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Work five years and retire with a pension
mogley98
Member Posts: 18,291 ✭✭✭✭
Under both CSRS and FERS, Members of Congress
are eligible for a pension at the age of 62 if
they have completed at least five years of service. Members are eligible for a pension at age 50 if
they have completed 20 years of service, or at any age after completing 25 years of service. The
amount of the pension depends on years of service and the average of the highest three years of
salary. By law, the starting amount of a Member's retirement annuity may not exceed 80% of his
or her final salary.
are eligible for a pension at the age of 62 if
they have completed at least five years of service. Members are eligible for a pension at age 50 if
they have completed 20 years of service, or at any age after completing 25 years of service. The
amount of the pension depends on years of service and the average of the highest three years of
salary. By law, the starting amount of a Member's retirement annuity may not exceed 80% of his
or her final salary.
Why don't we go to school and work on the weekends and take the week off!
Comments
Additionally, the pension systems mentioned are the same for Federal employees and is substantially less than what congress used to have.
The 80% is a bit misleading as presented. Under CSRS, the old system, the employee needed to work 40 years to receive it. I doubt that a FERS employee would ever receive any where near 80% since they also eligible for social security at age 62.
Long gone are the days when Congress could receive a big pension after serving about a couple of terms and payable immediately.
CSRS and FERS sound good, PERS sounds a LOT better.
Heck, I was vested for retirement after five years with a private company. That's also when I got laid off. I got a lump sum that wasn't huge, but it added to my existing retirement investments quite nicely. Twenty years later, when I did retire, it had doubled.
A lot of people would have considered that lump sum money a windfall and gone right out and spent it.
My friends Keith and Tom both work for a local municipality and are covered under CALPERS (California Public Employees Retirement System). Their pension is based the highest consecutive 12 months of full time employment (overtime is not included) and set a 2.5% for each year of service at age 55. If (for example) they have worked 30 years and retired at age 55, they would receive a 75% pension. They can retire was early as age 50, but at a greatly reduced rate. Minimum working time to be vested in the program is five years of full time employment. In the case of Keith, who is a former Marine, He can apply up to three years of prior military service. There is no "cap". If they work 40 years, they can receive 100%.
CSRS and FERS sound good, PERS sounds a LOT better.
Mrs K's pension is also through CALPERS, though not quite as generous. Five years to be vested in more or less standard and those with less than five years service will not receive a pension. They receive a lump sum payout.
You did not mention that in order to collect a FERS pension you need to be 62.
Additionally, the pension systems mentioned are the same for Federal employees and is substantially less than what congress used to have.
The 80% is a bit misleading as presented. Under CSRS, the old system, the employee needed to work 40 years to receive it. I doubt that a FERS employee would ever receive any where near 80% since they also eligible for social security at age 62.
Long gone are the days when Congress could receive a big pension after serving about a couple of terms and payable immediately.
Civil Service was 30 years & age 55. FERS is 62 for full benefits & 55 with 5% less for each year under 62. My Postal pension is a combination of both since I changed over to FERS. FERS also includes a very good savings plan where you can invest up to 10% of your salary tax exempt & they match the first 5%.
They had left Alaska the previous year. She had 20 years teaching in Alaska, he with 25 years. Both were in their 40's. Fit, healthy, happy.
She had a 100% pension, him a 125% pension. Which started immediately upon "retirement".
You did not mention that in order to collect a FERS pension you need to be 62.
Yes I did
"Members of Congress
are eligible for a pension at the age of 62 if
they have completed at least five years of service"
pensions and benefits especially for those in govt may never cease...they'll just get more tax increases to cover it
On a local and state level, I can't disagree. On the Federal level it is a bit different. Effective in 1984 Congress & President Reagan changed the federal pensions from CSRS to FERS to save billions in future years and we're starting to see the savings now. IIRC Congress has floated the idea of another major change to save money.
Federal employees hired < 1987 were covered by Civil Service, which pays 80% only after 41 years, 10 months of service; that doesn't leave a whole lot of years for retirees to enjoy the fruits of their labor. The FERS system actually costs the taxpayers more; Congress, as usual, wants to make current employees contribute more & get less.
Many state/local governments have overly generous pensions plans that can't be sustained. We've started to see cities & states go bankrupt; it will get much worse. California is in big trouble; the federal government can't bail them out. I foresee a lot of retirees living in the streets.
Neal
Perhaps for lack of a better term than pension, we have now more than one generation who collect:
Welfare
Food stamps (SNAP, AFDC)
Housing Assistance
Basic grants
Unemployment insurance (Now a lifelong entitlement)
Cellular service
Exempt from taxation, Earned Income Tax Credit
Free medical and dental care
GPA, General public assistance
LIHEAP, Low income home energy assistance programs
Supplemental Socials Security programs
Disability. (I post disability because abuse is rampant)
Vote Socialist and Democrat. Because EVERYBODY deserves a bit of what you work hard for.
pensions and benefits especially for those in govt may never cease...they'll just get more tax increases to cover it
That is what they thought in Greece.
What is now happening there is scarring the heck out of gobment employees everywhere and for good reason.
For the first time (in our lifetime) countries are beginning to run out of other people's money
"Fools learn from their own mistakes. I learn from the mistakes of others"
Otto von Bismarck