Every new year, the OPM receives a flood of retirement applications, pushing its capacity to the edge. As a federal employee considering or planning for retirement, understanding how the annual retirement surge can affect you is crucial for a smooth transition into your post-retirement life.
Why is there an Annual Retirement Surge?
Between December 2022 and January 2023, the OPM saw a more than 100% increase in retirement applications. This winter increase, which happens yearly, is tied to several key factors:
- Many federal employees like to retire at the end or beginning of a calendar year. Retiring on December 31 or January 1 allows individuals to maximize their financial benefits. This includes receiving the highest payout for their unused vacation days and a full year’s salary.
- Federal workers who retire at the end of the leave year receive maximum leave payouts since unused annual leave does not carry over.
- Some workers wait until after winter holidays to retire so they can enjoy one last holiday season before leaving their job.
- Retiring on January 1 can lead to higher pensions for federal workers since it aligns with annual cost-of-living adjustments and final salary calculations.
If you are a federal worker considering retirement, understanding the OPM’s annual workload cycle is crucial. And while the increase in applications might raise concerns about processing efficiency, the OPM has taken steps to handle the influx.
How OPM Prepares for its Annual Retirement Surge
If you want to retire in the new year but are hesitant because of potential OPM backlog and processing delays, it’s helpful to consider the steps taken by the OPM to help mitigate the effects of the surge.
In spring of 2023, the OPM published a quick guide to voluntary retirement to let federal employees know what to expect as their retirement applications are processed. In addition, the OPM also tasked agencies with implementing their own “quality assurance processes” to reduce application mistakes that result in long delays. This requires agencies to review retirement applications before sending them to OPM.
The good news is that the OPM retirement backlog recently reached its lowest level in six years. This happened twice in 2023 – in June and September – and highlights the improvements made, offering hope to potential retirees.
I’m Applying for Federal Disability Retirement – How Does This Affect Me?
If you’re a client of Harris Federal applying for Federal Disability Retirement, keep in mind that the OPM annual surge doesn’t affect your chances of approval. However, it’s important to note that there’s a chance you’ll experience delay due to the sheer number of submitted applications, even though the OPM has taken measures to help mitigate the backlog.
Regardless, the following Federal Disability Retirement benefits are well worth any wait:
- Retire early and receive a monthly payment until you reach your regular retirement age.
- Maintain your current health and life insurance policies.
- Receive additional years of creditable service on top of your current service.
- Work in the private sector and earn up to 80% of your old position’s current salary.
At Harris Federal, our goal is to educate federal employees about their benefits, especially Federal Disability Retirement and OWCP benefits. If you’re curious if you qualify or want to learn more, contact us today for a free consultation. We’re ready to expertly assess your eligibility for Federal Disability Retirement and chart a clear path forward.