You’ve Got Years of FERS Service—Now Here’s How to Make It Work Harder

Missy E
November 14, 2025

Key Takeaways

Leveraging your FERS service effectively in 2025 requires a strategic approach to timing, coordination with Social Security, and understanding annuity formulas.
By optimizing your benefits through service credit, survivor options, and the Thrift Savings Plan (TSP), you can significantly increase your retirement income.

Your FERS Service Is a Powerful Tool—Use It Wisely

If you’ve put in years of work under the Federal Employees Retirement System (FERS), you’ve already laid a strong foundation for a secure retirement. But simply having the years isn’t enough. You need to know how to turn that time into lasting income and protection. With the right strategies in 2025, your FERS service can do a lot more than just provide a basic annuity.

Understand the Value of Your Years of Service

Your creditable service time directly impacts the amount of your FERS basic annuity. The more years you have, the higher your monthly benefit. Here’s how the calculation works:

High-3 Average Salary: This is the average of your highest-paid consecutive 36 months of service.
Service Multiplier: Most employees use 1%, but if you retire at age 62 or later with at least 20 years of service, the multiplier increases to 1.1%.
Years of Creditable Service: Includes actual federal service, military buyback (if applicable), and any sick leave credit.

The formula: High-3 x Years of Service x Multiplier = Annual Annuity.

By 2025, the average FERS retiree with 30 years of service can expect a substantial benefit if their salary history supports it. But don’t stop at the base formula—there are ways to make this number grow.

1. Add Service Credit You Might Be Overlooking

Service credit can boost your annuity without requiring more years of work. In 2025, take full advantage of these opportunities:

Unused Sick Leave: Every 174 hours converts to one month of additional creditable service. While it doesn’t count toward eligibility, it does increase your annuity amount.
Military Buyback: If you had active-duty service, you can still make a deposit to count those years under FERS. This one-time payment could result in thousands more per year in retirement.
Refunded Service: If you took a refund of FERS contributions in the past, repaying that amount now allows you to reclaim those years.

These strategies can significantly enhance your benefit without extending your federal career.

2. Time Your Retirement Carefully

The timing of your retirement has a direct impact on your monthly annuity.

Minimum Retirement Age (MRA): Depending on your birth year, this ranges from 55 to 57. Retiring at MRA with 30 years of service avoids any age reduction.
Early Retirement (MRA+10): You can retire with as few as 10 years of service at your MRA, but your annuity will be permanently reduced unless you postpone it.
Age 62 Milestone: If you wait until age 62 and have at least 20 years of service, your annuity is calculated with the 1.1% multiplier, giving you a 10% bump.

In 2025, strategic timing can make a difference of hundreds per month for life. Planning around these age benchmarks matters.

3. Use the Special Retirement Supplement While It Lasts

If you retire before age 62 with at least 30 years of service, you may be eligible for the FERS Special Retirement Supplement (SRS). This bridges the gap between retirement and Social Security eligibility.

Ends at 62: The SRS automatically stops the month you turn 62, whether you claim Social Security or not.
Earnings Test Applies: If you earn more than $23,480 in 2025, your SRS benefit could be reduced.

Understanding the value—and limitations—of the SRS can help you better plan your post-retirement income, especially if you’re retiring before age 62.

4. Make Informed Choices About Survivor Benefits

FERS allows you to leave a survivor annuity to a spouse, but it comes with a cost.

Full Survivor Benefit: Reduces your annuity by 10% but provides your spouse with 50% of your annuity if you pass away.
Partial Survivor Benefit: Costs 5% of your annuity and pays 25% to your spouse.
No Survivor Benefit: Only an option if your spouse consents in writing.

Choosing the right survivor option is not just a financial decision—it affects insurance, health coverage, and long-term planning. In 2025, the survivor election remains a key decision during retirement paperwork.

5. Coordinate with Your Thrift Savings Plan (TSP)

Your TSP account is a vital part of your overall retirement income. How you use it in combination with your FERS annuity and Social Security can shape your financial picture for decades.

TSP Withdrawals: Starting at age 59½, you can withdraw from TSP without penalty. Required Minimum Distributions (RMDs) begin at age 73.
TSP Strategy: Consider how much income to take from TSP early in retirement versus later. A gradual drawdown may reduce tax burdens and keep you in a lower tax bracket.
TSP Investment Allocation: Review your mix of funds to ensure it reflects your retirement timeline and risk tolerance.

In 2025, retirees are more focused than ever on balancing annuity security with TSP flexibility.

6. Delay Social Security for Higher Monthly Payments

Although you can start claiming Social Security at age 62, delaying benefits boosts your monthly check.

Full Retirement Age (FRA): For those born in 1963, FRA is 67 in 2025.
Delayed Credits: For each year you wait beyond FRA up to age 70, your benefit grows by about 8% annually.

If your FERS annuity and TSP income cover your early retirement years, consider postponing Social Security to lock in a larger benefit.

7. Revisit Your Federal Employee Health Benefits (FEHB)

Health care is one of the most valuable benefits in retirement. FERS retirees can continue FEHB into retirement if they meet eligibility rules.

Eligibility: You must have been enrolled in FEHB for at least five consecutive years before retirement.
Cost Sharing: You continue to pay the same share of premiums as active employees, though premiums have increased by 13.5% in 2025.
Medicare Coordination: At age 65, you become eligible for Medicare. Many retirees choose to enroll in Part B to lower out-of-pocket costs when paired with FEHB.

Careful coordination between Medicare and FEHB in retirement can prevent large medical expenses and streamline your care.

8. Stay Aware of Legislative Changes

Your retirement benefits are not set in stone. Legislative updates in 2025 may affect FERS retirees:

Proposed Locality Pay Removal: A bill proposes to exclude locality pay from the high-3 calculation. If passed, this would lower future annuities for employees in high-cost areas.
FEHB Contribution Changes: Lawmakers are considering shifting from a percentage-based premium model to a flat-rate voucher, which could increase your out-of-pocket health care costs.
TSP G Fund Reforms: Proposals to remove the government subsidy could reduce returns for conservative investors.

Staying informed ensures you can adjust your retirement strategy before policy changes impact your bottom line.

Make the Most of Your FERS Service in 2025 and Beyond

You’ve worked hard to earn your years of FERS service—now it’s time to let those years work for you. Whether you’re planning your exit in the next few months or fine-tuning your long-term strategy, every decision you make now shapes your financial future.

Take the time to:

Calculate your potential annuity based on your current service.
Evaluate your TSP drawdown strategy.
Assess whether you should delay Social Security.
Understand how Medicare interacts with FEHB.
Review the impact of survivor benefits.

If you’re unsure about the best path forward, speak with a licensed agent listed on this website to receive personalized, professional retirement advice.