If You’re Retiring Under FERS, Watch These Five Critical Numbers Before You File Anything

Missy E
November 14, 2025

Key Takeaways

Before retiring under FERS, you need to pay close attention to five numbers that can greatly influence your income, benefits, and financial stability after you leave.
Filing retirement paperwork without carefully reviewing these figures could result in delayed benefits, lower annuity payments, or unexpected gaps in healthcare coverage.

Five Critical Numbers You Must Know Before Filing for FERS Retirement

If you are planning to retire under the Federal Employees Retirement System (FERS) in 2025, you are making one of the most significant decisions of your career. Timing matters. The numbers matter even more. Misjudging them can set you back financially for years. Here are the five numbers you must focus on before you submit your retirement application.

1. Your Minimum Retirement Age (MRA)

Your MRA is the earliest age at which you can retire with immediate benefits under FERS. In 2025, your MRA depends on your birth year:

Born before 1948: 55 years
Born between 1948 and 1952: 55 to 56 years
Born between 1953 and 1964: 56 years
Born between 1965 and 1969: 56 to 57 years
Born in 1970 or later: 57 years

Why it matters:

If you retire at your MRA with fewer than 30 years of service, you may be subject to a permanent reduction in your annuity.
Retiring under “MRA + 10” rules allows retirement with at least 10 years of service but carries a 5% reduction in benefits for every year you are under 62 unless you defer.

2. Your “High-3” Average Salary

FERS calculates your basic retirement annuity based on your “High-3” average salary. This is the average of your highest-paid consecutive 36 months of service.

Why it matters:

Even small differences in your High-3 can result in significant lifetime differences in retirement income.
Overtime, bonuses, and locality pay may factor in depending on your employment status.
Your High-3 directly affects your annuity formula:
- 1% of High-3 x years of service (if under age 62 at retirement)
- 1.1% of High-3 x years of service (if retiring at 62 or older with at least 20 years of service)

3. Your Creditable Years of Service

Creditable service includes all years and months you have worked under FERS. It may also include military service if you completed a military deposit.

Why it matters:

A few months can tip you into a higher benefit calculation or allow you to qualify for an unreduced pension.
You must complete at least 5 years of civilian service to be eligible for a FERS retirement annuity.
Completing 20 years of service before age 60 qualifies you for immediate retirement with full benefits.

Important 2025 reminders:

Any unpaid military deposits must be settled before you retire to count toward creditable service.
Sick leave can add to your creditable service for annuity calculation purposes but cannot be used to meet eligibility.

4. Your Social Security Timeline

Under FERS, your retirement income is a three-legged stool: your annuity, your Thrift Savings Plan (TSP), and Social Security. Your eligibility for Social Security affects when and how much you receive.

Important Social Security figures for 2025:

Earliest claiming age: 62
Full retirement age (FRA) if born in 1963: 67
Earnings limit if under FRA: $23,480/year
Earnings limit during year you reach FRA: $62,160

Why it matters:

If you retire before 62, you may qualify for the FERS Annuity Supplement, which approximates your age-62 Social Security benefit but ends at 62.
Claiming Social Security before your FRA results in a permanent reduction in benefits.
Earning above the limit before FRA could reduce your Social Security payments temporarily.

5. Your FEHB Eligibility and Costs

Maintaining your Federal Employees Health Benefits (FEHB) coverage into retirement is one of the most valuable aspects of federal retirement, but it requires careful planning.

Eligibility requirements in 2025:

Must be enrolled in FEHB for the 5 years immediately preceding retirement (or since your first opportunity if less than 5 years).
Must retire on an immediate annuity (not deferred).

Why it matters:

Failure to meet the 5-year rule means permanent loss of FEHB in retirement.
Premiums remain at the same government-subsidized rate into retirement but can rise annually.
Retirees often coordinate FEHB with Medicare at 65 to manage healthcare costs better.

How to Calculate Your Retirement Benefits in 2025

Once you have these five critical numbers, you can start estimating your expected retirement benefits. Here’s a simple breakdown:

Basic FERS Annuity Calculation:

If under age 62 or fewer than 20 years of service: High-3 average salary x 1% x years of creditable service
If age 62 or older with 20+ years: High-3 average salary x 1.1% x years of creditable service

FERS Annuity Supplement:

Available if retiring before age 62 with immediate annuity eligibility
Ends the month you turn 62

Social Security Benefit:

Estimate based on SSA statement adjusted for early or late claiming

TSP Withdrawals:

Depends on your account balance, investment returns, and distribution strategy

Healthcare Costs:

FEHB premiums
Medicare premiums starting at 65
Potential co-pays, deductibles, and coinsurance

Timing Your Retirement: A 2025 Perspective

In 2025, the timing of your retirement within the calendar year can have a noticeable impact on your benefits and tax situation.

Considerations:

Retiring at the end of the year maximizes your annual leave payout.
Retiring mid-year might align better with reaching age milestones (such as MRA or 62).
Delaying retirement by just a few months can increase your High-3 average and your annuity.
End-of-year retirements often mean starting retirement in a lower tax bracket the following year.

Potential Pitfalls to Avoid in 2025

Even with careful planning, a few common mistakes can derail your retirement goals:

Ignoring the MRA + 10 penalty: Retiring too early without deferring your annuity can permanently slash your benefits.
Miscalculating service time: Overlooking temporary time or not buying back military service can lower your annuity.
Underestimating healthcare costs: Not planning for the coordination of FEHB with Medicare can result in unexpected expenses.
Not accounting for Social Security earnings limits: Working after retirement can temporarily reduce early Social Security benefits.

Practical Steps to Take Before Filing Your Retirement Application

Before you officially file, make sure you:

Confirm your eligibility based on MRA, service time, and FEHB participation.
Request a retirement estimate from your agency’s HR office.
Consider a retirement counseling session.
Review your High-3 calculation.
Verify all military service deposits are complete.
Understand the impact of sick leave credit.
Plan your withdrawal strategy for your TSP.
Decide your Social Security claiming age based on your financial needs.

Preparing for a Confident Transition into Retirement

Understanding these five numbers gives you the clarity and confidence to move into your next phase of life without unpleasant surprises. FERS retirement can still provide a strong financial foundation in 2025—if you handle the numbers carefully.

If you have any questions about your individual retirement situation, it’s wise to speak with a licensed professional listed on this website who can help you personalize your retirement strategy.