What Is the FERS Annuity Supplement?
The FERS Annuity Supplement (also called the Special Retirement Supplement or SRS) is an additional monthly payment made to certain FERS retirees who retire before age 62. It is designed to bridge the income gap between your retirement date and when you can begin collecting Social Security.
How the Supplement Is Calculated
The supplement is calculated to approximate the Social Security benefit you earned while working as a federal employee. The formula is:
(Estimated Social Security benefit at age 62) × (Years of FERS service ÷ 40)
For example, if your estimated Social Security benefit at 62 is $1,800/month and you have 25 years of FERS service: $1,800 × (25 ÷ 40) = $1,125/month.
Who Qualifies?
To receive the FERS Annuity Supplement, you must:
- Retire with an immediate annuity before age 62
- Have at least 30 years of service at your MRA, OR 20 years of service at age 60, OR meet special provisions requirements
The Earnings Test
The supplement is subject to an earnings test. If you earn more than the annual exempt amount from employment (not investments), your supplement is reduced by $1 for every $2 you earn above the limit.
When Does It End?
The FERS Annuity Supplement ends when you reach age 62, at which point you become eligible for Social Security.
Planning Around the Supplement
The supplement can be worth $10,000-$25,000+ per year for many federal retirees. Proper planning around the earnings test and retirement date can maximize this benefit. Contact The Spivak Financial Group for personalized guidance.