Does Military Time Count Towards Federal Retirement?
For individuals who have served in the military and have also worked in the federal government, understanding how their military time can impact their federal retirement benefits is crucial. In this article, we will delve into the details of how military time can count towards federal retirement and provide valuable insights for those who are planning for their retirement.
Direct Answer: Does Military Time Count Towards Federal Retirement?
Yes, military time can count towards federal retirement. The Federal Employees Retirement System (FERS) allows federal employees to include their military service when calculating their retirement benefits. This is known as Military Service Credit. Military service credit can increase an individual’s retirement benefit by up to 5% for each year of military service.
How Military Time Counts Towards Federal Retirement
To understand how military time counts towards federal retirement, it’s essential to know the different types of military service credit that can be applied:
- High-3: This is the average of the highest 36 months of pay, including military pay. High-3 is used to calculate the retirement benefit for federal employees who are not eligible for FERS.
- FERS: This is the average of the highest 36 months of pay, including military pay, for federal employees who are eligible for FERS.
Military Service Credit Eligibility
To be eligible for military service credit, federal employees must meet the following requirements:
- Age: The employee must be at least 50 years old or older to apply for military service credit.
- Service: The employee must have served in the military for at least 5 years, with at least 1 year of active duty service.
- Discharge: The employee must have been honorably discharged from the military.
Calculating Military Service Credit
To calculate military service credit, federal employees can use the following formula:
- Total Military Service: The total number of months of military service is calculated by adding the number of months of active duty service and the number of months of reserve service.
- Percentage of Credit: The percentage of credit is calculated by dividing the total number of months of military service by 120 (the maximum number of months of military service that can be credited).
- Credit: The credit is calculated by multiplying the percentage of credit by the employee’s High-3 or FERS pay.
Table: Calculating Military Service Credit
| Total Military Service | Percentage of Credit | Credit |
|---|---|---|
| 12 months | 10% | 10% of High-3 or FERS pay |
| 24 months | 20% | 20% of High-3 or FERS pay |
| 36 months | 30% | 30% of High-3 or FERS pay |
| 48 months | 40% | 40% of High-3 or FERS pay |
| 60 months | 50% | 50% of High-3 or FERS pay |
Benefits of Including Military Time in Federal Retirement
Including military time in federal retirement can have several benefits, including:
- Increased Retirement Benefits: Military service credit can increase an individual’s retirement benefit by up to 5% for each year of military service.
- Improved Retirement Security: Including military time in federal retirement can provide a more secure retirement income stream.
- Flexibility: Federal employees can choose to include their military time in their retirement calculation, allowing them to optimize their retirement benefits.
Conclusion
In conclusion, military time can count towards federal retirement, and understanding how it can impact federal retirement benefits is crucial for individuals who have served in the military and have also worked in the federal government. By including military time in federal retirement, individuals can increase their retirement benefits, improve their retirement security, and gain flexibility in their retirement planning.
