Planning for Retirement: How FERS and Social Security Fit Together

Your FERS pension benefit is based on your length of federal service and salary history. Most federal employees contribute 0.8% of salary towards FERS, with some contributing more. The government matches contributions at higher rates. You become vested after 5 years then can collect pension payments in retirement.

Since your pension will be a fixed monthly payment for life, determining that projected amount early allows better retirement planning. Visit your agency's human resources to request a FERS benefits statement showing estimates. Update annually as salary and tenure increase.

Social Security also offers guaranteed income, this time based on your highest 35 years of earnings. While a bit more complex to estimate, the Social Security Administration does provide benefits calculators and statements online reflecting your actual earnings record.

Coordinating the two lifetime income streams is crucial because FERS does impact Social Security. Two key integration rules can reduce Social Security benefits for some federal retirees depending on income. Understanding possible effects lets you better optimize decisions on taking benefits.

In total FERS aims to replace about 30% of pre-retirement income with Social Security targeted to replace 40%. Evaluating your estimated monthly sums from both sources gives you a picture of any gap needing additional savings. Review annually and adjust contributions targeting 80-100% income replacement in retirement.