Many people in the United States spend their entire life working for the United States Postal Service (USPS). This is a rewarding career and comes with many benefits that include an excellent retirement plan. The USPS has two different retirement programs, depending on your tenure and when you began service.
You can fall under the Federal Employment Retirement System (FERS) or the Civil Service Retirement System (CSRS), depending on whether you began your service before or after 1984. The standard age for retirement at the USPS is 65, but your length of service and other factors can alter when you are eligible.
USPS Pension Calculator
The first challenge in calculating your retirement annuity is to determine which system you must use. If you were hired after 1984, you will fall under the FERS system. Those who began their service before 1984 fall under the CSRS system.
FERS typically pays less than CSRS when you use a USPS pension calculator, but you have access to Thrift Savings Plans (TSP) and Social Security under this system. The total amount between these two systems is typically close when you add all the other benefits under FERS to the base amount.
CSRS USPS Retirement Calculator
For employees who began their service after 1984, your retirement annuity will be calculated using the CSRS system. This system uses a standard contribution from your paycheck and does not use the High 3 figures system. Under this system, you will usually contribute between 7-8 percent of your paycheck toward retirement. However, you will not receive any additional funds from the Thrift Savings Plan or social security benefits.
FERS USPS Retirement Calculator
The FERS system uses the High 3 figures to calculate your benefits. This means that you will receive 1 to 1.1 percent of your highest three yearly salaries over three consecutive years.
If your high 3 figures were around $60,000, and you have worked for the postal service for 20 years, the USPS pension calculator puts your monthly annuity at around $1,007 per month. There will be deductions of about $12,000 per year. To add to this amount, you will receive Social Security and payments from your TSP. This is a significant boost to the base amount.
USPS Retirement Age
The USPS retirement calculator that you can use depends on when your service date began. The standard retirement age is 65, regardless of the number of years of service you have. You can retire with 20 years of service or 40 years of service. In some cases, the USPS will offer early retirement under Voluntary Early Retirement Authority (VERA). This is a method to reduce extra workers.
To be eligible for VERA retirement, you must be at least 50 years old and have a minimum of 20 years of service. If you have over 25 years of service, you can retire at any age. To be eligible for retirement under this program, you must be in good standing and cannot be terminated for poor performance or misconduct.
Many factors are used to calculate your USPS retirement annuity including your age, the number of years of service and which system you fall under. The best place to get answers about your particular circumstance is to contact the Office of Personnel Management (OPM). This is the office responsible for managing retirement services.
Another resource for answers to common questions is the OPM Support Center. Using this resource, you can often find answers to questions like how Cost-of-Living Adjustments (COLA), FEGLI life insurance enrollment and disability affect your retirement. You can get your monthly payment statement and get specific information about your account through the OPM website.
Adam Luehrs is a writer during the day and a voracious reader at night. He focuses mostly on finance writing and has a passion for real estate, credit card deals, and investing.