can receive credit for those four years of service/education. AND, this isn’t like half credits, we’re talking about the equivalent of full-time active duty military service.

3. Did you ever have work as a seasonal employee?

Many federal employees started out as seasonal employees during the college years.

Make sure that this time is counted because it does go towards your retirement. As I’ve said, if you’re not sure, then ask. The more you can add to your retirement, the better off you will be. Trust me.

4. Determine your Insurance Needs

Federal Employee Health Benefits (FEHB) is one of the best benefits you have available to you as a federal employee.

Not only do you have life insurance (not a very great benefit actually) and health insurance, but there’s also dental, vision, and long-term care insurance available to retirees and their families.

There are certain requirements that must be met, so make sure you review those with your HR department.

Step 4: Update Your Beneficiaries

I constantly remind federal employees about this on the Fed Retirement Planning Facebook Page.

Your beneficiary selections don’t automatically change as people come into and out of your life. Although it would be great if they did, they don’t and probably never will.

YOU are responsible for updating these forms, and it’s simply too easy not to keep them updated.

Here are links to OPM’s forms that may be helpful:

Step 5: Put it all Together

I’d love to say, “hire a financial planner,” but it’s not necessary for EVERYONE. As I’ve stated many times, for a majority of people, a financial planner can be very beneficial and actually save you money over time. And no, I’m not just saying that because I am one.

For my clients, I use software to bring everything together. This makes it easier and allows clients to see their financial situation in real-time.

However, it is possible to view your situation without expensive software.

I would suggest employing a program like Excel to help look at all you have.

In order to help accomplish the task of preparing for the daunting task of retirement from federal service, I’ve created a detailed checklist on how to approach retirement starting 5 years out.

Sign up below to receive the checklist for download:

Final Thoughts

Retirement is a big deal.

It’s the reason I started this blog; to help alleviate some of the stress associated with the process.

If you only get one thing from this article, I hope it’s that your retirement should be taken seriously. You should approach the task of planning to retire with the same diligence you undertook in applying and interviewing for your career.

The more planning you do before retirement, the less stress and struggle you’ll have while in retirement.

Don’t be the person who goes into retirement, planning never to work again, and then having to go back to work because they retired too early or didn’t plan well enough.

Are there any steps that I missed? Let me know in the comments, and I’ll add them!

– Cooper Mitchell

Author Cooper Mitchell

Hello, I'm Cooper. I am the President of and an Investment Advisor Representative for Dane Financial, LLC. I specialize in helping Federal Employees better understand their benefits and prepare for retirement through Comprehensive Financial Planning and Investment Management. When I'm not helping federal employees, you can find me focusing on other entrepreneurial pursuits, spending time with my beautiful Wife, worshipping Christ, blogging, lifting (somewhat) heavy weights, and reading non-fiction.

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