Federal Disability Retirement: A Dissertation Part 6

Oct 18, 2011

USPS mail van

Continued from Part 5 Dissertation…

This is the general CSRS retirement computation:

During the first five years of service you earn 1.5% of your High-3 salary for each year of service. During the second five years of service you earned 1.75% of your High-3 salary for each year. For every year of service over 10 years, you earn 2% of your High-3 average.

Let’s take a look at some examples of a few CSRS employees’ retirement calculations.

CSRS example 1. This postal employee has 30 years of federal service and is 57 years old with a High-3 of $54,000. This employee would receive 1.5% of the High-3 per year for the first five years of credible service totaling 7.5%. They would also receive 1.75% per year for the next five years of credible service totaling 8.75%. Each additional year, totaling 20 in this instance, gives 2% credit. That total would be 40%.

7.5% +8.75% +40% = 56.25% of the High-3 for a gross yearly benefit $30,375.00

That calculation is the same whether the applicant filed for disability retirement or simply filed for immediate retirement. Because they were over the age of 55 and had more than 30 years of credit service, the disability calculation is not more beneficial. This is a rare occurrence for most federal employees, but on occasion it makes more sense to simply retire.

To be continued…

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