Retirement buyout


Q.  I am a CSRS/FERS offset employee with 31 years and I have been offered the  VERA/VISP.  I would like to know how my retirement would be calculated for a VERA/VISP and how will it affect my retirement.  How do I find out what the numbers will look like for a retirement check before I decide to take the buyout?  I also have been depositing the max in my TSP account and I see that the government is not required to match it. Is it the agency you work for that decides if the government matches the TSP or not?

Mike Miles:

A. Employer contributions to the TSP, including matching, are only made – and must be made – under FERS. This is not an agency decision.

Reg Jones:

A. To estimate what your annuity would be, use the formulas for each retirement system:


* FERS: 0.01 x your three highest consecutive years of average salary (your high-3) x all years and full months of FERS service


* CSRS: 0.015 x your high-3 x 5 years of CSRS service, plus


* 0.0175 x your high-3 x 5 years of CSRS service, plus


* 0.02 x your high-3 x all remaining years and full months of CSRS service


Unused sick leave that doesn’t exceed the amount you had to your credit when you transferred to FERS, will be added to your CSRS service. If you retire before 2013, half of any remaining hours will be added to your FERS service. In both cases, hours that don’t add up to a month (approximately 174 hours) will be dropped.


As a FERS employee, if you retire before age 62, you will be entitled to the special retirement supplement, which is approximately the amount of Social Security benefit earned while you were a FERS employee. Here’s the formula: Social Security benefit estimate provided by the Social Security Administration x total years of FERS service rounded up to the next higher year divided by 40.

The basic rules on the amount of a Voluntary Separation Incentive Payment are as follows: An amount equal to the severance pay you would be entitled to, without an adjustment for any previous payments made or an amount determined by the head of your agency, not to exceed $25,000. Only you agency can tell you if you’d be eligible for a VSIP and, if so, in what amount.




About Author

Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to and view his blog at

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