Government Executive - Pay & Benefits

Reliable rules for your retirement recordkeeping

Tammy Flanagan — Thu, 03 Sep 2026 15:00:00 -0400

This is an update to an article I wrote last year (and the year before) that provides tips and resources to transition from employee to annuitant and to catch up on some of the retirement planning that should have, but maybe didn’t, begin when you started your career.

Here are some crucial tips for every stage of your federal career:

Understand the parts of the Federal Employees Retirement System (FERS)

FERS An Overview of Your Benefits

FERS Information

Learn about your Minimum Retirement Age (MRA)

Service Credit

You know how long you’ve been a federal employee, but is there sufficient evidence of your career so that service may be credited towards your retirement eligibility and calculation? Be sure that there is documentation of your prior federal civilian and military service in your electronic Official Personnel Folder (eOPF) or paper OPF. If documentation is missing, let your retirement specialist know so that it can be retrieved and included in your service history for leave accrual and future retirement eligibility and computation.

In today’s climate where every federal employee is on alert for early retirement offers and, in some cases, the “pink slip” of an involuntary separation, it is important to take responsibility for gathering copies of the records that prove your beginning and ending dates of federal and military service, your retirement coverage, and work schedule.

If your agency isn’t as responsive as you would like, try to learn more about service credit by reading and attending available training. Here are some places to begin:

Office of Personnel Management YouTube: Retirement Counseling Tips

Office of Personnel Management YouTube: Quick Guide to Retirement Processing

Office of Personnel Management YouTube: Navigating Federal Retirement: How to Register for a Login.gov Account through Services Online

Consider paying a deposit into FERS for military service, non-covered civilian federal employment performed before 1989 (civilian service not covered by FERS deductions after 1988 is not currently creditable), and any refunded FERS contributions that you may have if there was a break in your federal career allowing you a return of your retirement contributions.

Understand the value of your sick leave and annual leave

Sick leave is your “short-term disability” protection. Treat it like “gold!” You earn four hours per pay period which translates to six months of paid time off after 10 years and a full year of paid time off after 20 years of federal employment.

Unfortunately, sick leave does not add much value to your retirement benefit – only 1/12 of 1% (or 1.1%) of your high-three average salary per year. For example, if you have a high-three of $100,000, 1 month of sick leave would add 1/12 of $100,000 x 1% or $83/year or about $7/month… where using that 1 month of accrued leave would be worth around $48 x 22 workdays x 8 hour/day = $8,448. Plus you would earn a little more annual and sick leave at the same time! If you need to use your sick leave and you have retirement coming up in your near future, then it is OK to use it if you have a valid reason to use it. Otherwise, be thankful you were healthy! It hasn’t been that long that FERS retirement received any credit for unused sicvk leave towards retirement calculation credit… so there’s that! It has only been for about the last 13 years: 50% Credit was applied to retirements with an annuity starting date from Oct. 28, 2009, through Dec. 31, 2013 and 100% Credit was implemented for all retirements starting on or after Jan. 1, 2014.

Know the rules for using your leave:

Fact Sheet: Annual Leave (General Information): An employee may use annual leave to establish initial eligibility for retirement in reduction-in-force (RIF) and other restructuring situations. An employee who has received a specific notice of termination in a RIF situation may use annual leave past the date the employee would otherwise have been separated to establish initial eligibility for immediate retirement, including discontinued service or voluntary early retirement.

Fact Sheet: Sick Leave (General Information): Unused sick leave will be used in the calculation of an employee's or survivor's CSRS or FERS annuity based on retirement with an immediate annuity or on a death in service.

Update your designation of beneficiary

Unpaid Compensation SF 1152: (Last paycheck, allowances and reimbursement for things such as unused annual leave, and anything else that is owed to an employee from the agency upon the death of a federal employee)

Federal Employees Group Life Insurance SF 2823

Reporting a death/FEGLI Death Claims

Federal Employees Retirement System or Civil Service Retirement System SF 3102 This does not determine any recurring benefits such as a survivor annuity for a spouse or a child. This benefit consists of the deceased's retirement contributions, plus any applicable interest, in the Civil Service Retirement and Disability Fund.

Chapter 75, CSRS and FERS Handbook, Lump Sum Benefits

Office of Personnel Management Survivor Benefits

Thrift Savings Plan: To designate a beneficiary or beneficiaries, log in to My Account on tsp.gov or use one of the Thrift Line Service Center options listed in the Death Benefits booklet. Remember that once you select a beneficiary(ies), you cannot cancel and return to the order of precedence. You will only be able to designate a new beneficiary. If your spouse inherits your TSP account, they will have a TSP Beneficiary Account set up for their inherited funds.

Understand how the TSP works

Online Learning Opportunities: The TSP offers free recorded webinars, live webinars, and other scheduled training which cover many topics for TSP participants and their beneficiaries. These learning opportunities are hosted by the Federal Retirement Thrift Investment Board (FRTIB).

How Does Compound Interest Work? By Mark Catanzaro, St. Louis Federal Reserve Bank: Learn about the Rule of 72 and learn about how inflation affects purchasing power of money. This should always be considered when reviewing long-term projections. For instance, the purchasing power of $787,180 today would be approximately $434,580 in 30 years, assuming a 2% average inflation rate.

Core Funds vs. L Funds vs. Mutual Fund Window

Set up your “My Social Security” account with LOGIN.GOV: This account will let you access your earnings record, age-appropriate information about Social Security benefits and estimates of the benefits you are earning.

Leaving federal service early:

Leaving early might mean giving up lifetime FEHB coverage, life insurance, and credit for unused sick leave toward your retirement computation.

A deferred retirement is paid later when a federal employee is not entitled to an immediate retirement benefit, however, you must have a minimum of five years of creditable civilian federal service to qualify for any retirement benefit. A deferred annuitant is not entitled to the FERS Special Retirement Supplement to hold you over until you qualify for Social Security at age 62. When contemplating a move to the private sector, consider and compare workplace flexibility; leave policies and accrual; retirement benefits, insurance options; and of course, salary.

If you make the decision to leave:

Consider keeping your FERS retirement contributions on deposit to allow a deferred retirement benefit that is payable later if you have at least five years of creditable civilian federal employment.

Consider keeping your retirement savings in your TSP account if you leave federal service when you are at least 55 in the year of your separation from federal employment to avoid early withdrawal penalties that may apply from an IRA when you make withdrawals before age 59 ½. If you separate before the year that you reach age 55, be aware of the potential tax penalties for early withdrawal unless you meet one of the other exceptions as described in the TSP Tax Rules About TSP Payments publication.

You may continue your FEHB coverage for up to 18 months following your separation (this is called Temporary Continuation of Coverage comparable to COBRA in the private sector). Under TCC, you will pay the employer and the employee share of the premium.

Be sure to use up your flexible spending account dollars before you leave. The balances in your Health Care FSA (HCFSA), Limited Expense Health Care FSA (LEX HCFSA) and Dependent Care FSA (DCFSA) are treated differently if you separate before the end of the calendar year.
- Your HCFSA or LEX HCFSA will terminate as of the date of your separation or retirement. There are no extensions. Any eligible health care expenses incurred prior to the date of separation will still be reimbursed but those incurred after the separation date are not reimbursable, even if you accelerated your allotments. If you used your entire elected amount before FSAFEDS has deducted it from your pay, you will not be responsible for the remaining allotments.
- Your DCFSA remaining balance can continue to be used to pay for eligible dependent care expenses until your account balance is depleted or the end of the calendar year, whichever comes first.

Retirement Sooner than Later:

Make sure you are on track with your savings (review the TSP tips for new hires)

Learn the pros and cons of a TSP Loan before you apply for one.

Try saving for big items such as a car, vacations, and other major outlays rather than using credit or loans.

Update your designation of beneficiary forms

The TSP allocation you have could be too conservative

The TSP allocation you have could be too aggressive (or not aggressive enough)

Begin to project your retirement benefits payable at your MRA, age 60, and at age 62.

At your MRA, you may find that you are eligible for either a reduced MRA + 10 benefit or an unreduced immediate retirement benefit with a supplemental payment to help you retire earlier than age 62. Although you may be eligible to retire, can you afford to retire?

At age 60, you will only need 20 years of creditable service to retire with an unreduced, immediate retirement benefit, and be entitled to a FERS Special Retirement Supplement to age 62.

Age 62 is worth considering for a variety of reasons:

To be eligible for an immediate retirement at age 62, you only need five years of creditable civilian service covered by FERS.
If you have 20 years of creditable service (including credit for unused sick leave), you will qualify for a higher computation factor for your benefit resulting in a ten percent increase just for have 20 or more years of service (and being 62 or older),
Cost of living adjustments for most FERS retirees begin at age 62. Remember that if you retire before 62, your retirement under FERS (and the FERS Supplement) will not increase until you turn 62 years old. Exceptions for special groups such as law enforcement officers and firefighters retiring under FERS along with disability annuitants and survivor annuitants.
At age 62, you are now eligible for Social Security retirement benefits which will be more than the FERS Supplement because they will be based on your lifetime of Social Security covered employment rather than only your civilian service covered by FERS. Social Security benefits are adjusted annually for inflation.

To Do List:

Run the numbers
- Compute your FERS Basic Retirement Benefit (or have your HR office do it for you). Consider reductions for survivor elections, former spouse apportionments and survivor benefits, age reduction for MRA + 10 option, and proration of the benefit if you ever worked part-time. Be sure to review your service history and be sure that all the time is creditable for the calculation of your retirement.
- Your retirement benefit will also be subject to monthly withholdings for federal and state income tax (not all states tax federal retirement benefits, however), and insurance (FEHB, FEGLI, FLTCIP, and FEDVIP).
- If you are going to file for Social Security retirement, get an updated estimate at www.ssa.gov. Your benefit will be partially taxable on the federal level and there are about six states that also tax SSA benefits.
You can prepare the Application for Immediate Retirement, SF 3107, https://www.opm.gov/forms/pdf_fill/sf3107.pdf before you begin the Online Retirement Application. This will help you understand the decisions you will need to make and the documents you may need to upload into the ORA System. If available, set up pre-retirement counseling to ask questions, review your estimated benefits, and learn how your agency processes your retirement.
- Become familiar with the new Online Retirement Application: https://retire.opm.gov/portal
- SF 2818 Continuation of Life Insurance (FEGLI)
- Fact Sheet: Lump Sum Payment for Annual Leave
- Retirement Facts 8: Credit for Unused Sick Leave Under the Civil Service Retirement System (also applies to FERS)
The health plan you are in may not be the best health plan for retirement. This is especially true if you enroll in Medicare Part B once you have retired. FEHB plans wrap around Medicare nicely so you can avoid most out-of-pocket expenses (deductible, copays, and coinsurance). It pays to compare your current coverage with plans that offer incentives to enroll in Medicare. Members of the National Active and Retired Federal Employees Association have access to a series of webinars that can help you understand and choose the best plan for you. In addition, the Checkbook Guide to Federal Health Plans can provide comprehensive information for employees and retirees during open season.
- Retirement is not a Qualifying Life Event, however if you move outside of your FEHB plan’s service area or if you are 65 or older, you can use a QLE to change plans outside of open season. See a list of all QLEs on form SF 2809 or OPM Form 2809.
Make copies of everything that you fill out before you turn in your applications.
Brush up on tax information
- W-4P Withholding Certificate for Periodic Pension or Annuity Payments
- IRS Publication 721 Tax Guide to U.S. Civil Service Retirement Benefits
- Tax Rules About TSP Payments, TSP Publication 26
- Request to withhold taxes from your Social Security benefit

Be sure to have six months of living expenses in the bank before you retire to allow for delays in processing your benefits.
Update your designation of beneficiary forms (see above) Information for FERS Annuitants
When you receive your CSA (Civil Service Active) number from the Office of Personnel Management, it is time to set up your Services Online account. This will allow you to make changes such as updating your address, electing federal and state tax withholding, view your annuity statement and more.
Learn how to manage your TSP account in retirement
The TSP allocation you have could be too conservative
The TSP allocation you have could be too aggressive
Consider the options for distribution of your TSP account
TSP Distribution Booklet
Withdrawing Your TSP Account after Retirement
- One option for a TSP distribution is to purchase a TSP life annuity through the TSP vendor. To compute an estimate of this, use the TSP annuity calculator. The current TSP Annuity interest rate index factor is 5.075% up from 4.95% in August. The historical rates can be found here: https://www.tsp.gov/withdrawals-in-retirement/historical-annuity-rates/ Learn about this option in the TSP Annuity Fact Sheet.
- Other, more flexible options include requesting monthly, quarterly, or annual installment payments directly from your account; partial payments, as needed; and you may also transfer some or all your TSP to an IRA.
- Make sure that your address is current with the TSP and be sure to enter your bank information by accessing your account at www.tsp.gov. This will make your withdrawals go smoother and take less time to process.
- For your protection, the destination you wish to send your TSP payment to must be on file for at least seven days before it can receive funds. This includes any postal address or any direct deposit information you’ve entered. Make sure this information is on file for at least seven days before you start your request. Lost, stolen, damaged, or misdirected checks can take six weeks or longer to replace.

All the best to those of you who are getting ready to complete your career of dedicated federal service and move into the next chapter of your career or your retirement life!

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TSP funds were back in the black in August

Erich Wagner — Tue, 01 Sep 2026 16:47:30 -0400

Each portfolio within the federal government’s 401(k)-style retirement savings program gained value last month, snapping a two-month streak of lackluster market performance.

The international stocks of the Thrift Savings Plan’s I Fund sported the best performance, gaining 3.32% last month. So far this year, the I Fund has grown 19.18%.

The C Fund, which is made up of large- and mid-size businesses, increased 2.72% in August, good for 13.12% growth since the start of 2026. And the small- and mid-size companies in the S Fund finished August 2.27% in the black, bringing its 2026 gains to 16.10%.

The fixed income (F) fund grew 0.40% last month, reducing its 2027 losses to 0.16%. And the G Fund, which grows at a statutorily mandated rate, gained 0.41% in August. So far this year, the G Fund has grown 3.00%.

Likewise, each of the TSP’s lifecycle (L) funds, which move toward more conservative investments as participants get closer to retirement, gained value in August. The L Income Fund, designed for those already making withdrawals, grew 1.11%; L 2030, 1.75%; L 2035, 2.04%; L 2040, 2.31%; L 2045, 2.31%; L 2050, 2.43%; L 2055, 2.85%: L 2060, 2.86%; L 2065, 2.86%; L 2070, 2.85%; and L 2075, 2.86%.

Since January, the L Income Fund has increased 6.34%; L 2030, 9.78%; L 2035, 11.15%; L 2040, 11.87%; L 2045, 12.50%; L 2050, 13.14%; L 2055, 15.57%; L 2060, 15.57%; L 2065, 15.57%; L 2070, 15.56%; and L 2075, 15.56%.

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Trump’s 2027 pay freeze has unions warning of recruitment, retention problems

Erich Wagner — Mon, 31 Aug 2026 17:06:45 -0400

Organizations representing federal employees and their allies in Congress in recent days have decried President Trump’s plan to freeze most federal workers’ pay while directing sizeable raises for federal law enforcement and members of the military.

Last week, Trump issued an alternative pay plan formalizing the call from his fiscal 2027 budget proposal to freeze most federal workers pay at 2026 levels next year. He also announced that he would direct the Office of Personnel Management to authorize a 3.8% increase in basic pay for federal law enforcement officers, to go along with a between 5 and 7% raise for military service members, depending upon their rank.

But unions and professional associations warned denying most feds a raise next year could exacerbate recruitment and retention crises at several agencies. Following the Trump administration’s push to cut down on federal headcounts last year, including through mass firings and encouraging early retirement and buyout programs, the non-postal federal civilian workforce fell below 2 million employees this year for the first time since the 1960s, per June data from the Office of Personnel Management.

“This is a slap in the face to the dedicated civil servants who keep our nation running and will make it harder for federal agencies to recruit and retain essential employees,” said Everett Kelley, national president of the American Federation of Government Employees. “For years, wages for federal employees haven’t kept pace with rising costs for housing, food, utilities and other essentials. Private-sector workers currently earn 27% more on average than federal employees doing the same job. To add insult to injury, the administration is asking for special approval to pay hundreds of employees ‘requiring an extremely high level of expertise’ up to $400,000 a year—equal to the president’s base salary—even as it denies workers a basic cost-of-living raise.”

Kelley referred to recently finalized regulations granting OPM greater authority to OK critical position pay that could allow up to 400 positions to earn more than double the current General Schedule pay cap of $197,200 per year.

William Shackelford, national president of the National Active and Retired Federal Employees Association, said that when coupled with inflation and a likely increase to health insurance premiums through the Federal Employees Health Benefits Program next year, a pay freeze is effectively a pay cut.

“This ‘more work for less pay’ policy will only drive the most valuable employees out of federal service, costing Americans in degraded services—from care to veterans to law enforcement and support for our military, wasteful spending due to inadequate management of government contracts and grants, less reliable information and more,” he said. “[Pay] decisions do not only affect current employees—they reach into retirement, too. Annuities are based on high-3 average salary, so a freeze affects the value of future retirement pay as well as today’s paychecks.”

And Dave Spero, national president of the Professional Aviation Safety Specialists, a union representing Federal Aviation Administration workers who install and maintain air traffic control and other aviation safety equipment, said a pay freeze could jeopardize agency efforts to hire hundreds of new technicians.

“The FAA’s workforce plan to hire an additional 750 technicians just became that much more difficult,” he said. “Aviation safety inspectors and other critical employees will begin to retire and the recruitment of these aviation safety professionals will suffer . . . These employees maintain and oversee the largest, safest and most complex air traffic control system in the world. Dismantling it by destroying the morale of the employees is heartbreaking.”

Rep. Steny Hoyer, D-Md., accused the administration of trying to “drive hardworking public servants out” of agencies, and vowed to fight for Congress to override the president’s plan.

“Last week’s announcement that civilian federal workers will not be receiving an annual cost-of-living adjustment for 2027—even while military and law enforcement personnel are given as high as a 7% raise—will only further reduce morale and retention at agencies and make it harder to recruit the best and brightest to serve,” he said. “I’m proud to represent more than 75,000 civilian federal employees in Maryland’s Fifth District, and I will continue to fight this administration’s efforts to denigrate them and deny them the pay and benefits they are due.”

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Trump formally proposes pay freeze for most federal workers, 3.8% increase for law enforcement

Erich Wagner — Fri, 28 Aug 2026 15:44:04 -0400

Most federal employees would see their pay frozen at 2026 levels next year under an alternative pay plan issued by President Trump this week, though for the second straight year, federal law enforcement officers would receive a 3.8% increase.

Trump first proposed the pay freeze as part of his fiscal 2027 budget proposal. Though the document was silent on federal employee compensation, officials with the Office of Management and Budget quickly clarified that its omission equated to a planned freeze for 2027.

In a letter to House Speaker Mike Johnson, dated Thursday, Trump said increasing most federal employees’ pay would be “unacceptable and unfair” given the inflation that occurred under the Biden administration. Inflation actually has risen from 2.8% when former President Biden left office to 3.3% as of last month.

“I have therefore decided to set at zero the pay adjustment to be made for the 2027 pay year,” Trump wrote. “This decision will maintain fiscal responsibility without harming the government’s ability to recruit and retain well qualified employees.”

But in the next paragraph, Trump said that for the second straight year, he instructed the Office of Personnel Management to issue a 3.8% increase in basic pay to federal law enforcement personnel next year, “to increase recruitment and retention” in those roles.

The issuance of a pay freeze would mark a departure from last year, however. While Trump proposed a pay freeze as part of his fiscal 2026 budget, ultimately he elected to institute a 1% across-the-board raise for non-law enforcement federal workers last August.

Alternative pay plans have been a routine exercise across Democratic and Republican administrations. Presidents have until the end of August to issue those proposals, else much larger increases to locality pay would automatically take effect, due to the 1990 Federal Employees Pay Comparability Act.

Congress may override the president’s proposal, typically as part of appropriations legislation. Though the House’s spending bills are silent on federal employee compensation—effectively endorsing Trump’s plan—the Senate has yet to unveil its draft of the spending package that typically serves as the vehicle for pay raises.

In early 2019, the newly Democratically controlled Congress successfully overrode Trump’s plan to freeze federal worker pay that year, ultimately instituting a 1.9% average pay raise retroactive to the beginning of that year.

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Want to retire at the end of 2026? Start planning now

Tammy Flanagan — Thu, 27 Aug 2026 15:00:00 -0400

If you're planning to retire at the end of 2026, it's time to get busy preparing. End-of-year retirements are popular, especially for federal employees who are saving annual leave for a large lump-sum payout in 2027.

The Office of Personnel Management continues to process a historically high volume of retirement claims, and while digital submissions are improving processing efficiency, overall claim inventories are still above target levels. This is why early preparation helps during the transition from employee to annuitant.

Employees can reduce potential delays by confirming service records, reviewing benefit elections, preparing financially for the transition period and submitting retirement paperwork early through their agency's recommended process.

Some recent retirement processing numbers:

In July 2026, OPM processed 14,370 digital claims and 3,471 paper application packages. By comparison, in January 2026, OPM processed 6,465 digital applications and 9,106 paper applications.

The 2025 Deferred Resignation Program contributed to the 2026 surge. Large numbers of employees left federal service under the DRP, creating delays for payroll providers and human resources offices responsible for initial retirement processing.

As of the end of July 2026, OPM still had 24,784 claims awaiting adjudication, above its goal of 13,000 or fewer pending claims. Although the inventory has improved from a high of 65,237 claims in February 2026, processing times remain a key consideration for employees planning a year-end retirement.

Checklist to get ready

1. Build a cash reserve for the transition.

Your final paycheck should arrive within a few weeks of retirement, and your lump-sum annual leave payment usually follows soon after. However, timing can vary.

Interim retirement payments may begin within 6 to 8 weeks, while final adjudication may take several months. In July 2026, digital claims averaged about 98 days from receipt at OPM, while paper claims averaged 156 days.

It is not clear whether those are 22-day work months or 30-day calendar months, but either way, these are only "averages."

2. Confirm that your records and paperwork are complete.

Verify that your federal service is fully documented in your eOPF, including appointment dates, work schedule changes and retirement coverage changes.

Keep copies of key records in your personal personnel file.

Confirm whether any military service credit deposits are complete.

Verify that all service is creditable for retirement eligibility and computation before setting your retirement date.

3. Update beneficiary designations for CSRS or FERS, TSP and FEGLI.

4. Review survivor benefit elections.

If applicable, consider spousal survivor benefit options before submitting your retirement application.

5. Confirm FEHB eligibility.

Remember, you must be "covered" by FEHB (or PSHB) for the five years immediately preceding your retirement date. You also must be retiring with immediate retirement eligibility.

6. Determine whether a former spouse is entitled to benefits.

If applicable, review your divorce decree or court order. Include a copy with your retirement application if benefits are payable to a former spouse.

7. Review life insurance needs.

Consider your FEGLI coverage and review the Continuation of Life Insurance form, SF 2818

Additional information is available from OPM's life insurance resources

8. Give sufficient notice and begin the application early.

OPM advises employees to contact their employing agency about recommended submission timeframes. Agencies generally need at least 60 days to process a retirement application before sending it to OPM, but some agencies may require more time.

9. Final retirement estimate

Do you understand the numbers on this estimate? If not, ask questions to be sure.

This is an "estimate." OPM is responsible for the final numbers. Be sure to receive a final retirement estimate and be sure that you understand and agree with the dates and numbers.

10. Understand the difference between paper and digital applications.

Paper applications: Employees complete the Application for Immediate Retirement, SF 3107 for FERS or SF 2801 for CSRS. HR reviews the application, completes the Certified Summary of Federal Service, which you will need to sign and return, and submits the package through payroll to OPM.

Digital applications: When an employee notifies HR of a retirement date, HR sends an invitation to access the Online Retirement Application system. HR and payroll review and complete their portions before electronically releasing the application to OPM.

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Life happened. Now what about your retirement benefits?

Tammy Flanagan — Thu, 20 Aug 2026 15:00:30 -0400

Retiring from federal service is a major milestone, of course, but it does not end the need to understand how federal benefits work. In the years after retirement, life events and new opportunities can raise important questions about insurance, survivor benefits, beneficiary designations and the effect of returning to government employment.

Today I will highlight several post-retirement issues that federal employees may want to plan for in advance. This is not an all-inclusive list, but it’s a list that will hopefully remind you that it is important to review your benefits and be sure to understand how they can change as life goes on.

The topics included today are the FEGLI Living Benefit, reemployment in federal service after retirement, changing beneficiary designations, marrying after retirement and providing benefits to a new spouse, and understanding how CSRS or FERS retirement benefits may change over time.

The FEGLI Living Benefit

The FEGLI Living Benefit is one that we hope that we will never need, but it can be very important to the person who is entitled to it.

This benefit allows an eligible employee, annuitant, or compensationer (a person receiving benefits from the Office of Workers’ Compensation Programs as a result of a work-related injury) enrolled in FEGLI Basic life insurance to receive a lump-sum payment while still living if the person is terminally ill and has a documented medical prognosis showing a life expectancy of no more than nine months. This payment can provide important financial flexibility at a difficult time.

It may help pay for medical costs, in-home care, family travel, household expenses, debt, or other needs that arise when an employee or retiree is facing a serious illness and may no longer be able to work or manage expenses in the usual way.

Using the Living Benefit also affects the people who would otherwise receive the FEGLI Basic insurance after the insured person’s death. The Living Benefit is an advance payment of Basic insurance, so any amount paid while the insured person is living reduces, or may eliminate, the Basic insurance payable to beneficiaries later.

Employees may be able to elect a full or partial Living Benefit, while annuitants and compensationers may elect only a full Living Benefit. A full election generally means there will be no remaining Basic insurance payable to beneficiaries after death, although any FEGLI Optional insurance remains separate and is not reduced by the Living Benefit election.

Although premiums may end for the amount covered by the Living Benefit, the individual must continue to pay premiums for any option coverage remaining.

The Living Benefit is not subject to federal income tax. According to the U.S. Office of Personnel Management, these payments are tax-free at the federal level, though you should still check your specific state laws since a few states treat them differently.

Because the decision is irrevocable and directly affects both current cash flow and survivor protection, it should be considered carefully with family members, beneficiaries, and financial or tax advisers.

For example, suppose a federal retiree with FEGLI Basic coverage is diagnosed with a terminal illness and elects to receive the full Living Benefit. The lump-sum payment could help the retiree pay for uncovered medical expenses, arrange additional care at home, or reduce financial pressure on family members.

However, because the Basic insurance has been paid in advance, the retiree’s beneficiaries should understand that little or no Basic insurance may remain payable after death, depending on the election made.

Reemployment in federal service after retirement

Some retirees later return to federal employment as reemployed annuitants. In many cases, the retiree’s existing CSRS or FERS annuity continues during the period of reemployment, but the new federal salary is reduced, or offset, by the amount of annuity that applies to the time worked.

This means the retiree usually does not receive both a full annuity and a full salary at the same time unless a specific exception or dual compensation waiver applies. The employing agency pays the reduced salary and sends the offset amount to the retirement fund, while OPM generally continues paying the annuity separately.

FERS retirees who are receiving the FERS annuity supplement should also understand that returning to work can affect that payment. The supplement is separate from the regular FERS basic annuity and is intended to approximate the Social Security benefit earned through FERS service until age 62.

After a retiree reaches the minimum retirement age, the supplement is subject to an earnings test. Wages or net self-employment income above the annual exempt amount ($24,480 in 2026) can reduce the supplement by $1 for every $2 earned over the limit, and high enough earnings can reduce the supplement to zero.

This rule applies even when the retiree returns to federal service as a reemployed annuitant, including situations involving a dual compensation waiver; the waiver may affect salary offset rules, but it does not by itself exempt the FERS supplement from the earnings test.

Reemployment can also allow an increase to future retirement benefits if the period of service is long enough and retirement deductions are properly withheld or deposited. A supplemental annuity may be available after the annuitant completes at least one year of actual, continuous, full-time reemployment service, or the equivalent amount of part-time service.

If an annuitant is reemployed in a part-time position at a tour of duty less than 40 hours per week, for example, 20 hours per week, and if the annuitant works a total of 1,040 hours in a year (52 weeks x 20 hours), then the employee must work for two continuous years to be eligible for a supplemental annuity.

When the reemployment ends, the supplemental annuity is added to the retiree’s existing annuity rather than replacing it, giving the retiree an additional monthly amount based on the new period of federal service.

A redetermined annuity may be available after a longer period of reemployment, generally at least five years of actual, continuous, full-time service, or the part-time equivalent. Instead of simply adding a supplemental amount to the old annuity, a redetermined annuity is a new computation that considers all creditable service and the law in effect when the employee separates from reemployment.

The retiree must elect the redetermined annuity in place of the prior annuity and any supplemental annuity that otherwise would be payable. Because the rules can vary based on the type of retirement, appointment, retirement system, salary offset status, and whether a waiver applies, retirees should review the details with the employing agency and OPM before accepting reemployment and again before separating from the new position.

OPM has a new Benefits Administration Letter 26-104, titled Reemployed Annuitant Decision Tables, designed to detail the agency actions required for retirement coverage and benefits, health insurance, and life insurance for an annuitant upon appointment, separation, and death (if an annuitant dies during reemployment).

Changing beneficiary designations after retirement

Beneficiary designations determine who receives certain benefits, such as life insurance proceeds or retirement contributions or the final retirement payment, after a retiree’s death. Because family circumstances can change after retirement, retirees should periodically review and update their designations to make sure benefits are paid according to their current wishes.

Outdated forms can lead to unintended results, especially after marriage, divorce, the death of a beneficiary, or changes in family relationships. An easy way to do this is to file new designation of beneficiary elections which will supersede any that have been previously filed.

Different federal benefits have different designation of beneficiary forms, so retirees should be careful not to assume that one designation controls every benefit. For FEGLI life insurance, the beneficiary form is SF 2823, Designation of Beneficiary, Federal Employees’ Group Life Insurance Program. SF 3102 is the Designation of Beneficiary form for federal employees and retirees under both the Civil Service Retirement System (CSRS) and the Federal Employees Retirement System (FERS).

You can download these forms directly from www.opm.gov/forms. These forms are separate from any survivor annuity election, which is governed by different rules.

Annuitants should send the completed SF 3102 and SF 2823 to the U.S. Office of Personnel Management Retirement Operations Center at P.O. Box 45, Boyers, PA 16017-0045. The forms must reach OPM before your death to be legally valid.

TSP beneficiary designations are handled separately through the Thrift Savings Plan. Retirees can add or update TSP beneficiaries by logging in to My Account at TSP.gov; TSP also explains that the designation must be on file with TSP at the time of death and that a will or other document will not control the TSP account.

Because beneficiary designations can override expectations after events such as divorce, remarriage, or the death of a beneficiary, retirees should review FEGLI, CSRS or FERS, and TSP designations whenever their family or estate-planning situation changes.

Marriage after retirement and benefits for a new spouse

Marriage after retirement can create new questions about survivor benefits and continued access to federal benefit programs for a new spouse. If a retiree marries after leaving federal service, the retiree may elect a reduced annuity to provide a survivor annuity for the new spouse, but the election generally must be made in writing to OPM within two years of the date of marriage.

This election is separate from changing beneficiary designations and is important because, without a survivor annuity election, a new spouse generally will not receive a continuing monthly CSRS or FERS survivor benefit after the retiree’s death.

OPM will provide the retiree with form RI 20-63, Survivor Annuity Election for a Spouse, which will include the option of choosing the maximum amount available or an amount that will provide a survivor annuity of a specific dollar amount (no more than the maximum survivor annuity benefit).

OPM will also include a letter outlining the cost associated with this election and directions on how to respond within the two-year deadline for this election. It is important to contact OPM after you remarry and well before the expiration of the two-year deadline so that you have time to consider your options.

In addition to the regular survivor annuity reduction, a post-retirement election for a new spouse generally requires a permanent actuarial reduction. OPM describes this reduction as the difference between the annuity already received without the survivor election and the amount that would have been paid if the survivor election had been in effect since retirement, plus 6% interest.

This actuarial reduction is spread over the retiree’s lifetime and continues even if the marriage later ends, so retirees should ask OPM for a cost statement and carefully review the effect on their monthly income before confirming the election.

A new spouse may also be added to FEHB coverage because marriage is a qualifying life event. A retiree who is enrolled in FEHB may generally change to a family enrollment or self plus one enrollment during the permitted qualifying life event window, beginning 31 days before marriage and ending 60 days after marriage or doing a future open season.

Retirees should include this request when contacting OPM regarding the remarriage. Providing a survivor annuity is also an important election to allow FEHB coverage for your new spouse to continue if you predecease them.

Cost-of-living adjustments to maintain your buying power

The purpose of cost-of-living adjustments (COLAs) for federal retirees is to protect the fixed retirement income CSRS or FERS retirement benefit from the impact of inflation that can erode the buying power as the costs of goods, services, and medical care rise over time.

The retirement benefit COLA automatically adjusts annuity payouts using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) measured during the third quarter of the year.

The CSRS receives the full calculated COLA matching the measured rate of inflation, while the FERS benefit often receives a modified or capped COLA (e.g., if inflation exceeds 3%, the FERS increase is typically 1% less than the CPI increase) and generally does not kick in for regular retirees until the Minimum Retirement Age (MRA), which is 57 for retirees born in 1970 and later and between 55 and 57 for retirees born earlier.

The “offset” for CSRS Offset retirees and survivor annuitants

CSRS Offset retirees and survivor annuitants should also understand that their civil service annuity may be reduced when Social Security entitlement begins or would begin upon proper application. For retirees, OPM generally determines the offset around age 62, or at retirement if the retiree is already over age 62, and reduces the CSRS annuity by the portion of Social Security attributable to CSRS Offset service.

A CSRS Offset survivor annuity is computed like a regular CSRS survivor annuity, but it may be reduced if the survivor is eligible for Social Security benefits based on the retiree’s federal service.

In cases where the survivor annuity is reduced because of the survivor annuitant’s own “earned” Social Security retirement benefit, the offset may be reduced or eliminated. It is important for survivor annuitants to understand this since OPM may not always be aware of the survivor annuitant’s earned Social Security benefit amount.

See previous Government Executive articles, A Rude Annuity Shock and Sometimes, Your Benefit Really Is Too Small, to learn more about this situation.

Health benefits and life events

Health benefits can also change after retirement, not only the premiums and the benefits, but your needs may change over time. Outside of open season, FEHB changes generally must be tied to a Qualifying Life Event (QLE), such as marriage, divorce, death of a family member, or a move out of a plan’s service area, and many changes must be requested within 60 days of the event.

Annuitants should confirm the effective date with OPM because the timing can depend on the type of change. For example, some enrollment decreases may be made at any time and are commonly effective at the beginning of the month after OPM receives the election, while other changes follow the qualifying life event rules.

There is a little-known option to change insurance just because you have reached age 65, it is QLE 2L. This is your “ace in the hole” that you can only use once in your lifetime to change plans outside of open season.

This is generally used to change plans when enrolling in Medicare after retirement, but if not used at age 65, it can be used later – but only once!

Restoration of a reduced CSRS or FERS annuity

If a spouse or former spouse dies and the retiree’s CSRS or FERS annuity is being reduced to provide a survivor annuity for that person, the retiree should notify OPM and provide the required proof, such as a death certificate or marriage certificate in the case of a former spouse who remarries before age 55.

OPM may then increase the retiree’s annuity by removing the survivor reduction, restoring the annuity to the unreduced amount prospectively.

Retirees who divorce should also notify OPM promptly. If the marriage ends by divorce, the survivor reduction may be removed. However, as is often the case, a court order may require the retiree to continue providing a former spouse survivor benefit.

In a divorce, not only are survivor annuity benefits sometimes continued for the former spouse, but divorce can also create continuing rights for a former spouse to a portion of your retirement, often referred to as the “marital share.”

Court orders may also require assignment of FEGLI to the former spouse and require continuation of health benefits for the children of the marriage. There are also Temporary Continuation of Coverage (TCC) and Spouse Equity benefits available for a former spouse to continue health benefits coverage.

Because OPM must follow clear and specific court orders and will not rewrite unclear terms, retirees should make sure any divorce order addresses federal retirement, survivor, health benefits, and life insurance issues with precision. Be sure that your attorney uses the language outlined in the Attorney Handbook.

Key takeaways for federal retirees

Review benefits after every major life event. Marriage, divorce, the death of a spouse or beneficiary, reemployment, or a serious illness can all change how federal benefits work.

Keep beneficiary designations current. FEGLI, CSRS, FERS, and TSP benefits are controlled by their own forms or account records, and a will may not override an outdated designation.

Do not assume a new spouse is automatically protected. A survivor annuity election, FEHB enrollment change, or other action may be required within a specific deadline.

Understand how income can change after retirement. COLAs, CSRS Offset reductions, survivor benefit reductions, reemployment salary offsets, supplemental annuities, redetermined annuities, and court orders can all affect monthly income.

Act promptly after divorce or the death of a spouse or former spouse. OPM may need documentation to adjust an annuity, restore an unreduced benefit, or apply a court order.

Check before relying on assumptions. Federal retirement, insurance, health benefits, and TSP rules can interact in ways that are easy to overlook, so retirees should contact OPM, TSP, or a knowledgeable benefits specialist before making decisions that affect current income or survivor protection.

Understanding federal benefits does not end on the day an employee retires. Retirement can bring new decisions about life insurance, beneficiary designations, reemployment, survivor protection, health benefits, and changes to CSRS or FERS annuity payments.

By reviewing these rules before a major life event occurs – and knowing when to contact OPM, TSP, or a former employing agency, retirees can make more informed decisions, avoid unintended consequences, and better protect themselves and their families throughout retirement.

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Bill expanding paid leave for feds is pared back in Senate

Erich Wagner — Mon, 17 Aug 2026 17:54:59 -0400

Legislation aimed at improving the amount of paid leave federal employees are eligible each year took another step forward as Democratic senators introduced companion legislation shortly before Congress left for its August recess.

In June, a bipartisan group of House lawmakers introduced the Comprehensive Paid Leave for Federal Employees Act (H.R. 9261), a measure that would provide feds with up to 12 weeks each year of paid family leave, to be used to attend to a serious health condition or care for a spouse, child or parent. It also would cover absences needed in connection with a family member’s deployment into active-duty military service, or to help a family member who has been the survivor of domestic violence, sexual assault or stalking.

And last month, Sens. Brian Schatz, D-Hawaii, and seven other Democrats introduced their own version of the bill (S. 5168). That measure also extends 12 weeks per year of paid family leave to federal workers to deal with a health condition or a family member’s health condition and to attend to a family member’s military deployment, but it excises the provision relating to victims of domestic violence, sexual assault and stalking.

“Right now, our laws are forcing federal workers to make the impossible choice between caring for their families and keeping their jobs,” Schatz said in a statement. “Our bill will provide federal workers with 12 weeks of paid leave, giving them the time they need to take care of their own health and their loved ones.”

Paid family leave and other provisions relating to federal workers has recently been a tougher sell for the Senate side of the U.S. Capitol. In 2019, as lawmakers considered providing 12 weeks of paid parental leave to federal workers each year via the 2020 National Defense Authorization Act, the House’s version of the legislation also included family leave, only for the Senate to balk during negotiations between the chambers.

Likewise, the House has included a provision blocking President Trump’s anti-union executive orders’ implementation at the Pentagon in both last year’s NDAA and the one currently under consideration. The Senate stripped the provision from their version of the bill last year.

Despite the more pared-back approach, the Senate’s family leave bill has still attracted the support of several unions and other federal employee associations.

“Expanding paid family and medical leave ensures federal employees never have to choose between caring for themselves or a loved one and serving the American people,” said Everett Kelley, national president of the American Federation of Government Employees. “This legislation will strengthen the federal workforce, improve employee retention, and help the government remain a competitive employer for the dedicated public servants our nation depends on.”

“Federal employees should never have to choose between caring for their loved ones and paying their bills on time,” said National Treasury Employees Union National President Doreen Greenwald. “The Comprehensive Paid Family Leave Act would provide federal workers with the flexibility and support they need during some of life’s most significant moments. As the federal government works to attract and retain talented public servants, providing comprehensive paid family leave is both the right thing to do and a smart investment in the workforce.”

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Lawsuit seeks to enforce 2025 SCOTUS decision improving pay for feds called to active duty

Erich Wagner — Thu, 13 Aug 2026 16:36:53 -0400

A Veterans Affairs Department employee filed a lawsuit against the Office of Personnel Management Wednesday seeking to force it to promulgate new regulations implementing a Supreme Court case opening up differential pay to more federal workers who simultaneously serve as military reservists that was decided more than a year ago.

In 2009, Congress enacted legislation aimed at ensuring federal workers are not forced to take a pay cut when they deploy to active duty as part of their service in a military reserve unit, as their military pay is often lower than their civilian salary.

Though the law tasked the Office of Personnel Management to issue regulations governing this differential pay, the HR agency instead issued policy guidance to agencies in 2009. That guidance, last updated in 2015, requires federal workers to prove that their active-duty deployment is “substantially connected” to a particular war or national emergency in order to be eligible for differential pay.

But in April 2025, the Supreme Court overruled that test in Feliciano v. Department of Transportation, finding that the law requires only a “temporal link” between an employee’s deployment and a national emergency. That case, decided by a 5-4 vote, involved a federal air traffic controller who spent nearly five years on active duty as a Coast Guard reserve petty officer escorting military vessels to and from harbor in support of the wars in Iraq and Afghanistan.

In a new lawsuit, VA attorney Marcus Colicelli, who also serves as a major in the Army Reserve’s Judge Advocate General’s Corps, argues that OPM’s continued failure to issue binding regulations on differential pay or to update its policy guidance to reflect the new Supreme Court precedent constitute a violation of the Administrative Procedure Act. During litigation of Feliciano, OPM twice stated that it planned to revise its guidance document; to date, it has not occurred.

“The Merit Systems Protection Board has meanwhile held, in a precedential decision involving the same employing agency as plaintiff’s, that a federal civilian employee ordered to active duty . . . is entitled to differential pay . . . where that service temporally coincided with a declared national emergency,” the suit states. “OPM’s guidance continues to instruct employing agencies to the contrary.”

According to Colicelli and his attorneys, the status quo effectively requires federal workers to pursue differential pay through their agency and be denied, then seek redress before MSPB in order to be made whole.

“Had OPM discharged the duty [the statute] imposes, its instructions would carry the force of law and would bind employing agencies government-wide,” they wrote. “Instead OPM substituted a non-binding subregulatory document for the binding rule Congress required. The result is that no employing agency is authoritatively directed to administer [the statute] as Feliciano construes it, and each reservist is left to vindicate his own entitlement agency-by-agency and activation-by-activation. The absence of a binding rule is not incidental to plaintiff’s injury; it is the injury.”

In a statement Thursday, Trial Lawyers for Justice, the firm representing Colicelli, said it is soliciting other plaintiffs in preparation for filing a class-action case with the Merit Systems Protection Board in the coming weeks.

“The Supreme Court could not have been clearer: these men and women earned this pay, and the law requires the government to make them whole,” said attorney Andrew Tutt, who also represented Feliciano in his case. “They held up their end of the bargain. It is long past time for the government to hold up its own.”

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Before you take money out of your TSP, weigh these trade-offs

Tammy Flanagan — Thu, 13 Aug 2026 15:00:00 -0400

The Thrift Savings Plan can be one of the most valuable retirement assets for federal employees (as well as members of the uniformed services), but once you leave federal service, the distribution decision is not just a matter of deciding how much cash you need. There are other important considerations to understand before you can select the dollar amount you will need to make your retirement financially secure. Remember that once a TSP withdrawal is processed, it generally cannot be reversed, so these are all important considerations to understand before deciding on your distribution plan.

If you have a minimum balance of $200, you may keep your money in the TSP. TSP elections for withdrawal include taking a partial distribution (minimum amount is $1,000), electing a total distribution, purchasing a life annuity (must have at least $3,500 to elect this option), setting up installment payments or combining methods.

Keeping money in the TSP may be appropriate if you do not need immediate income, because the plan offers simple investment choices and historically low expenses. Installment payments can create predictable cash flow while leaving the remaining balance invested. A life annuity can provide income for life, but it is typically irreversible and may reduce flexibility for heirs or future emergencies. A lump sum may be useful for a specific need, but it can create a large taxable event and remove assets from a disciplined retirement structure.

Taxes

Traditional TSP withdrawals are generally taxed as ordinary income in the year received. That means the timing and size of distributions can affect your marginal tax bracket, taxation of Social Security benefits, net investment income planning, state income taxes and estimated-tax requirements. Adding additional taxable income may even have an impact on the premiums you will pay for Medicare Parts B and D.

The TSP reports distributions to the IRS and may be required to withhold federal income tax from taxable payments, but remember that this withholding is not the same as the final tax that may be due. In addition to the IRS and federal income taxes, remember that many states will also consider these distributions taxable on the state level.

States that generally do not tax TSP or similar retirement-account distributions include the following states that don’t have an income tax — Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming — as well as states that generally exempt most retirement distributions, such as Illinois, Iowa, Mississippi and Pennsylvania.

State rules can change and may depend on residency, age, income level and the type of retirement income, so retirees should verify their state’s current rules before making large withdrawals or relocating to a state because of favorable income tax rules. Don’t forget about property tax, sales tax and other taxes that states need to collect to make the state an attractive place to retire.

Retirees should coordinate withdrawals with other taxable income, deductions, charitable giving and any planned Roth conversions.

Required minimum distributions (RMDs) also matter. If you are subject to RMDs, waiting until the first-year deadline may cause two taxable distributions in one calendar year: the delayed first RMD and the current-year RMD. That income bunching can increase taxes and may ripple into other areas, including Medicare premiums.

Roth TSP balances are treated differently from traditional balances under recent rules, but taxpayers should confirm current requirements before making elections. If you were born before 1960 and have left federal service, your RMD is at age 73 and the first distribution is due by April 1 of the year after you turn 73. If you were born in 1960 or later, your RMD age is 75 and your first distribution is due by April 1 of the year after you turn 75 or older and have left federal service.

If you are retiring early, be sure to understand the 10% early withdrawal penalty tax if you plan to take distributions or elect a withdrawal option before you reach age 59½. There is good news for some, since the additional 10% tax generally does not apply to payments made from your TSP account if you separate from federal service during or after the year you reach age 55.

Additionally, if you are a public safety employee as defined in section 72(t)(10)(B)(ii) of the Internal Revenue Code, payments made after you separate from service during or after the year you reach age 50 or have 25 years of service under the TSP are also exempt.

If you elect a life annuity, these payments will not be subject to the 10% penalty. If you elect a distribution of substantially equal payments over your life expectancy, these payments will not be penalized, but you must maintain this election until you reach age 59½.

The penalty can be applied retroactively if you stop your life expectancy installments or take additional money from your account within five years of beginning your installments or before you turn 59½ years old, whichever is later. See the TSP booklet 26, Tax Rules About TSP Payments, for more tax information and additional exceptions. Also, refer to IRS Publication 721, Tax Guide to U.S. Civil Service Retirement Benefits.

Living longer

One reason TSP distribution planning is so important is that older adults are one of the fastest-growing segments of the U.S. population, and more retirees may need their savings to last 25, 30 or even more years in retirement. Many retirees underestimate how long retirement can last.

Taking too much too soon can leave the later years exposed to inflation, medical costs, long-term care expenses or the loss of a spouse’s income. On the other hand, withdrawing too little may lead to unnecessarily large RMDs later or leaving out some of the enjoyment this additional income can add to your early retirement years.

A sustainable withdrawal strategy should consider expected longevity, survivor needs, inflation, investment risk, guaranteed income sources (i.e., Social Security benefits, CSRS, FERS retirement benefits, etc.) and whether it is important to preserve assets for your beneficiaries.

The following examples show why the distribution rate matters as much as the investment return. These are simplified illustrations using a $500,000 TSP balance, annual withdrawals taken at year-end, no additional contributions, no taxes, no inflation adjustment and steady annual returns of either 6% or 10%.

Actual results will vary because market returns are not level from year to year, taxes reduce spendable income and increasing withdrawals for inflation will shorten the timeline.

If you withdraw…

$25,000/year or 5% of your $500,000 balance, your payments can last indefinitely if a rate of return of at least 6% is earned consistently before costs and taxes are deducted.

However, if you increase your withdrawal amount each year by an estimated 3% inflation rate to maintain your purchasing power, your investment will last for only 29 years.

If you withdraw 7% of your balance or $35,000/year, you will run out of money in about 33 years if you earn a consistent 6% rate of return.

Your money may last indefinitely if 10% is earned consistently before costs and taxes.

However, if you add a rate of 3% or 4% inflation, your spending will quickly overtake the growth, and you may run out of money in as little as 26 years.

Unfortunately, if you start taking out lump-sum distributions in addition to the stream of payments, you may deplete your balance much more quickly.

A 10% average return can still produce poor outcomes if losses occur early in retirement, because withdrawals during down markets permanently reduce the number of shares left to recover. This is known as sequence-of-returns risk.

For that reason, retirees should test their TSP election against conservative return assumptions, inflation-adjusted withdrawals, income taxes, Medicare premium thresholds and the possibility of a very long retirement.

These examples do not guarantee these projections or recommendations! Try this calculator from USAA to help gauge how long your savings may last using estimated rates of inflation, your tax bracket and estimated rate of return.

Too much risk? Consider the life annuity

A TSP life annuity converts part or all of your account balance into guaranteed monthly payments for life through the TSP annuity provider. The primary advantage is longevity protection: Payments continue even if you live far longer than expected.

It can also reduce the pressure of managing investments in retirement and may be useful for someone who wants more guaranteed income in addition to a FERS or CSRS pension and Social Security.

There is a big trade-off to these advantages. Once TSP money is used to purchase a life annuity, you give up control. The payment amount depends on the purchase amount, age, interest-rate environment and selected features.

A single-life annuity may pay more each month than a joint-life annuity, but payments can stop at your death unless a qualifying feature is elected. A joint-life annuity can protect a spouse or other eligible joint annuitant, but the monthly payment is usually lower because the insurer may have to pay for two lifetimes.

Inflation is another key issue. Level payments start higher but remain the same, so purchasing power can decline over time. Increasing payments start lower but rise by a stated percentage each year, which may help offset inflation, although the increase may not fully match actual living-cost increases.

Retirees should also understand beneficiary features, such as cash-refund or certain-period options, because adding protection for heirs can reduce the monthly income. Here are some of the options with the key pros and cons:

Single life annuity with level payments provides the highest starting monthly income and the payments will last as long as you do, but there will be no continuing payment to your survivors unless you add additional features, and your purchasing power will be eroded over time since the payments will not increase.

Single life annuity with increasing payments provides a lower starting payment but will increase over time by a 2% annual adjustment that will help reduce some of the risk of inflation. However, these increases may not keep pace with actual inflation.

Joint life annuity with spouse and increasing payments will provide lifetime income for two lives with payments that rise over time. Typically, the lowest starting income of these examples is because it combines survivor protection with increasing payments.

Remember that electing a 50% survivor option will pay 50% of the payment to the survivor (not “your” survivor). Full payment is only paid while you are both living. To keep the payment level over both lifetimes, a 100% survivor election is available with or without the increasing payment option added.

The following illustration assumes $250,000 is used to purchase a single-life, level-payment TSP annuity. There is no payment to your beneficiary regardless of how long you survive after the annuity begins unless you add the “10-year certain” feature or “cash refund” feature, which would reduce these estimates.

This example uses the current August 2026 TSP annuity interest-rate index of 4.95% as the basis for the comparison, but the figures should still be treated as estimates rather than exact quotes. Actual TSP annuity payments depend on the participant’s exact age at purchase, the annuity provider’s factors, the option selected, whether increasing payments or refund features are added and the rate in effect when the annuity is purchased.

If a single life annuity is purchased at age 50, the monthly payment would be $720 and over 30 years, you would receive approximately $259,200. Over 10 years, the annuity would pay only $86,400.

If purchased at age 60, the monthly payment would be $1,095 and over 30 years, you would receive approximately $394,200. Over 10 years, the annuity would pay only $131,400.

This comparison highlights the longevity trade-off. A younger retiree generally receives a smaller monthly payment because the insurer expects to pay for more years. If that retiree lives long enough, the cumulative payments can eventually exceed the original $250,000 purchase amount.

However, if death occurs early and no refund or survivor feature was elected, the retiree may receive far less than the amount used to buy the annuity. Adding refund protection, survivor protection or increasing payments can change the result and usually reduces the initial monthly income.

You can use the TSP Annuity Calculator to try this for yourself.

TSP distributions can also affect Medicare Part B and Part D premiums through the income-related monthly adjustment amount, commonly called IRMAA. Medicare uses modified adjusted gross income from a prior tax year to determine whether higher-income beneficiaries owe surcharges.

A large TSP withdrawal, Roth conversion or RMD year can therefore increase Medicare costs two years later. This does not mean distributions should always be minimized, but it does mean retirees should model the after-tax and after-premium result before taking a large payment.

If your modified adjusted gross income as reported on your IRS tax return from 2024 is above $109,000 if you file an individual tax return or above $218,000 for those filing a joint return, you’ll pay the standard Part B premium of $202.90 (2026) and an income-related monthly adjustment amount.

Estate planning issues after retirement

Estate planning should also be part of the TSP distribution decision. Beneficiary designations generally control who receives the account at death, so retirees should review them regularly and coordinate them with a will, trust, life insurance, pension survivor election and family circumstances.

This review is especially important after marriage, divorce, the death of a spouse, the birth of grandchildren or a blended-family change.

Retirees should also consider whether a surviving spouse or other beneficiary will need continued income. A withdrawal strategy that works during a couple’s joint lifetime may not be sufficient if one spouse dies and household income changes.

Traditional TSP balances are generally taxable when distributed to beneficiaries, so leaving a large account to adult children can create income-tax consequences for heirs, particularly if they are already in high-earning years. A spouse may have more flexibility than a non-spouse beneficiary, and an IRA rollover may offer additional beneficiary-planning tools in some cases.

The TSP annuity election also has estate-planning consequences. Money used to purchase a single-life annuity may no longer be available to heirs unless a refund, survivor or certain-period feature is elected.

Those protections can help address survivor or legacy goals, but they usually reduce the starting monthly income. Retirees should balance guaranteed lifetime income against the need for liquidity, long-term care expenses and the desire to leave assets to family or charity.

Trust planning may be appropriate when beneficiaries are minors, have disabilities, struggle with financial management or are part of a blended-family plan, but retirement accounts and trusts require careful tax drafting.

Charitable planning should also be coordinated, because taxable retirement assets may be better suited for charitable gifts than after-tax assets. In short, the TSP should not be treated only as an income source. It is also an estate-planning asset that should fit with the retiree’s broader tax, legal and family goals.

Should I stay or should I go?

The IRA-versus-TSP decision is rarely all-or-nothing. Leaving money in the TSP may preserve low-cost investment access, the G Fund, creditor protections, simplicity and certain penalty exceptions.

Rolling money to an IRA may provide broader investment choices, more flexible beneficiary planning, qualified charitable distribution options, professional account management or coordinated Roth conversion strategies. However, IRAs can also carry higher costs, sales incentives, more complicated investment choices and different protection rules.

A direct rollover can avoid current taxation when moving traditional TSP money to a traditional IRA, but an indirect rollover, missed deadline or Roth conversion can create taxable income.

A qualified financial professional can help compare TSP distribution choices, but the selection should be made carefully. The right advisor should understand federal benefits, TSP withdrawal rules, the FERS or CSRS pension, Social Security claiming, Medicare premium thresholds, beneficiary planning and the tax impact of traditional and Roth withdrawals.

This is especially important because TSP elections often interact with several other retirement decisions at the same time. Ask whether the professional you are considering acts as a fiduciary, how they are paid, what credentials they hold and whether they have specific experience working with federal employees.

Fee-only, fee-based, commission-based and insurance-licensed professionals may all provide different services, but their compensation structures and potential conflicts should be clear. It is also wise to ask whether the advisor will coordinate with a tax professional or estate planning attorney when the TSP decision involves Roth conversions, RMDs, trusts, charitable planning or large rollovers.

Before hiring someone, consider asking practical questions:

Have you worked with federal retirees before?

Can you compare leaving money in the TSP with rolling assets to an IRA?

Will you provide a written analysis of taxes, Medicare effects, survivor needs and investment risks?

Do you recommend specific products, and if so, how are you compensated? Will I retain access to low-cost TSP options if I move money?

A good professional should be willing to explain both the benefits and drawbacks of each option, not simply recommend a rollover or annuity without showing how it fits the retiree’s broader plan.

Before making an election, here are five questions to consider:

How much income do I need now?

What tax bracket will this distribution create?

Could the distribution increase Medicare premiums?

Will I need penalty-free access before age 59½?

Am I giving up TSP features that are hard to replace?

The best TSP distribution strategy is the one that balances current income needs with tax efficiency, Medicare planning, longevity protection and flexibility. Because the consequences can last for decades, a careful review with a qualified tax or financial professional is often worth the effort before the election is submitted.

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The state of play around the 2027 pay raise, or lack thereof

Erich Wagner — Thu, 06 Aug 2026 16:55:28 -0400

President Trump is expected sometime this month to issue a plan to freeze federal employee pay in 2027, though if last year was any indication, it may not be that straightforward.

When the White House published its fiscal 2027 budget proposal in April, the document, which normally lays out the administration’s pay plan for the following year, was silent on civilian compensation. The Office of Management and Budget later confirmed that Trump was in fact proposing “no pay increase” for 2027, while military service members would see between a 5% and 7% raise, depending upon their rank.

Trump now has until the end of August to formalize his alternative pay plan for next year; otherwise, much larger automatic increases in locality pay would take effect, due to a formula in the 1990 Federal Pay Comparability Act that has been criticized by presidents of both parties since its enactment.

Congress thus far has not taken action to overrule Trump’s pay plan. The House’s fiscal 2027 financial services and general government appropriations bill is silent on federal employee pay—effectively endorsing the president’s plan. And while the Senate has not yet published its draft of the FSGG funding bill, lawmakers in that chamber have proposed reducing the military pay raise to an across-the-board 3.6% raise as part of its proposed 2027 National Defense Authorization Act.

Democrats in both the House and Senate have called for a more fulsome raise of 4.1% on average next year, as part of their annual advocacy for the Fair Adjustment of Income Rates Act. Under that plan, civilian federal employees would receive a 3.1% increase in basic pay, coupled with an average 1% increase in locality pay.

While Trump is expected to formalize his plan for a pay freeze later this month, it’s not a sure thing. Last year, the president’s so-called “skinny” budget was also silent on federal employees pay, while OMB documents to agencies instructed them to plan for a pay freeze in 2026.

But ultimately, the president’s alternative pay plan enacted a 1% across-the-board increase in basic pay and no increase in locality pay for most workers. Feds in “law enforcement” fields were granted a 3.8% raise, in line with the increase afforded to military service members in 2026.

More changes to federal compensation could be in the offing in the coming months, as the Office of Personnel Management has signaled it plans to issue new regulations governing the locality pay system.

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Former feds have a new way to find their personnel files

Tammy Flanagan — Thu, 06 Aug 2026 15:00:00 -0400

One of my colleagues, retirement benefits expert Michele Bollier, who answers emails from members of the National Active and Retired Federal Employees Association, was helping a retiree and discovered more good news coming from the Office of Personnel Management.

The agency has taken an important step toward modernizing access to federal personnel records with a new resource called the eOPF Resource Center and the recent launch of the eOPF Documents Request Service.

The electronic Official Personnel Folder, or eOPF, began 20 years ago when the National Finance Center payroll provider started sending SF-50s, Personnel Action Statements, and transactions to the eOPF system for processing. Scanned documents from paper Official Personnel Folders began being added to eOPF in 2007. Two decades have passed since the Commerce Department implemented an e-government initiative that provided easier and faster access for current employees to their personnel files.

Now, if you are a former federal employee or retiree looking for personnel records from your eOPF, there is a new and faster way to request them.

For current and former federal employees, the “electronic Official Personnel Folder,” or eOPF, is more than an administrative archive. It is the official record of federal employment, containing documents such as SF-50s, appointment and separation actions, position changes, benefits-related forms and other records that may be needed years after someone leaves government service.

For many former employees, getting these records has historically been frustrating. Once an employee separated, online access to the agency eOPF system generally ended, leaving the former employee to contact a previous agency human resources office or submit a written request to the National Personnel Records Center.

OPM’s new resources are designed to make that process clearer and, for many people, faster.

The most significant new resource is the Documents Request Service, a secure, public-facing portal. The service allows eligible separated federal employees to request and receive a copy of their eOPF employment folder electronically.

OPM describes the tool as a self-service option that eliminates the need for former employees to rely on government networks, agency-issued credentials or manual paper-based fulfillment methods when their records are already maintained in eOPF.

Being a former federal employee, I decided to try out this new service. I had my doubts since I left federal service in 1988 and doubted that anyone had scanned my old personnel records into the eOPF system. I was right: There were no records.

However, I was reminded that to sign into the Login.gov system, you will need to scan your driver’s license or passport into the system and then provide your Social Security number as further identification that it is you who is trying to log in.

If you are informed that the system could not find your records, you should check the information you entered and try again. Common mistakes are an incorrect Social Security number or ZIP code. You can try it four more times. Then you must wait six hours before trying again.

The service is intended primarily for separated federal employees whose records are in eOPF. It may also be used by current federal employees who do not have government-furnished equipment, a PIV card, a government email address or secure access to their agency’s eOPF system.

It is not intended for current employees who already have normal access through their agency, third-party requesters, the public or individuals whose records were never maintained in the eOPF system.

Former employees who want to use the Documents Request Service should generally wait at least 30 days after their separation date before submitting a request. OPM advises this waiting period because final separation documents, including the SF-50 documenting separation, may not be profiled into the eOPF immediately. Requesting too early could result in an incomplete folder.

OPM’s user guidance says the file should be downloaded and saved promptly because the link expires after 24 hours. The password format described in OPM’s guide uses the employee’s date of birth and the last four digits of the Social Security number.

Because the file contains sensitive personnel information, former employees should save it in a secure location and avoid forwarding it through unsecured email.

In case your records can’t be retrieved through this new system, OPM points users to more traditional options: Contact the former employing agency or request records from the National Personnel Records Center. NPRC maintains official personnel folders for many former federal civilian employees whose service ended after 1951. These records remain subject to the Privacy Act, so access is restricted.

The person of record may request copies of most civilian personnel records, including SF-50s, by submitting a written, signed and dated request. The request should include identifying information such as full name, date of birth, Social Security number, last employing agency, duty station, approximate dates of employment and a clear description of the records needed.

Timing is important here as well. NPRC guidance notes that OPFs are generally retired to the center after separation. If not enough time has passed, the former employee may need to contact the last employing agency instead.

OPM’s post-separation FAQ also explains that eOPF records are often transferred from the former agency to NPRC within 30 to 60 days after the separation action is processed, though an agency may retain the eOPF longer. If the agency still has the folder, it may be required to provide physical copies upon request.

For older personnel records, former employees should understand the difference between non-archival and archival OPFs.

NPRC’s Federal Records Center Program maintains OPFs for former federal civilian employees whose employment ended after 1951. These files generally remain in OPM’s legal custody and are protected by the Privacy Act, which means the person of record, or an authorized third party with signed consent, is usually the proper requester.

Civilian employment records are normally transferred to NPRC within 120 days after separation. If fewer than 120 days have passed, the employee should write to the last employing agency instead.

A written NPRC request should be signed and dated and should clearly identify the records needed, such as the most recent SF-50 or the complete official personnel folder. To help NPRC locate the file, the request should include the full name used during federal employment, date of birth, Social Security number if applicable, employing agency name and location, duty station and approximate beginning and ending dates of service.

Records for federal civilian employees whose service ended before 1952 follow a different archival access process through the National Archives. Those older OPFs may be handled as archival holdings rather than current federal records, so requesters should use National Archives guidance for archival civilian personnel folders.

In practical terms, a former employee seeking older records should first determine the approximate separation date: After 1951 generally points to NPRC’s non-archival OPF process, while before 1952 points to the archival OPF process.

Access to personnel records is not just a matter of convenience. Former employees may need their SF-50s and related documents to verify prior federal service, apply for another federal position, resolve pay or leave questions, support a retirement or benefits claim, confirm military service credit or assist with a security clearance review.

Having an easier electronic path to these documents can reduce delays at moments when former employees may be facing deadlines or life transitions.

The new eOPF resources also reinforce a best practice: Employees should review and download important records before leaving federal service whenever possible. It is much easier to identify missing or incorrect documents while still employed and while agency HR staff can correct problems directly.

Before separation, employees should check key documents such as SF-50s, service computation dates, beneficiary forms, military deposit records, retirement coverage and benefits elections. Any discrepancies should be raised with HR before access ends.

OPM’s updated eOPF Resource Center and Documents Request Service give former federal employees a clearer roadmap for obtaining personnel records after leaving government. The best approach is to start with the new portal if eligible, wait long enough for final separation documents to be added, download the completed folder promptly and keep the records secure. If the portal cannot locate the folder, the next step is to contact the former agency or submit a written request to NPRC. Together, these resources should make it easier for former employees to prove their service, protect their benefits and manage federal employment records long after their last day on the job.

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TSP investments continued to tumble in July

Erich Wagner — Tue, 04 Aug 2026 14:22:19 -0400

Most funds offered as part of the federal government’s 401(k)-style retirement savings program finished July in the red, continuing the downward trend that began the prior month.

Only the Thrift Savings Plan’s G Fund, which is made up of government securities, grew last month, increasing by its statutorily mandated rate of 0.39%. So far this year, the G Fund has gained 2.57% in value.

The common stocks of the C Fund were virtually flat in July, falling 0.07% and bringing its 2026 performance down to 10.13%. And the international (I) fund lost 1.01% last month; since January, the I Fund is up 15.35%.

The small- and mid-size businesses of the S Fund finished July 4.12% in the red. So far this year, the S Fund has gained 13.52%. And the fixed income (F) Fund lost 1.29% last month, bringing its 2026 losses to 0.56%.

Each of the TSP’s lifecycle (L) funds, which shift toward more conservative investments as participants approach retirement age, likewise lost ground in July. The L Income Fund, designed for those who have already begun making withdrawals, fell 0.06%; L 2030, 0.41%; L 2035, 0.57%; L 2040, 0.66%; L 2045, 0.73%; L 2050, 0.79%; L 2055, 0.92%; L 2060, 0.92%; L 2065, 0.92%; L 2070, 0.92%; and L 2075, 0.92%.

So far this year, the L Income Fund has grown 5.18%; L 2030, 7.89%; L 2035, 8.93%; L 2040, 9.48%; L 2045, 10.45%; L 2050, 12.36%; L 2055, 12.36%; L 2060, 12.36%; L 2065, 12.36%; L 2070, 12.36%; and L 2075, 12.36%.

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LGBTQ+ feds sue to restore FEHB coverage of gender affirming care

Erich Wagner — Mon, 03 Aug 2026 17:18:35 -0400

A group of five federal employees filed a class action lawsuit against the Office of Personnel Management Monday, alleging that the agency’s cancellation of employer-sponsored health insurance coverage of gender affirming medical treatments amounts to unlawful sex discrimination.

When President Trump returned to office in January 2025, he signed an executive order requiring agencies to cease recognizing the concept of “gender identity” or the existence of transgender or otherwise gender non-conforming people. At OPM, implementation included instructing insurance carriers participating in the Federal Employees Health Benefits and Postal Service Health Benefits programs to cease covering gender-affirming care in most cases beginning last January.

The pseudonymous plaintiffs, four transgender or non-binary federal employees and one employee whose daughter is transgender, said they face medical bills in the tens of thousands of dollars if forced to pay out of pocket for the hormonal and surgical treatments their doctors have prescribed.

The lawsuit, filed in the U.S. District Court for Washington, D.C., alleges violations of Title VII of the 1964 Civil Rights Act, and describes the gender-affirming care ban as “akin to denying continuing insulin treatment for someone with diabetes.” And the treatments sought by transgender or gender non-conforming employees are still approved in other contexts for cisgender workers and beneficiaries.

“[OPM’s] carrier letters discriminate on the basis of sex on their face,” the lawsuit states. “[The first letter] excludes ‘chemical and surgical modification of an individual’s sex traits through medical interventions (to include “gender transition” services)’ from FEHB and PSHB coverage. This exclusion targets gender-affirming care—care that is sought by transgender and gender non-conforming people—and thereby singles out current and former employees for less favorable treatment and fewer employment benefits than accorded their non-transgender counterparts.”

Under 2024 Supreme Court precedent, discrimination on the basis of someone’s gender identity is unlawful under Title VII, though the executive order underlying this case itself advocates for Bostock v. Clayton County, Ga., to be overturned. Federal judges have blocked that edict’s implementation by a number of agencies, including the U.S. Bureau of Prisons in regard to its treatment of transgender inmates, though the agency violated that order last week.

Representing the plaintiffs are the Human Rights Campaign Foundation as well as former Merit Systems Protection Board Member Cathy Harris. Attorneys estimated that nearly 40,000 federal employees, retirees or dependents could be impacted by OPM’s gender affirming care ban.

“Healthcare access should never be weaponized to advance discrimination—and the denial of coverage for critical healthcare based simply on who you are blatantly violates the rights of all of us,” said HRCF President Kelley Robinson. “This odious policy is the latest example of the Trump administration’s obsession with targeting transgender people, using shameful and cruel tactics to threaten their employment, their health and the well-being of themselves and their families.”

“Federal employees have been through the wringer with the Trump administration,” Harris said. “We draw the line at blatant discrimination to deny healthcare to our nation’s dedicated civil servants.”

OPM did not respond to a request for comment.

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Why time, not timing, is the biggest retirement advantage for federal employees

Tammy Flanagan — Thu, 30 Jul 2026 15:00:00 -0400

As most federal employees covered by the Federal Employees Retirement System (FERS) know, a comfortable retirement cannot rely on the FERS basic retirement benefit alone. FERS is built on three parts working together to produce a financially comfortable retirement: the basic retirement benefit, Social Security and the Thrift Savings Plan (TSP). Of those three, the TSP is the part employees can most directly influence through payroll contributions, investment choices and time in the market. That is why understanding compounding is not just a financial concept. It is a practical career-long strategy.

It is amazing to learn that the largest TSP account balance was $10,820,000 as of the end of June. However, at the Federal Retirement Thrift Investment Board's July board meeting, the reported average TSP account balance for June was $157,412, with the average participant contributing for nearly 11 years. Yet most accounts — 4,095,134 of them — were still under $50,000, with an average contribution history of a little more than six years.

The contrast is important: Balances tend to grow most visibly after years of steady saving, reinvested earnings and market participation.

For accounts between $500,000 and $749,000, the average number of years contributed was 21.96 years.
For accounts between $750,000 and $999,000, the average number of years contributed was 23.85 years.
For accounts of $1,000,000 or more, the average number of years contributed was 27.25 years.

Note: Values include FERS, CSRS and uniformed services accounts.

These numbers are a practical reminder that retirement wealth is built through repeated contributions, agency matching dollars, long-term investment discipline and the compounding of earnings over many years. Compounding is the process of earning money not only on contributions but also on prior earnings. In a retirement account, that means the earliest dollars have the longest runway. A contribution made in the first decade of a federal career can potentially benefit from decades of market returns, reinvested growth and additional agency contributions.

For eligible FERS employees, the agency contribution makes early and consistent saving even more powerful. FERS employees receive an automatic 1% agency contribution to the TSP, along with dollar-for-dollar matching contributions on the first 3% of basic pay they contribute and an additional 50 cents on the dollar on the fourth and fifth percent of employee contributions. Setting your savings at 5% or higher is the key to receiving the full available agency match. Missing that match means giving up retirement money today and the future growth that money could have produced.

As of May 31, the C Fund held more than $500 billion of the TSP's total assets, representing a 43.9% share of all TSP fund assets.

As of June 30, 2026, the top companies in the S&P 500 Index, which the TSP's C Fund is designed to track, were dominated by technology and communication services companies, including Nvidia, Apple, Microsoft, Amazon, Alphabet, Broadcom, Micron, Meta and Tesla.

Sector weightings showed information technology at 38.0%, followed by financials at 11.8%, communication services at 9.7%, consumer discretionary at 9.3%, industrials and health care at 8.9% each and smaller allocations across consumer staples, energy, utilities, materials and real estate.

The lesson is to participate consistently through a diversified strategy that can benefit as market leaders shift over time. According to S&P Global, the S&P 500 currently represents approximately 83% of total U.S. market capitalization. This broad coverage enables it to closely track the performance of the overall U.S. equity market. The largest companies in the index account for a substantial share of its total market capitalization, giving them the greatest influence on the index's performance.

Consider the performance of the following investments over time:

A $1,000 investment in the S&P 500 made 20 years ago would be worth more than $8,500 today. In 2006, the maximum elective deferral limit was $15,000. Investing $15,000 in the C Fund 20 years ago would be worth around $127,500 today.
A $1,000 investment in Nvidia 20 years ago would be worth more than $560,000 today. Interestingly, Nvidia officially joined the S&P 500 on Nov. 29, 2001, replacing Enron.
A $1,000 investment in Apple 20 years ago would be worth about $130,000 today.
A $1,000 investment in Microsoft at its 1986 initial public offering would be worth roughly $6.46 million today. A $1,000 investment made 20 years ago would be worth approximately $20,088.
A $1,000 investment in Amazon 20 years ago would be worth roughly $90,000 to $135,000 today.
A $1,000 investment in Broadcom 20 years ago would be worth approximately $254,613 today.

These examples are not recommendations for buying individual stocks, as past performance cannot predict future results. Buying individual stocks for retirement is risky because it lacks diversification, demands intensive research and introduces high emotional volatility. In the TSP, most federal employees pursue this kind of long-term growth through diversified funds, such as the C, S, I, F and G Funds, or through Lifecycle Funds that adjust allocations across all five core funds over time.

Looking back to 1980 — a year that was personal for me because I got married, moved to Washington, D.C., and was just beginning my career at age 22 — the leading companies looked very different:

IBM, then the index heavyweight in information technology. If you put $1,000 into IBM stock 20 years ago, it would be worth about $5,700 today.
AT&T, the pre-divestiture telecommunications monopoly.
Exxon, now part of ExxonMobil.
Standard Oil of Indiana, later Amoco and eventually part of BP.
Schlumberger, an energy and oil field services company.
Shell Oil, part of the energy sector.
Mobil, later merged with Exxon.
Standard Oil of California, later Chevron.
Atlantic Richfield, known as ARCO, was later acquired by BP.
General Electric, an industrial leader.

The point is not that one sector is always best. In 1980, energy and oil service companies dominated the top 10. Today, technology and communication services carry much more weight. Federal employees who save steadily in diversified TSP funds do not have to know in advance which companies will lead the next generation. They simply need a contribution plan, an allocation appropriate for their age and risk tolerance and the patience to let compounding work.

Here are some things you can do to prepare for your future retirement:

Contribute at least 5% if you are eligible for the full FERS match. The match is part of your compensation and can compound along with your own contributions. The May TSP Activity Report indicated that 86.6% of FERS employees contributed at least 5% of their basic pay to receive the full match.
Increase contributions when pay increases. Even small increases can become meaningful over a full federal career.
Know the annual limits. For 2026, the TSP elective deferral limit is $24,500. FERS employees age 50 and older may make up to $8,000 in additional catch-up contributions, with a higher catch-up opportunity of $11,250 for those ages 60 through 63.

The following two things can be done automatically by investing in the TSP Lifecycle Fund that matches your time horizon (an investment time horizon is the period during which an investment is expected to be held to achieve financial goals):

Stay diversified. Market leadership changes. Diversification helps reduce the risk of relying too heavily on one company or sector.
Review your allocation periodically. Your investment mix should reflect your time horizon, risk tolerance and retirement income needs.

Do not wait for the perfect time. The most valuable ingredient in compounding is time, and time cannot be replaced later.

Federal service comes with a valuable retirement framework, but the strength of that framework depends in part on the actions you take throughout your career. The FERS annuity and Social Security provide important foundations. The TSP gives employees the opportunity to build personal retirement wealth through disciplined saving, agency contributions, diversified investing and compounding.

A trip down memory lane shows that markets evolve, leaders change and time rewards consistency. For federal employees, the most important step may be the simplest: Start saving, keep saving and give compounding enough years to do the heavy lifting.

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NARFE still has concerns with OPM’s plan to collect employee health care records

Erich Wagner — Fri, 24 Jul 2026 13:18:06 -0400

The National Active and Retired Federal Employees Association on Thursday said the Office of Personnel Management still has not sufficiently protected federal workers and retirees as part of a plan to collect claims-level health data in an effort to root out fraud.

Last December, OPM published an information collection request that would require insurers who participate in the Federal Employee Health Benefits and Postal Service Health Benefits programs to provide monthly reports with identifiable health data on their enrollees, prompting concerns from ethicists, health care providers, employee groups and lawmakers alike.

In response to those concerns, OPM published a revised proposal last month, purporting to take steps to mask employees and retirees’ identities in the data collection. In an accompanying blog post, OPM Director Scott Kupor described how the anti-fraud effort would still protect workers’ privacy.

“In layman’s terms, OPM’s [Office of Inspector General] . . . will provide an encrypted copy of that data to OPM—but only after stripping out names, Social Security numbers, phone numbers, addresses (except for ZIP codes) and other personally identifiable data,” he wrote. “The only member-level [personally identifiable information] fields that will remain in the data that OPM receives will be our members’ ZIP codes, year of birth and their member ID. To further sanitize these records, OPM will scramble, or pseudonymize, the member ID information using a state-of-the-art cryptographic hashing process, replacing member ID with a random set of numbers and characters that is divorced from the real identity of the plan participant.”

But in a letter to Kupor Thursday, NARFE National President William Shackelford said that while his organization appreciates the steps taken thus far to shield FEHBP and PSHBP participants’ identities, he remains troubled by OPM’s insistence that it be able to re-identify employees via their health records in the future. Under the Health Insurance Portability and Accountability Act, health care data should be not just pseudonymized, but de-identified entirely, he wrote.

“NARFE’s position is straightforward. OPM has moved in the right direction,” Shackelford wrote. “But we asked for de-identified data and OPM has offered pseudonymized data, and those are not the same commitment. Pseudonymization does not remove the risk that our members’ health information will be linked back to them; it makes that linkage a matter of OPM’s discretion, exercisable by whoever holds the relevant authority in any future administration.”

Additionally, most of OPM’s reassurances about privacy and the data collection’s anti-fraud purpose exist solely within Kupor’s blog post, and not the proposal published in the Federal Register last month.

“What remains is otherwise the difference between description and obligation,” Shackelford wrote. “We ask OPM to convert what it has described into what it is bound to do: de-identification as the default and pseudonymization as the justified exception, mandatory rather than discretionary safeguards, hard separation of key material from enrollment files . . . and an explicit prohibition on personnel-related use.”

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Why your retirement experience may depend more on the agency than the benefit

Tammy Flanagan — Thu, 23 Jul 2026 15:00:00 -0400

As federal employees transition into retirement, they also transition from familiar routines. After many years, if not many decades, of knowing where to go when it is time to access or change their federal benefits, retirement creates a need to learn new methods of communicating with new organizations. For health benefits, life insurance and, most importantly, retirement, the Office of Personnel Management becomes the new "personnel" shop for recent retirees. To turn on Social Security retirement benefits, learning to navigate the Social Security Administration's website and phone system becomes very important.

Instead of watching their lifetime retirement savings continue to grow, it is now time to figure out how to turn those investments into a stream of income that must last for many years and often several decades to come. These organizations provide customer service to help answer questions and guide new annuitants as they learn the ropes of life after retirement. Customer service is the help and support these individuals will rely on before, during and after their service to the federal government comes to an end. In anticipation of a smooth and enjoyable experience, there is an element of not knowing what to expect and the fear that something might go wrong.

For federal employees and retirees, customer service is not an abstract measure of government performance. It determines how quickly a new retiree receives their full annuity, whether a participant can resolve a Thrift Savings Plan account problem and how long a Social Security beneficiary must wait for help with a benefit issue. Recent statistics suggest three very different customer service stories. OPM's Retirement Services operation is still judged largely by claims-processing time and backlog. The Thrift Savings Plan, administered by the Federal Retirement Thrift Investment Board, reports comparatively strong participant satisfaction and short telephone wait times. The Social Security Administration serves a much broader public and has recently shown measurable improvement in telephone service, though its reported averages can mask long waits for some callers.

OPM Retirement Services has one of the most consequential service roles in the federal benefits ecosystem: converting a retiring employee's application into interim and then final annuity payments. The most recent OPM retirement processing data show the scale of the challenge. OPM reported that it experienced a historic surge in retirements in 2025 and responded by expanding the team. However, overall, Retirement Services shrunk 16% from fiscal 2024 to fiscal 2026.

That higher volume matters because retirement processing is document-heavy, depends on agency and payroll office submissions and can be delayed by missing or inconsistent records.

OPM's June 2026 retirement processing report illustrates both improvement and strain. In June, the agency received 8,663 new retirement claims, of which 6,852 were digital and 1,811 were paper. It processed 12,751 total claims that month, but the total inventory still stood at 33,851 pending cases.

The average processing time for all cases was 108 days in June, while digital cases were processed in 96 days and paper claims in 120 days. For the fiscal year to date, the average processing time was 77 days, and the fiscal-year-to-date digital processing time was 52 days. These numbers show why digital retirement processing is central to OPM's service strategy: Digital cases are faster, but the transition is incomplete, and paper cases continue to slow the system.

Compared with the other two agencies, OPM's service problem is the most specialized and the most procedural. The customer may contact OPM for status updates, but the real service outcome is whether the retirement claim is adjudicated accurately and quickly. A retiree waiting months for a finalized annuity may see the process as poor customer service even if phone representatives are courteous. OPM's published data also make clear that modernization is producing benefits, but not yet enough to eliminate large inventories or long waits during claim surges.

The TSP presents a different customer service profile. The TSP is massive. Recent reports show more than 7.3 million accounts and assets surpassing $1 trillion, yet its service statistics are notably favorable. In recent years, the TSP said it issued more than 1 million Forms 1099-R and notified more than 300,000 participants about required minimum distributions.

The March 2026 board materials showed that in February, the ThriftLine received approximately 200,000 calls, with an average waiting time to reach an agent of 11 seconds and 95% of callers waiting 20 seconds or less. Overall participant satisfaction with the ThriftLine exceeded 93% for the 12th consecutive month.

In the May report, it was noted that participants logged in about 4 million times to My Account through the Thrift Savings Plan mobile app during April, accounting for 42% of all TSP logins, up from 32% one year earlier. In April, TSP participants completed nearly 7,000 Roth in-plan conversions totaling approximately $135 million.

These statistics suggest that, among the three organizations, TSP currently offers the strongest measurable front-end customer experience. Its service channels are designed around account access, transactions, withdrawals, loans, beneficiary issues and investment elections. While individual participants may still encounter complex cases, especially around post-separation withdrawals or legal processing, the published service metrics point to a system that is answering calls quickly and satisfying most users who interact with it. The TSP also benefits from a narrower mission than SSA and a more account-based operating model than OPM Retirement Services.

The Social Security Administration is not directly comparable in scale. It serves more than 300 million people with active Social Security numbers and more than 71 million beneficiaries. Its customer service challenge spans retirement, disability, survivors, Medicare-related services, Social Security numbers, overpayments, appeals and in-person field office needs. SSA reports that online and telephone channels now account for most customer contacts, with online services increasingly emphasized through my Social Security accounts and digital transactions.

Recent SSA data show meaningful improvement, especially on the National 800 Number. The agency reported that, compared with service levels in May 2025, reductions in wait times through May 2026 saved the public an estimated 14.2 million hours: 7.6 million through online services, 4.9 million through the National 800 Number and 1.7 million through field office calls and visits. SSA also said it had served 5.9 million more callers in the fiscal year to date, an increase of more than 29% compared with prior years.

An inspector general audit released in December 2025 found that SSA's publicly reported National 800 Number metrics were accurate and that overall telephone service improved in fiscal 2025. The report said SSA served 68 million callers through employees or automation, a 65% increase from fiscal 2024. The average speed of answer was 13 minutes in October 2024, peaked at 30 minutes in January 2025 and fell to 7 minutes by September 2025. That was an improvement over fiscal 2024, when the peak was about 42 minutes and the low was 12 minutes.

Still, SSA's statistics require careful interpretation. The inspector general noted that the average speed of answer does not capture the full wait experienced by every caller. If a caller accepted a callback, SSA counted the call as having zero wait time for that metric, while the later callback delay was tracked separately.

For callers who stayed on hold in fiscal 2025, average queue wait time was about 51 minutes in October 2024, peaked at 1 hour and 40 minutes in January 2025 and fell to 19 minutes in September 2025. Average callback time was about 1 hour and 49 minutes in October 2024, peaked at 2 hours and 32 minutes in January 2025 and declined to about 1 hour and 2 minutes in September 2025. In other words, SSA improved significantly, but some customers still experienced long waits.

Measured by speed and satisfaction, the TSP appears to be performing best. Its recent reported wait times are measured in seconds, and satisfaction has remained above 93% for at least a year. Measured by breadth of service and volume handled, SSA faces the hardest public-facing challenge and has shown the largest recent improvement. Its phone metrics improved substantially in fiscal 2025 and continued to show gains into 2026, but its callback and queue-wait details reveal that averages can understate the experience of customers with complicated needs.

Measured by the consequences of delay, OPM Retirement Services may present the highest anxiety for its customers. A delayed TSP transaction or SSA phone call is frustrating, but a delayed federal annuity calculation can affect a retiree's monthly income for months.

The fairest conclusion is that each organization's customer service record reflects its mission and operating model. TSP service is the most consistently positive in the available statistics, aided by a transactional account structure and strong call center performance. SSA is the most improved, but because it serves nearly the entire public and handles highly varied benefit issues, it remains vulnerable to congestion and uneven experiences. OPM Retirement Services is making progress through digital retirement processing, but its backlog and processing times remain the most visible pain point for federal retirees.

For employees approaching retirement, the practical lesson is clear: Prepare paperwork early, use digital tools where available, monitor account access before separation and keep expectations realistic. The best customer service among the three is currently at the TSP, the most improved is SSA and the most urgent modernization challenge remains OPM retirement processing.

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OPM moves to implement long-awaited retirement fix for federal first responders

Erich Wagner — Tue, 21 Jul 2026 17:27:51 -0400

The Office of Personnel Management is set to propose new rules this week implementing a 2022 law aimed at reforming retirement benefits for federal first responders who are injured during their service and forced to pursue jobs elsewhere in government.

Federal workers in professions like law enforcement and firefighting participate in the federal government’s defined benefit retirement program on an accelerated basis—in exchange for paying more toward their pensions each paycheck, they become eligible for their full annuity once they have served 20 years and reached age 50. They are also subject to mandatory retirement at age 57.

But if a federal first responder is injured on the job and unable to continue in their current role, they lose access to the accelerated retirement timeline, despite the increased payments they have already made along the way.

A proposed rule set for publication Wednesday in the Federal Register would implement the First Responder Fair RETIRE Act, a 2022 law aimed at fixing this flaw. The legislation allows first responders forced to take a job elsewhere in the federal government to continue to pay accelerated contributions and reach retirement when they originally planned. And it grants feds the chance to be refunded the extra half-percentage point of their salary that went toward retirement if they leave federal service altogether prior to reaching retirement age.

The regulations establish criteria by which an employee may be eligible to retain their accelerated retirement timeline after returning to federal service following an injury: the employee must be serving as a law enforcement or Customs and Border Protection officer, firefighter, air traffic controller, nuclear material courier, or members of the Capital or Supreme Court police; their injury must be the “direct result” of something that happened while they were performing their duties; they must be “permanently unable” to serve in their original post; and they must not yet be eligible for voluntary or mandatory retirement.

But OPM hesitated at implementing Section 2 of the law, a “sense of Congress” statement in favor of retaining national security workers and their institutional knowledge.

“It is in the best national and homeland security interests of the United States for federal agencies to retain the specialized knowledge and expertise of individuals who suffer an injury or illness while serving in a covered position (as defined under the amendments made by this act),” the law states. “Federal agencies should ensure, to the greatest extent possible, that an individual who can no longer carry out the duties of a covered position, and is reappointed to a position in the civil service that is not a covered position, is reappointed within the same federal agency, in the same geographic location, and at a level of pay commensurate to the position which the individual held immediately prior to such injury or illness."

"Section 2 provides guiding principles for interpreting the statute, but it does not convey authority to issue regulations to achieve the stated objectives or to take other actions not otherwise permitted by law,” OPM wrote. “OPM has broad authority to regulate the [Civil Service Retirement System] and the [Federal Employees Retirement System]. Nonetheless, that regulatory authority is limited to regulations that are necessary to ‘carry out’ subchapter III of chapter 83 (the CSRS law) and chapter 84 (the FERS law). Section 2 is not part of those laws.”

Nonetheless, OPM said it would seek to implement at least the second half of the sense of Congress statement through other regulations governing workplace injuries.

“However, the Sense of Congress can be connected to the requirements in . . . a provision in the federal employee workers’ compensation law that provides for reemployment and retention rights for individuals who resume employment after overcoming injury or disability,” the rule states. “[If] it is not possible to reemploy the employee in a position in the same employing agency, that agency should seek OPM assistance with placing the employee.”

OPM is soliciting public comments on its proposal until September 30.

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Why Social Security's uncertainty is becoming a federal workforce issue

Tammy Flanagan — Thu, 16 Jul 2026 15:00:00 -0400

This week, Sens. Tim Kaine, D-Va., Dick Durbin, D-Ill., Bill Cassidy, R-La., Thom Tillis, R-N.C., and Angus King, I-Maine, introduced a bipartisan proposal to encourage congressional action on Social Security: the Protecting Retirement Opportunities and Maintaining Income Security for Everyone, or PROMISE, Act.

The PROMISE Act tackles the long-term finances of Social Security's retirement program by moving reform out of endless discussion and into an actual legislative process. The bill itself does not raise payroll taxes, reduce benefits, change the retirement age or alter eligibility rules. Instead, it creates a framework in which those options, or some combination of them, could be evaluated, amended and put to a vote.

The Social Security 2026 Trustees Report was released earlier this year and showed that within six years, if Congress does nothing, Social Security income will cover only about 78% of scheduled retirement benefits. That warning is especially consequential for federal employees covered under the Federal Employees Retirement System because FERS was built on three coordinated sources of retirement income: the FERS basic benefit, Social Security and the Thrift Savings Plan. For federal workers, Social Security reform is not an abstract national budget debate. It directly affects retirement timing, income planning, TSP savings decisions and confidence in the federal retirement promise.

Because FERS employees pay Social Security taxes and rely on Social Security for a meaningful share of retirement income, changes to the program's solvency, claiming rules, disability protections or benefit formulas can directly affect their retirement planning. Understanding the role Social Security plays in that plan is essential. It helps employees estimate lifetime income, decide when to claim benefits, determine how much to save in the TSP, evaluate survivor and disability protections and judge whether they can afford to retire at a particular age.

Social Security's YouTube channel has a variety of recorded training videos that explain what to know before signing up, earnings limits, how survivor benefits work, how to change your address and even the history of Social Security.

Social Security planning is especially important for retirees who receive the FERS retirement annuity supplement, which is designed to bridge the gap between federal retirement and first eligibility for Social Security. According to OPM, the supplement stops at the end of the month before a retiree turns 62, even if the retiree chooses not to apply for Social Security at that time. As a result, some federal retirees may feel financial pressure to claim Social Security as soon as they become eligible at age 62 to replace the income lost when the supplement ends. Others may choose to delay claiming to achieve a higher monthly benefit, but only if their TSP savings, FERS annuity, spouse's income or other resources can cover the gap.

A 2025 poll released by the Bipartisan Policy Center on Social Security's 90th anniversary underscores why reform has broad public urgency. The survey, commissioned by BPC's American Savings Education Council and conducted by Public First, found that 93% of Americans consider Social Security a valuable federal program and 83% believe addressing its challenges should be a top priority for Congress.

The same poll found deep anxiety about the program's future: 74% of respondents were concerned Social Security could run out before they retire, 80% worried Congress would cut benefits and 41% expected Social Security to be their primary source of retirement income. For federal employees covered under FERS, Social Security is not a supplemental benefit. It is one of the system's three core retirement pillars. If workers broadly fear benefit reductions or insolvency, FERS employees have reason to reassess retirement dates, TSP contribution levels, survivor planning and assumptions about post-retirement income.

The poll therefore reinforces that Social Security reform is not only a national retirement issue but also a direct workforce and financial security issue for current and future federal retirees. The findings also showed bipartisan appetite for action, with majorities of Democrats and Republicans agreeing that lawmakers should work across party lines to strengthen the program.

The current funding debate also echoes the Social Security crisis of 1982, but with an important difference in timing and scale. In the early 1980s, the Old-Age and Survivors Insurance trust fund was projected to run out of money as early as August 1983, leaving the program only months away from being unable to pay full benefits on time. That emergency led to the Greenspan Commission and the 1983 Social Security Amendments, a bipartisan package that accelerated payroll tax increases, delayed cost-of-living adjustments, taxed some benefits, gradually raised the full retirement age and brought newly hired federal employees into Social Security.

Today's crisis is less immediate but potentially harder to solve. Trust fund depletion is still several years away, yet the long-term gap between scheduled benefits and dedicated payroll tax revenue is larger and driven by demographic pressures that have been building for decades. The lesson for today is that waiting until the last minute may preserve political convenience, but it narrows the choices available to workers, retirees and federal employees who need time to adjust their retirement plans.

The PROMISE Act would not guarantee a particular outcome, but it could make it harder for lawmakers to postpone decisions indefinitely. The bill would create a structured congressional process for developing and voting on a long-term Social Security solvency plan.

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No more paper: Navigating OPM’s new digital retirement process

Tammy Flanagan — Thu, 09 Jul 2026 15:00:00 -0400

OPM recently announced that over 95% of retirement applications are now submitted electronically, signaling an end to an agency long defined by physical files, snail mail and manual data entry. With the full launch of the Online Retirement Application (ORA), OPM has officially reached its "Last Day of Paper." While June figures are still pending, May data showed that digital submissions already accounted for 70% to 75% of all applications.

The mission behind ORA is simple: make retirement seamless. By eliminating the physical transport of documents between agencies and payroll offices, the digital system provides better tracking and slashes the risk of human error — the kind that often crops up during manual processing.

The scale of this shift is massive. OPM reports that ORA managed more than 155,000 applications last year. To put that in perspective, processing over 100,000 new retirees in a single year is a rare feat — it has only happened nine times since 2000 — including high-volume years like 2013 and 2025.

While the 2025 data is currently missing totals from November and December, early indicators for 2026 suggest the momentum is holding steady, with nearly 100,000 claims processed through May.

It is possible that OPM's numbers include claims still being worked on. Early data for 2026 suggests another busy year — with nearly 100,000 claims processed through May.

Efficiency is also on the rise. Between January and May, digital claims were finalized in 34 to 66 days on average — a significant improvement over traditional paper-based methods.

October:

Digital claims processed: 1,686 in an average of 45 days

Total claims processed: 8,751 in an average of 79 days

November:

Digital claims processed: 4,363 in an average of 38 days

Total claims processed: 8,707 in an average of 66 days

December:

Digital claims processed: 3,506 in an average of 40 days

Total claims processed: 9,428 in an average of 67 days

January:

Digital claims processed: 6,465 in an average of 48 days

Total claims processed: 15,571 in an average of 77 days

February:

Digital claims processed: 7,054 in an average of 34 days

Total claims processed: 18,149 in an average of 71 days

March:

Digital claims processed: 10,817 in an average of 39 days

Total claims processed: 22,237 in an average of 60 days

April:

Digital claims processed: 7,394 in an average of 50 days

Total claims processed: 17,175 in an average of 78 days

May:

Digital claims processed: 8,761 in an average of 66 days

Total claims processed: 19,433 in an average of 87 days

Modernization isn't just about filing; it's about getting paid faster. OPM is now beginning the approval process while final payroll details are being wrapped up. The new target? Delivering the first pension payment within seven days of retirement for complete applications submitted by a worker's final day on the job.

The digital transition also applies to former employees eligible for deferred or postponed retirement. Although the RI 79-9 paper form may still appear online, ORA is now the mandatory portal for these applications. If you have already submitted a paper file, OPM recommends checking in to see if you can resubmit digitally. Agencies are no longer the gatekeepers for these claims; their role is now to help you navigate ORA so you can take control of the process yourself.

To support this shift, OPM has revamped its online resources for planning and applying: https://www.opm.gov/retirement-center/csrs-information/planning-and-applying/. Here is the essential guidance for your application (pay close attention to the Application tips to avoid common delays):

Applying for retirement

To get payments from CSRS or FERS, you must apply using the Online Retirement Application (ORA) platform.

How to submit your retirement application

If you have been out of federal service for more than 30 days, you must send your application directly to OPM through the ORA portal. If you are still working, talk to your human resources office to start the process.

If you are still working, contact your human resources office to start your application through ORA.

Application processing

Processing your retirement involves your former agency, the payroll office, and finally OPM, which approves your payments.

Reducing delays in processing

You can help avoid delays by applying early and making sure your Official Personnel Folder (OPF) is complete. Also, review our Application Tips to see if you need to include any extra documents.

If you apply early, your human resources office can finish their part before you retire.

How your application is processed

Your human resources office

Your HR office does the following to process your application:

Verify any service not fully documented in your OPF. If documentation is missing, verification may be obtained by contacting federal record centers. If the human resources office is unable to obtain verification, OPM will complete verification upon receipt of your retirement application and records.  However, this process will cause a delay in processing.

Transfer your enrollment under the Federal Employees Health Benefits (FEHB) program to OPM.

Transfer your coverage under the Federal Employees' Group Life Insurance (FEGLI) program to OPM.

Prepare your separation Notification of Personnel Action (SF 50)

Complete the human resources checklist and send your retirement application package to the payroll office.

Your payroll office

Once HR finishes, your payroll office will:

Authorize your final paycheck and lump sum payment for unused annual leave.

Prepare your Individual Retirement Record (IRR), SF 2806 (CSRS) or SF 3100 (FERS), which reflects service, salary history, and annual retirement deductions.

Complete the payroll checklist and submit the final retirement application package to OPM.

Opm claim processing

Once OPM receives your application, they will:

Send you a welcome notice with your Civil Service Annuitant (CSA) claim number.

Obtain any missing information or documents from your retirement application package.

Determine your eligibility for an annuity and to continue health and life insurance benefits.

Calculate your annuity amount.

Send you information about your ability to pay an unpaid deposit or redeposit.

Authorize your annuity payments which are paid by the Department of the Treasury.

Provide you with your retirement benefits booklet which is available through Retirement Services Online.

Your csa claim number

When OPM gets your application, they will send you a welcome notice with your Civil Service Annuitant (CSA) claim number. This number looks like A8DXXXXX0. You must use this number whenever you contact OPM.

With your CSA number, you can log in to Retirement Services Online (RSO). There, you can track your application and update your tax withholding, address, and direct deposit. RSO will be your main portal for managing benefits.

If you have questions before you receive your claim number

If you need to contact OPM early, check your status on the ORA platform first. If it hasn't been sent to OPM yet, then contact your former HR office.

If you didn't use ORA, contact your former HR office to see when they sent your package to OPM. Former employees can contact OPM directly by phone, mail, or help request.

Annuity payment schedule

Monthly payments are sent on the first business day of the month for the month before. For example, your June 1 payment is for May.

Time frame for processing application

For current times, visit our Retirement Processing Times page.

If your records are complete, your application may be processed faster than average. However, it can take longer if we have to contact you or your agency for more info.

Deferred retirement

Deferred retirement is for former employees who left before they were eligible for an immediate annuity. Your annuity starts once you reach the required age and service years (like age 62 with 5 years). Apply through ORA at least 60 days before you want your payments to start.

Note that health and life insurance cannot be restarted with a deferred retirement. To apply, create an ORA account, verify your ID with Login.gov, and submit your application. Be ready with your service dates, military info, and any previous refund or workers' comp data.

Postponed retirement

Postponed retirement is different. It is for those who left at or after minimum retirement age with 10+ years of service but waited to start payments. Unlike deferred retirement, this may let you restart health and life insurance if you had them for the five years before you left.

You must also use ORA and apply at least 60 days before your start date. This date must be the first of a month and before your 62nd birthday. This is critical " — " if you wait until age 62, it becomes a deferred retirement, and you lose your insurance benefits forever.

To apply, create an ORA account and verify your ID. Provide the same info as deferred retirement, plus your start date and insurance info.

This is a bold step forward, but it isn't a magic fix. While ORA breaks the slow paper chains of the past, accuracy remains paramount.

Delays can still happen if you have missing service info, court orders or need Social Security info.

Financial experts still advise keeping a six-month cash reserve while your retirement is finalized. Many employees strategically save annual leave for a lump-sum payout, which is why retirement spikes are common at the end of the leave year.

The "Last Day of Paper" marks a new era for the federal workforce, offering a transparent and efficient route to retirement. For OPM, it's a tool to manage growing retiree numbers with precision. Ultimately, the success of this digital age will depend on clear communication and the workforce's ability to adapt to these new rules.

Here is where employees as well as former employees who are applying for a deferred or a postponed retirement can begin the process: https://retire.opm.gov/portal

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Some TSP funds faltered in June

Erich Wagner — Wed, 01 Jul 2026 12:31:20 -0400

The federal government’s 401(k)-style retirement savings program posted mixed results in June, ending two straight months of consistent growth.

The Thrift Savings Plan’s S Fund, which is made up of small- and mid-size businesses, saw the best performance, gaining 4.34% last month. Since January, the S Fund has grown 18.41%.

The fixed income (F) fund increased 0.25% last month, bringing its 2026 performance to 0.74%. And the G Fund, which is made up of government securities, increased by its statutorily mandated rate of 0.37%. So far this year, the G Fund has swelled 2.18%.

But the I Fund was virtually flat in June, losing 0.03%. That brings the I Fund’s 2026 performance to 16.53%. And the C Fund’s common stocks fell 0.95%, bringing its gains since January down to 10.20%.

Each of the TSP’s lifecycle (L) funds, which shift toward more conservative investments as participants approach retirement age, posted muted gains in June. The L Income Fund, designed for those already making withdrawals, gained 0.30%; L 2030, 0.21%; L 2035, 0.18%; L 2040, 0.16%; L 2045, 0.14%; L 2050, 0.12%; L 2055, 0.06%; L 2060, 0.06%; L 2065, 0.06%; L 2070, 0.06%; and L 2075, 0.06%.

Since January, the L Income Fund has grown 5.24%; L 2030, 8.33%; L 2035, 9.55%: L 2040, 10.21%; L 2045, 10.77%; L 2050, 11.34%; L 2055, 13.41%; L 2060, 13.40%; L 2065, 13.40%; L 2070, 13.40%.

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The Medicare question federal retirees can’t ignore anymore

Tammy Flanagan — Thu, 25 Jun 2026 15:00:00 -0400

Just as Social Security is central to the Federal Employees Retirement System (FERS), Medicare may play an important role in meeting your health insurance needs in retirement. The 2026 Medicare Trustees Report, released on June 9, offers useful insight into future Medicare costs and why federal retirees should think carefully about whether adding Medicare to the Federal Employees Health Benefits Program (FEHB) makes sense.

For federal civilian retirees covered by FEHB, the Medicare decision is often confusing for a few basic reasons:

You are not required to enroll in Medicare to keep FEHB coverage after age 65.
The Medicare Part B premium is substantial and, for some people, may equal or exceed the premium for their FEHB plan.
The choice is rarely as simple as dropping FEHB or skipping Medicare. More often, it comes down to whether adding Medicare to an FEHB plan that “wraps around” Medicare actually improves coverage enough to justify the added cost.
It is almost never advisable to drop FEHB coverage in retirement. Once you leave it, you generally cannot get it back.
The decision gets more complicated when one spouse or family member turns 65 while others remain ineligible for Medicare.
Medicare Part A (inpatient hospital care) and Part B (outpatient care, including doctor visits, lab work and testing) overlap significantly with services already covered under FEHB.

Note: To continue coverage under the Postal Service Health Benefits (PSHB) Program in retirement, you must enroll in Medicare Part B unless you qualify for an exception. For complete PSHB eligibility rules and exceptions, see guidance from the Office of Personnel Management (OPM).

Part B premiums

According to the latest report, Medicare Part B premiums are expected to keep rising.

Most enrollees pay the standard premium — $202.90 per month in 2026 — which covers about 25% of the average program cost for an older beneficiary. Higher-income retirees also pay an Income-Related Monthly Adjustment Amount (IRMAA). For 2026, IRMAA applies when 2024 modified adjusted gross income exceeds $109,000 for single filers or $218,000 for joint filers. Higher-income retirees may also owe IRMAA surcharges for Part D coverage, even when their FEHB plan includes prescription drug coverage through the Medicare Prescription Drug Program at no additional premium.

Late enrollment can also add a permanent penalty. In most cases, the penalty equals 10% of the standard Part B premium for each full 12-month period enrollment is delayed after the initial enrollment period ends. People age 65 or older who are covered by health insurance from current employment may qualify for a special enrollment period and avoid the penalty if they enroll within eight months after that coverage ends.

Some beneficiaries pay less than the standard premium because of the hold harmless provision, which limits premium increases for individuals whose Social Security cost-of-living adjustment is smaller than the Medicare premium increase.

FEHB and Medicare

When deciding whether to enroll in Medicare while keeping FEHB, premiums are only part of the equation. Medicare may reduce out-of-pocket costs, expand provider options and make it worthwhile to choose an FEHB plan that coordinates more effectively with Medicare. That becomes especially relevant in years involving serious illness, injury or ongoing treatment.

The Trustees Report projects the following Part B premiums:

Year	Estimated monthly premium	Annual amount (per person)
2027	$209.50	$2,514.00
2028	$224.50	$2,694.00
2029	$238.50	$2,862.00
2030	$255.50	$3,066.00
2031	$272.10	$3,265.20
2032	$290.20	$3,482.40
2033	$313.60	$3,763.20
2034	$338.50	$4,062.00
2035	$360.60	$4,327.20

The value of combining FEHB with premium-free Part A and Part B depends heavily on how a specific FEHB plan coordinates with Medicare.

Some FEHB plans waive deductibles, copays and coinsurance when Medicare is the primary payer. In practice, that can significantly reduce out-of-pocket costs and, in some cases, offset much of the Part B premium for retirees with higher health care usage.

Examples include Blue Cross Blue Shield Basic Option and Standard Option, MHBP Consumer Plan and Standard, G.E.H.A. High Option and Standard, and Aetna Direct. These plans vary in premiums, provider networks, out-of-pocket maximums and Medicare coordination rules, so retirees need to compare full plan brochures rather than relying on summaries.

To evaluate options, retirees should review Section 4 for catastrophic protection and out-of-pocket maximums, the back cover for premiums and Section 9 for Medicare coordination details. Not all FEHB plans waive cost-sharing when Medicare is primary. The Office of Personnel Management provides a plan comparison tool, and the Checkbook Guide to Federal Health Plans is also widely used.

Some FEHB plans also provide Medicare Part B premium rebates. Examples include Blue Cross Blue Shield Basic Option ($800 annually per person), G.E.H.A. High Option ($1,000) and Aetna Direct ($900). These offsets can materially change the effective cost comparison between plans.

Plans that coordinate well with Medicare tend to fall into two broad patterns: lower-premium designs with stronger Medicare integration or higher-premium plans that trade cost for broader networks and simpler access. HMOs may appeal to retirees who want coordinated care and fewer administrative decisions, while fee-for-service plans may better suit those prioritizing provider flexibility.

FEHB and Medicare Part C, also known as Medicare Advantage

Retirees enrolled in Medicare Parts A and B may also have access to Medicare Advantage options through FEHB carriers. These employer group plans typically bundle medical, hospital and prescription drug coverage, though benefits vary by carrier and geography.

Common features include:

Lower premiums or reductions in Part B costs
Reduced or waived deductibles, coinsurance and copays
Fitness, wellness, home health or over-the-counter benefits
Prescription savings and, in some cases, broader networks or fewer referral requirements

Even as Medicare and FEHB premiums continue to rise, many retirees still find the combination worthwhile when plans include cost-sharing waivers, rebates or Medicare Advantage structures that shift more costs away from point-of-care spending. Higher-income retirees subject to IRMAA face a sharper calculation: higher fixed premiums today versus potential exposure to higher out-of-pocket costs later. For many, the decision is less about optimization than risk tolerance over time.

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Expanding paid leave for federal workers is back on the table

Erich Wagner — Thu, 11 Jun 2026 16:32:06 -0400

A bipartisan trio of House lawmakers on Thursday reintroduced legislation aimed at expanding federal workers’ access to paid leave to handle illnesses and other circumstances not included in the 2019 law granting feds paid parental leave.

The Comprehensive Paid Leave for Federal Employees Act, introduced by Reps. Don Beyer, D-Va., Brian Fitzpatrick, R-Pa., and Chrissy Houlahan, D-Pa., would grant federal employees up to 12 weeks of paid family leave each year to attend to a serious health condition or to care for a spouse, child or parent. The measure would also cover absences needed to help a family member who is the survivor of domestic violence, sexual assault or stalking, as well as to attend to a family member’s deployment into active duty military service.

When Congress passed the 2020 National Defense Authorization Act, the House’s version included a provision providing 12 weeks of paid parental and family leave to feds. But during negotiations with the Senate, the measure was stripped down to remove the family leave portions, and feds became eligible for paid parental leave in October 2020.

The lawmakers’ bill was first introduced in 2021 by then-Rep. Carolyn Maloney, D-N.Y., who previously had spearheaded the campaign for paid parental leave. In a statement, the lawmakers argued that feds’ current access to unpaid family leave is unrealistic given today’s cost of living.

“Unpaid leave may protect a job on paper, but for too many working families, it is not leave they can actually afford to take," Fitzpatrick said. “When a federal employee faces a serious illness or needs to care for a loved one, the choice should not be between earning a paycheck and being present for their family. Without paid leave, workers can be pushed out of careers they have spent years building, agencies lose experienced public servants, and taxpayers lose operational expertise that cannot be easily replaced.”

“We’ve already made meaningful progress by securing paid parental leave for federal employees and expanding paid leave for service members who transition to the federal workforce,” Beyer said. “The next step is expanding family and medical leave to all federal workers, because every American deserves the peace of mind that comes from being able to take time off to care for their health or a loved one without losing a paycheck.”

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Why Social Security’s funding gap matters to federal retirement

Tammy Flanagan — Thu, 11 Jun 2026 15:00:00 -0400

The 2026 Social Security Trustees Report released this week has a familiar warning and a shorter clock.

Social Security is not going anywhere, but the program is moving closer to the point where it will no longer be able to pay full scheduled benefits from its current revenue. The report says the Old-Age and Survivors Insurance trust fund can pay full benefits only until the fourth quarter of 2032. After that, incoming revenue would cover about 78% of scheduled benefits unless Congress acts. If combined with the disability trust fund, the system could pay full benefits until 2034, then benefits will be reduced to about 83% of the promised amount.

To be sure, there is nothing indicating that benefits will stop. Payroll taxes will keep coming in, and Social Security will still pay most of what it owes. But it will mean an automatic cut if lawmakers do nothing.

That is why the comparison to 1983 matters. Congress faced a Social Security emergency then, too, and acted before full checks were interrupted. The difference is that today’s problem is less a sudden cash crisis than a slower, deeper mismatch between promised benefits and projected revenue.

For many Americans, these reductions would cause or worsen impoverishment and create financial hardship for most retirees.

Got a question for federal retirement expert Tammy Flanagan? Send to us at newstips@govexec.com and she might answer it during our live webinar at 2 p.m. on Thurs., June 18.

What the report really says

The trustees track two funds: one for retirement and survivors benefits, and one for disability benefits.

The headline number in 2026 is the retirement fund’s projected depletion in late 2032. The combined projection stretches to 2034, and the disability fund remains in much stronger shape on its own.

The bigger point is that the gap is no longer abstract. It is close enough that every year of delay makes the eventual fix harder. Analysts estimate a 75-year actuarial deficit of 4.42% of taxable payroll, with a present-value shortfall of roughly $31 trillion. In plain English, there is no tiny fix left. Congress can still solve the problem gradually, but not painlessly.

Why the gap keeps growing

Social Security runs mainly on payroll taxes, so the math works best when there are many workers relative to retirees.

Over time, that balance has changed. Birth rates are lower, people live longer and the baby boom generation is already retiring. The result is a smaller worker-to-beneficiary ratio and a larger bill for benefits.

That is the key contrast with 1983: Then, lawmakers were trying to stop an immediate payment crisis. Now, they are confronting a bigger structural problem that has been building for years.

The 2026 report also reflects lower projected fertility, lower assumed immigration and policy changes that reduce tax revenue from the taxation of benefits.

In other words, Social Security is being squeezed by demographics, economics and policy at the same time.

What can Congress actually do?

The menu is not endless.

Congress can raise more revenue, slow the growth of future benefits, change eligibility rules or mix those steps to avoid relying on one substantial solution.

That was the logic in 1983, too.

The difference is scale: Today’s shortfall is larger, and the politics may be tougher.

For most current civilian employees, the Federal Employees Retirement System is built on three parts: the FERS Basic Retirement benefit, also known as a pension, the Thrift Savings Plan and Social Security. In other words, Social Security is not a side benefit for most federal workers and retirees today. It is an important leg of retirement income and a source of disability and survivor protection for families.

For many federal employees, especially those under FERS, the program is an integral part of retirement security rather than an add-on.

Raise more revenue

The most straightforward option is to bring in more money. Congress could raise the payroll tax rate or lift the taxable wage cap so high earners pay more of their income into the system. Supporters say that is the cleanest way to close the gap. Critics say it would reduce take-home pay or increase labor costs.

In 1983, lawmakers accelerated already scheduled payroll tax increases. This time, the debate is more likely to center on the wage cap and broader revenue measures.

Slow future benefits

Another approach is to slow the growth of future benefits, especially for higher earners. That can mean changing the initial benefit formula, trimming annual cost-of-living increases or expanding some form of means testing.

Supporters argue that promised benefits have outgrown dedicated funding.

Opponents warn that even gradual cuts would hit workers who rely heavily on Social Security and have little savings to fall back on.

Raise the retirement age

Raising the full retirement age beyond 67 is another familiar proposal.

Supporters say longer life expectancy makes it reasonable to wait longer for full benefits.

Critics counter that this is a benefit cut by another name, especially for workers in physically demanding jobs or with shorter life expectancies.

Because the 1983 amendments already raised the full retirement age from 65 to 67, any new increase would feel less like a tweak and more like a second major rewrite of Social Security’s retirement promise.

How about a compromise?

Many policy specialists think the only realistic answer is a blended package: some new revenue, some slower growth in benefits and stronger protection for people who depend most on the program.

That was also the basic logic in 1983.

The challenge now is that compromise is harder in a more polarized Congress, and every serious fix creates obvious political losers.

The June 10 House Ways and Means Committee hearing on Social Security

Commissioner Frank J. Bisignano’s June 10 testimony before the House Ways and Means Committee added another wrinkle: Social Security’s finances are now being debated alongside the agency’s day-to-day performance.

In this hearing, the focus was on customer service and modernization. Lawmakers pushed back on whether seniors, people with disabilities and other beneficiaries are experiencing better access. That matters because even a strong solvency plan will be harder to sell if the public does not trust the agency running the program.

Does 1983 still matter?

The Social Security Amendments of 1983 remain the clearest benchmark for what a rescue looks like.

That bipartisan deal, signed into law on April 20, 43 years ago, provided a combination of faster payroll tax increases, taxation of some benefits, a phased increase in the full retirement age and broader coverage for more workers, including all federal employees first hired after 1983, who were then required to pay FICA taxes.

Lawmakers acted before the crisis became unmanageable and spread the pain across multiple groups.

Today’s problem is harder in one important way: It is not just a short-term liquidity scare. It is a long-term structural mismatch between benefits and revenue after decades of delay.

That means Congress needs a broader, more long-lasting package than it adopted in 1983, with more emphasis on revenue and clearer protections for lower-income retirees.

What is Congress waiting for?

Social Security reform is hard for an obvious reason: Every real solution will make some groups unhappy.

Higher taxes anger workers and employers.

Slower benefit growth alarms retirees and near-retirees.

A higher retirement age sparks backlash from labor groups and people in physically demanding jobs.

Lawmakers often promise protection and attack the other side’s ideas rather than vote for a package of trade-offs.

The trouble is that waiting only makes the final fix larger and harsher.

The bottom line

The lesson of the 2026 trustees report is simple: Social Security still has time, but not much easy time left.

The retirement trust fund is projected to run short in 2032, and the combined system will face automatic benefit reductions in 2034 if Congress does nothing. The 1983 comparison shows that bipartisan reform is possible. It also shows why delays are dangerous.

Then, lawmakers acted before the crisis became unmanageable. Now, they face a larger structural shortfall after years of drift.

The most plausible solution is not a miracle fix, but a politically painful compromise that mixes new revenue, slower benefit growth and protections for the people most dependent on the program.

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A record number of feds are retiring. Will that slow your claim?

Tammy Flanagan — Thu, 04 Jun 2026 16:04:20 -0400

Retirement statistics are more than monthly government reports, they offer a practical window into how long claims are taking, where delays may occur and what future retirees should expect. For federal employees planning to leave service, these numbers can help set realistic expectations, guide financial preparation and highlight why understanding the retirement process matters before you submit your application.

New claims processing - This report provides historical data detailing key performance variables, with average processing time presented in days.
Agency retirement case accuracy report - This report reflects the number of non-disability retirement application packages audited and the associated error rate for an agency that had at least 15 cases reviewed in a specified month in the current fiscal year.

Note: The Agency Retirement Case Accuracy Reports do not appear to be current. It is unclear whether the December-July period shown is from 2024-2025 or an earlier year.

How these statistics can help you prepare

Prepare for a period when you may need to rely on personal savings while your CSRS or FERS retirement is being processed.

Within about 2-4 weeks after OPM receives your application, you are usually placed in interim pay status. These temporary monthly payments are estimated and are often much lower than your final benefit.

Set aside about six months of living expenses in case your full benefit is delayed.

If possible, save annual leave and retire near the end of the year so you receive a larger lump-sum leave payout.

A TSP loan may help increase short-term cash reserves, since loans can now be repaid after separation. However, loans are only available while you are employed. They have fees, reduce potential investment growth and may create taxable income if not repaid on time.

Understand how your benefit is calculated, especially when large numbers of retirements are being processed and cases may move at different speeds.

If your case is complex, it may take longer than the average processing time.

High volume can also increase the risk of errors if cases are rushed.

If your agency uses the Online Retirement Application (ORA), your claim may move faster than a paper application.

Public data does not show how long it takes for your application to move from your agency to the payroll provider and then to OPM. Although this should take about four to six weeks after separation, in recent months it has been rumored that it is taking sometimes much longer.

If you have not received your annual leave payout or your Civil Service Active (CSA) number, your claim may not have reached OPM yet.

Key monthly retirement claim trends

Digital (Online Retirement Application) claims received each month:

October 2025 — 6,176 (30% of total claims)
November 2025 — 7,833 (33% of total claims)
December 2025 — 6,055 (45% of total claims)
January 2026 — 9,394 (49% of total claims)
February 2026 — 15,494 (49% of total claims)
March 2026 — 8,830 (59% of total claims)
April 2026 — 8,743 (73% of total claims)
May 2026 — 8,288 (73% of total claims)

Total claims received each month so far in FY 2026 (digital and paper combined), compared with the same months in FY 2016:

What the data suggests

For years, warnings about a federal “retirement tsunami” have been overstated. But with far more employees now at or near retirement age, the recent surge in claims suggests that the long-predicted wave may finally have arrived.

Compared with the same period in FY 2016[1], claim volume in FY 2026 is much higher, increasing the workload for agencies, payroll providers and OPM. The delays in processing resulted from the large numbers of separations, including many that did not result in immediate retirement benefits.

Digital applications are becoming more common, but about one in four claims still arrive on paper.

From FY 2007 to FY 2016, the three cabinet agencies with the most retirements were the Department of Veterans Affairs, the Department of the Army and the Department of the Navy. In FY 2025, those agencies saw sharply different workforce changes, which may affect future retirement patterns.

Once OPM receives a retirement case, the average processing time in FY 2026 is 46 days for digital ORA claims and 73 days for all claims. In May, the averages were 66 days for 8,761 digital claims and 87 days for 10,672 paper claims. That suggests many of the claims completed in May likely reached OPM three to four months earlier, around February or March. Some were likely part of the usual year-end retirements effective Dec. 31, 2025, while others may have been Sept. 30 retirements delayed by heavy workloads in agency HR and payroll offices.

Because averages include both fast and slow cases, some claims move much faster while others take much longer. If you want to know whether your case may be delayed, consider the factors OPM says can slow processing:

Court orders such as a divorce decree or property settlement. These require an additional step and are sent to the Court Order Benefits Branch for review.
Service as a law enforcement officer, firefighter, air traffic controller, Capitol Police, Supreme Court Police or nuclear materials courier, as these cases use a special annuity computation.
Past or active workers’ compensation claims.
Service as a part-time or intermittent federal employee.
Federal service at multiple federal agencies.
Missing documents and forms or incomplete or incorrect information in your retirement application.
Moving without updating your address with OPM.

The larger message in these statistics is clear: retirement processing times, claim volume and case complexity all affect how quickly benefits are finalized. Employees who understand these trends can plan more effectively, build a stronger financial cushion and avoid being caught off guard during the transition from paycheck to annuity.

OPM also publishes the total number of CSRS and FERS annuitants added to the Annuity Roll Processing System (ARPS) from FY 2000 through FY 2025. These totals include retirements processed as of Sept. 30, so most deferred resignation retirements from last year are not reflected in the 2025 figure.

So far in FY 2026, OPM has processed 119,451 retirement claims with four months still left in the fiscal year — a record pace for the past 25 years.

Historical ARPS retirement totals (FY 2000-FY 2025)

Fiscal year — total annuitants added as of Sept. 30

2025 — 112,679
2024 — 95,477
2023 — 108,387
2022 — 114,505
2021 — 96,956
2020 — 99,529
2019 — 109,991
2018 — 109,850
2017 — 96,459
2016 — 99,242
2015 — 99,710
2014 — 105,037
2013 — 138,039
2012 — 111,641
2011 — 82,837
2010 — 76,864
2009 — 87,907
2008 — 86,615
2007 — 92,349
2006 — 103,292
2005 — 94,977
2004 — 90,441
2003 — 81,128
2002 — 74,153
2001 — 77,330
2000 — 77,383

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OPM to set new requirements to ‘verify’ FEHBP enrollments

Erich Wagner — Tue, 02 Jun 2026 16:40:45 -0400

The Office of Personnel Management on Tuesday published regulations aimed at better verifying that family members of federal workers and retirees are eligible for benefits under two of the government’s employer-sponsored health insurance programs.

Last year, Congress enacted a law requiring stricter screening of participants in the Federal Employees Health Benefits Program and Postal Service Health Benefits Program to ensure they are eligible for coverage. That move came following a 2022 Government Accountability Office report finding that the government could be spending upwards of $1 billion per year to cover family members and former spouses of federal workers and retirees who no longer qualified as dependents.

In 2024, OPM instructed agencies to audit a sample of 10% of FEHBP enrollees—the PSHBP had not yet launched at the time—to verify their continued eligibility. But due to a combination of “high transactions” during the 2024 open season and “staffing challenges” last year, the effort never made it off the ground.

In a final rule published to the Federal Register Tuesday, OPM said beginning July 1, federal workers who enroll a child or spouse in health insurance benefits through FEHBP or PSHBP will be required to provide proof of their eligibility. Among the acceptable documentation are government-issued marriage certificates, birth certificates, paternity tests and foster child or adoption paperwork. Parents of adult dependents under 26 may submit their children’s tax returns to confirm eligibility, and in instances involving a disabled adult, a medical certification that they are incapable of “self-support” will be accepted.

Under the new process, agency employing offices or OPM can disenroll a family member of the federal worker “fails to provide adequate documentation” of their eligibility. If someone is disenrolled, they may ask for a reconsideration of that decision within 60 days, but the result of that process is “final.”

While much of the rule is aimed at improving eligibility verification when a dependent is first added to insurance coverage, OPM said it is still preparing for the FEHB Protection Act’s other major provision: an audit of existing enrollments to verify participants’ continued eligibility.

“OPM concurs that there are ineligible family members participating in the program and more can be done to identify and remove them from coverage,” the rule states. “That [GAO] report made several recommendations, many of which OPM concurred with and implemented. While this work progresses, OPM is also preparing for the family member eligibility audit required by the FPA. This audit is a critical piece of addressing ineligible family member coverage and restoring program integrity, but the economic effects of the audit are not included in this rule since it is not affected by this rule.”

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