Deferred annuity


Q: I plan on taking a deferred retirement at age 54 with 32 years of federal service in May 2012. I have been in the Federal Employees Health Benefits program since 1985. My wife plans taking a job in the federal government prior to me taking the deferred retirement. When she is hired, the plan is for me to transfer to her FEHB.

When I reach age 56 in May 2014, how will the deferred retirement impact the three parts of the Federal Employees Retirement System (basic retirement with high-3, etc.; supplement, which should be 32/40 x what I receive in Social Security at age 62; and Thrift Savings Plan), as well as my FEHB and my sick-leave reimbursement (current projection at 1,400 hours)?

A: Your deferred annuity will have no direct effect on your TSP account. Because you will have separated from service before the year in which you reach age 55, you will be subject to early withdrawal penalty rules until you reach age 59 1/2. You could avoid this restriction if wait to separate until Jan. 1, 2013.

(Read more about this question on the Federal Times Ask The Experts: Federal Retirement blog.)


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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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