Expanded Options in Retirement with New Bill

[vc_row][vc_column width=”2/3″ el_class=”section section1″][vc_column_text]The House recently introduced a new bill with expanded options for some retiring federal workers. As of this writing, the bill is only sponsored by one person so far, so the chances of it passing in Congress and becoming law are slim. Still, this is a topic that could be of interest to the proposed employees this bill would affect, those who were once employed seasonally or temporarily by the federal government during the onset of their careers.

A Democrat out of Washington, Derek Kilmer was the one who proposed this bill, and stated that the bill would ensure that all federal workers have the chance to retire at the same time no matter how they started their careers.

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Most federal full-time positions have deductions taken out for FERS, or the Federal Employees Retirement System, a withdrawal from the employees’ paycheck to use as credit for their own pensions. For most employees hired after January of 1989, FERS had disallowed a “non-contributory service” deposits. For people before that time, when there were to retirement deductions as part of their federal paycheck, the credit was optional for all employees, even those serving temporarily.

When FERS began in 1989, a court order decreed that those workers employed before then must be put in in order to receive any money back in their retirement, usually at 1.3 percent of their pay. While it was not a requirement, if one had not paid into this, it would not count towards their retirement fund. This proposed bill would do away with that requisite, making credible services that had not been previously put in before January of 1989 not necessary.

The co-sponsor of the bill, a Republican from Oklahoma, Tom Cole, said in his official statement that the existing policy doesn’t provide any benefit to federal employees or the federal government, but that the buy-back option gives workers additional credit toward retirement, which is an option they currently do not have available.

The Congressmen claim that the Federal Retirement Fairness Act would give time for older employees hired before 1989 to buy-in for that time they worked temporarily prior to that 1989 cut off date.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_single_image image=”36753″ img_size=”292×285″ style=”vc_box_shadow”][/vc_column][/vc_row]