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Your FERS Annuity Supplement Disappears at 62—Here’s What You Should Do About It

Missy E
November 14, 2025

Key Takeaways

Your FERS annuity supplement stops at age 62, even if you don’t claim Social Security right away. Planning ahead helps you avoid a sudden drop in income.
Alternative sources like Social Security, TSP withdrawals, and personal savings become essential to replace that lost income and keep your retirement plan on track.

Understanding the FERS Annuity Supplement

The Federal Employees Retirement System (FERS) provides a unique benefit called the FERS annuity supplement

. This payment acts as a bridge, offering early retirees a temporary boost in income before they become eligible for Social Security. It’s designed to help federal employees who retire before age 62 maintain financial stability.

The supplement begins once you retire under an immediate FERS retirement and meet certain criteria. But one critical detail catches many off guard: it ends at age 62, regardless of whether you begin collecting Social Security at that time.

Let’s break down what this means for you and what steps you should consider taking now.

Why the Supplement Ends at 62

The purpose of the FERS supplement is to replicate the Social Security benefit you would receive if you were old enough to claim it. Since Social Security eligibility begins at 62, the supplement stops once you reach that milestone.

However, just because you can claim Social Security at 62 doesn’t mean you should. If you delay your claim, your monthly benefit increases. But that choice also means you’ll need a strategy to fill the income gap left by the disappearing supplement.

What You Should Expect Financially at 62

When the supplement ends, you may face a drop in your monthly income. Here’s what that might look like:

The average FERS supplement ranges from $800 to $1,200 per month, depending on your years of service and earnings history.
At 62, that amount goes away unless you’ve claimed Social Security or tapped other sources.

The loss may not be devastating if you’ve planned ahead. But if you’re not ready, it can disrupt your financial routine.

What to Do Before You Turn 62

Being proactive can help you transition smoothly. Here are several actions to consider:

1. Estimate Your Social Security Benefits

Use the official Social Security estimator to get a clear picture of your expected monthly benefit at different claiming ages:

Age 62 (earliest eligibility)
Full retirement age (66 or 67, depending on your birth year)
Age 70 (maximum benefit)

This comparison will help you weigh the trade-offs between claiming early or waiting.

2. Analyze Your TSP Withdrawal Strategy

By age 62, most FERS retirees have access to their Thrift Savings Plan (TSP) funds. The way you draw from TSP can make a big difference in how long your money lasts.

Consider fixed monthly withdrawals or the required minimum distribution (RMD) approach starting at age 73.
Review potential tax consequences. Traditional TSP withdrawals are taxable, while Roth TSP funds are tax-free under qualifying conditions.

3. Assess Other Retirement Income Sources

In addition to Social Security and TSP, you might have:

Personal savings
IRA distributions
Rental income or part-time work

Make sure you understand how these sources interact with each other and how they can replace the lost supplement.

4. Adjust Your Spending Plan

It’s wise to revisit your monthly budget before the supplement ends. Knowing in advance how much less you’ll receive allows you to:

Cut discretionary spending temporarily
Delay large expenses like vacations or home renovations
Redirect income from other sources to cover basic needs

5. Evaluate Whether to Claim Social Security Early

If you decide to claim Social Security at 62, your benefit will be permanently reduced. But in some situations, it may be worth it:

You need the income to meet essential expenses
You have health concerns that reduce life expectancy
You’re coordinating benefits with a spouse

Waiting may be better if you expect to live a long time and can bridge the gap with savings or TSP funds.

Common Misunderstandings About the FERS Supplement

Understanding what the FERS supplement is not can prevent poor planning:

It is not part of your Social Security benefit and does not impact your Social Security calculation.
It does not continue beyond 62, even if you delay Social Security.
It is not subject to cost-of-living adjustments (COLAs).

These distinctions are crucial as you build your long-term retirement income plan.

The Role of Earnings and the Earnings Test

If you return to work after retiring and are under 62, your FERS supplement may be reduced or eliminated entirely due to the earnings test. This rule is similar to the Social Security earnings limit.

In 2025, the annual limit is $23,480. If you earn above that amount, your supplement will be reduced by $1 for every $2 over the limit. That means:

Working part-time might still allow you to receive the supplement
Full-time employment will likely eliminate the payment

Once you reach 62, the supplement ends regardless of earnings, and the Social Security earnings test applies if you claim early benefits and continue to work.

Tax Considerations After the Supplement Ends

The end of the supplement also affects your tax picture. Here’s how:

The FERS supplement is considered taxable income.
If you replace it with Social Security, a portion of those benefits may be taxable depending on your combined income.
TSP withdrawals can add to your taxable income unless taken from a Roth account.

You may want to work with a financial professional or tax advisor to estimate your tax bracket after 62 and adjust your withdrawal strategy accordingly.

Planning for the Long Haul

The period between 62 and 70 can define your financial success in retirement. Making smart moves during this window helps preserve your savings and maximize benefits later on.

Here are a few long-term strategies:

Delay Social Security if possible. Each year you delay increases your benefit by about 8%.
Limit large withdrawals. Tapping too much from your TSP or savings too early could deplete your resources.
Reassess your income mix annually. Your needs and the markets can change.
Consider annuitizing a portion of your TSP. A steady, guaranteed income stream can help fill the gap and reduce risk.

What If You Already Turned 62 Without a Plan?

If you’ve already hit age 62 and the supplement has stopped, it’s not too late to act:

Review your Social Security options right away
Build a temporary withdrawal schedule from your TSP or savings
Trim non-essential spending while adjusting your plan
Seek professional financial guidance to create a new roadmap

Even if you didn’t plan ahead, small adjustments can help you regain control.

Make the Most of Your Transition at 62

The end of your FERS supplement doesn’t have to be a crisis. With proper planning and awareness, it becomes just another step in your retirement evolution. Think of it as a pivot point, not a pitfall.

Now is the time to review your financial resources, adjust your budget, and decide the best timing for Social Security. And if you need help making those decisions, connect with a licensed agent listed on this website for professional advice tailored to your unique situation.