The Federal Employees Retirement System (FERS) Supplement is a benefit that remains relatively unknown to many federal employees. If you’re reading this, congratulations—you’re among those who know about this powerful retirement tool! The FERS Supplement serves as a financial bridge for eligible federal employees who retire before age 62, ensuring income stability until they can begin collecting Social Security.
What is the FERS Supplement?
The FERS Supplement is designed to provide financial assistance to retirees who leave federal service before reaching age 62. Since Social Security benefits are not available until age 62, the supplement ensures that federal employees who retire early still receive a portion of their expected Social Security benefits until they become eligible to collect them.
This supplement is officially known as the Special Retirement Supplement (SRS) and is also referred to as the Annuity Supplement or Social Security Supplement in different documents and sources. Despite the various names, the benefit operates the same way. (Note: Elimination of the supplement is one of several measures reducing the value of federal benefits being considered in this Congress.)
Who is Eligible for the FERS Supplement?
Not all FERS employees qualify for the supplement. To be eligible, you must:
Be covered under FERS – CSRS (Civil Service Retirement System) employees are not eligible.
Be younger than 62 – The supplement only applies to retirees under 62.
Retire with an immediate retirement (not MRA+10) – You must retire with an immediate annuity and meet one of the following conditions:
○ 30 years of creditable service and have met your Minimum Retirement Age (MRA)
○ At least 20 years of service and be at least 60 years old
MRA varies based on birth year, typically falling between ages 55 and 57. Employees who retire under the MRA+10 provision (minimum retirement age with at least 10 years of service) are not eligible for the FERS Supplement.
How the FERS Supplement Works For a VERA Retirement
VERA stands for Voluntary Early Retirement Authority. It was created for agencies that are downsizing, restructuring, or reshaping of some kind.
Yes, you can get the FERS supplement under a VERA retirement. However, the one difference is that the supplement wouldn’t start until your MRA (minimum retirement age) per the chart above.
The supplement would then continue to be paid to you until age 62.
Special Provisions
Federal employees in special provisions—such as law enforcement officers (LEOs), firefighters, air traffic controllers, and some other special categories—qualify for the FERS Supplement under different rules. These employees can retire earlier and still receive the supplement due to the nature of their work. They do not have to wait until their MRA if they retire with a full retirement. To qualify for a full retirement, they must be:
● Age 50 with at least 20 years of service
● Any age with at least 25 years of service
How to Calculate the FERS Supplement
To estimate your FERS Supplement, use the following formula:
(Years of Creditable Civilian Service / 40) x Age 62 Social Security Benefit
For example, if you have 30 years of creditable service and your estimated Social Security benefit at age 62 is $1,500:
(30 / 40) x $1,500 = $1,125 per month
This supplement lasts until you turn 62, at which point it stops regardless of whether you begin collecting Social Security.
Where to Find Your Age 62 Social Security Benefit
Your Social Security statement, which can be accessed through SSA.gov, provides an estimate of your age 62 benefit.
Taxation of the FERS Supplement
Unlike Social Security, where only up to 85% of benefits may be taxed, 100% of your FERS Supplement is subject to federal income tax. Depending on your total retirement income and location, you may also owe state taxes.
Reductions to the FERS Supplement
Your FERS Supplement may be reduced or eliminated if you earn additional income. Additional income does not include the FERS pension or TSP withdrawals but rather earned income from jobs. This reduction follows Social Security’s “earnings test”:
● For every $2 earned over the annual income limit, your FERS Supplement is reduced by $1.
● In 2025, the income limit is $23,400, meaning even part-time work could significantly impact your supplement.
● Reductions occur after reporting earnings through an annual survey conducted by OPM.
Example of Supplement Reduction
If you earn $30,000 in a year:
● $30,000 – $23,400 = $6,600 (over the limit)
● $6,600 / 2 = $3,300 reduction per year
● If your FERS Supplement was $1,200 per month, it would be reduced by $275 per month.
Common Questions About the FERS Supplement
How Do I Apply for the FERS Supplement?
You do not need to apply for the FERS Supplement. If eligible, it is automatically included in your monthly pension payments once your retirement application is fully processed.
How Long Does It Take to Receive the FERS Supplement?
OPM’s processing times can be lengthy, often taking 6–12 months. Until your retirement package is finalized, you will receive interim payments at 60–70% of your estimated pension, which will not include the FERS Supplement. Once OPM completes the process, you will receive back pay for any missed supplement payments.
Will the FERS Supplement Be Eliminated?
There have been discussions in Congress about eliminating or modifying the FERS Supplement, but as of 2025, it remains available. Employees planning their retirement should stay informed about potential legislative changes.
Does the FERS Supplement Require Me to Take Social Security at 62?
No, you do not have to start Social Security at 62. However, the FERS Supplement stops at 62 regardless of when you begin Social Security, so you must plan accordingly to cover any income gap if you delay claiming benefits.
Final Thoughts: Planning for Retirement with the FERS Supplement
The FERS Supplement is a valuable benefit that allows federal employees to retire early without facing an immediate loss of income. However, its complexities—including eligibility criteria, tax implications, and potential reductions—make it essential to understand how it fits into your overall retirement strategy.
For those considering early retirement, understanding the FERS Supplement’s role in your financial plan can help ensure a smooth transition into retirement. Consulting a financial advisor familiar with federal benefits is a wise step in maximizing this advantage.
If you’re eligible for the FERS Supplement, take the time to calculate your potential benefit, factor in tax obligations, and plan for any potential income gaps post-age 62. With proper preparation, the FERS Supplement can be a powerful tool in achieving a financially secure retirement.
Now with all this being said, we do encourage you get a Full Free Retirement review to put it all together to help you maximize all three legs of your income and let us also talk to you about all of your other benefits and what you should keep and what you should let go into retirement.
