Medical Retirement: Calculating FERS Disability Benefits

If you become disabled, you should probably take an instant FERS pension if you are a federal employee eligible for one.

Consider a disability retirement if you want to return to federal workers. We’ll examine how factors like age, years of service, and Social Security play into your FERS disability retirement calculation.

Office of Personnel Management (OPM)

You may be eligible for a medical retirement under FERS if you’ve worked for the federal government for at least 18 months. OPM will reject applications submitted outside of these windows. But first, you must give your agency detailed medical proof of your condition, explaining how it prohibits you from carrying out your current responsibilities.

In return, your employer must attest that it “made every effort” to keep you productively employed. Once the agency has certified that it was unable to do, then either they:

• Provide (reasonable) accommodation for the medical condition; or
• Reassign you to a different position with the same salary. You will be entitled to transfer to another place within the agency in the same locality.

After that, you can start the SF-3107 retirement application under FERS disability and the SF-3112 support documentation from OPM.

The FERS Disability Calculation

When determining eligibility for disability benefits under FERS, the age of 62 is a critical factor. At age 62, the FERS computation is identical to the immediate retirement calculation.

For those with less than twenty years of service but more than five, the pension is determined by multiplying the years worked by the high three salaries and then adding one percent. Twenty or more years of federal service earn a multiplier of 1.1%, which increases the base by 10%.

There is, of course, absolutely little relevance to the topic of disability there. All federal employees who have less than five years of service and are 62 or older can apply for medical retirement. If you become disabled and have at least 18 months of service, you will still be eligible for a FERS annuity, and the computation will remain the same (with the 1% multiplier).

For those under 62 years old, the rules governing FERS disability are different. First and foremost, you must apply for Social Security disability benefits before filing your OPM disability retirement application.

Even if your application for Social Security benefits is denied, you may still be eligible for FERS compensation. However, if you decide to withdraw your Social Security disability claim, OPM will also reject your SF-3107 for FERS compensation.

You may be able to keep receiving part or all of your FERS disability payments even if you go back to work. So long as your new salary is no more than 80% of what it was before you took medical retirement.

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Bio:
Mark, a lifelong Tulsan graduated from Westminster College, Fulton, Missouri with a Bachelor of Arts in Accounting. Mark served in the United States Army as a Captain in the 486th Civil Affairs BN. Broken Arrow, Oklahoma and retired in 1996. Mark is married to his high school sweetheart Jenny and has four beautiful children. Mark’s passion for his work, which includes over 20 years in the Financial Industry started as an Oklahoma State Bank Examiner. Mark examined banks throughout Oklahoma gaining a vast knowledge and experience on bank investments, small business and family investments. Mark’s experiences include being formally trained by UBS Wealth Management, a global investment firm where he served as a Financial Consultant specializing in Wealth Management for individuals & families. Mark is a licensed Series 24 and 28 General Securities Principal and an Introducing Broker Dealer Financial Operations Principal. Additionally, Mark is a Series 7 and 66 stockbroker and Investment Advisor focusing on market driven investments for individuals, businesses and their families. Mark specializes in providing financial knowledge, ideas, and solutions for federal employees, individuals, families and businesses. We serve as your advocate, and assist you in the design and implementation of financial strategies while providing the ideas to maximize your security and wealth. Our goal is to give you maximum control of your financial future. We provide the expertise to help you with personal issues such as: practical tax Ideas, risk management, investment solutions, and estate preservation. Additionally, we’ve counseled hundreds of employees on their transitions from careers in federal government, and private industry to their next life stage, whether that is retirement or a second career. We specialize in devising strategies that roll your TSP, 401(k), pension plan, to a suitable IRA to meet your objectives.

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