Military Time Buy Back
From: www.fedsmith.com/2019/08/27/buy-back-military-time/
https://www.fedsmith.com/2019/08/27/buy-back-military-time
If you have military time (not retired), you should consider buying back that time into the FERS system. It will provide a major boost for you.
The author has put this aviso on his page, so I will NOT reproduce the article. Please use the link above to read it.
© 2019 Neal Thompson. All rights reserved. This article may not be reproduced without express written consent from Neal Thompson.
https://www.fedsmith.com/2019/08/27/buy-back-military-time
If you have military time (not retired), you should consider buying back that time into the FERS system. It will provide a major boost for you.
The author has put this aviso on his page, so I will NOT reproduce the article. Please use the link above to read it.
© 2019 Neal Thompson. All rights reserved. This article may not be reproduced without express written consent from Neal Thompson.
HonorFirst Military Buyback Overview
The Military Buyback Program allows federal employees to purchase their military service time to increase their retirement annuity. This program is particularly beneficial for those who have served in the military and are now working in a federal civilian position.
The process involves paying a deposit into the Federal Employees Retirement System (FERS) or the Civil Service Retirement System (CSRS), which is then used to calculate your retirement benefits. The deposit amount is typically a percentage of your military base pay, plus interest. For FERS employees, the deposit equals 3% of military base pay, while for CSRS employees, it's 7%.
One of the key benefits of participating in the Military Buyback Program is the potential increase in your retirement annuity. For instance, if you served for 4 years in the military and bought back that time, instead of receiving an annuity calculated at 5% of your average high three salary after working 5 years, it would increase to 9% of your high three average salary.
As an example, let's say a federal employee served 4 years in the military and then worked in a federal civilian position for 30 years. If they didn't buy back their military time, they would retire with 30 years of service. However, if they chose to buy back their military time, they would retire with 34 years of service. This additional time could significantly increase their retirement annuity.
It's important to note that buying back military time doesn't affect other military benefits such as medical benefits, base access, commissary, or VA benefits, including any disability payments from the VA. It only affects (active duty) retired military pay; you cannot receive 2 separate retirements (military and civilian) for the exact same period of service.
However, the decision to buy back military time should be made after careful consideration and consultation with a financial advisor or retirement counselor, as it may not be beneficial for everyone.
The process involves paying a deposit into the Federal Employees Retirement System (FERS) or the Civil Service Retirement System (CSRS), which is then used to calculate your retirement benefits. The deposit amount is typically a percentage of your military base pay, plus interest. For FERS employees, the deposit equals 3% of military base pay, while for CSRS employees, it's 7%.
One of the key benefits of participating in the Military Buyback Program is the potential increase in your retirement annuity. For instance, if you served for 4 years in the military and bought back that time, instead of receiving an annuity calculated at 5% of your average high three salary after working 5 years, it would increase to 9% of your high three average salary.
As an example, let's say a federal employee served 4 years in the military and then worked in a federal civilian position for 30 years. If they didn't buy back their military time, they would retire with 30 years of service. However, if they chose to buy back their military time, they would retire with 34 years of service. This additional time could significantly increase their retirement annuity.
It's important to note that buying back military time doesn't affect other military benefits such as medical benefits, base access, commissary, or VA benefits, including any disability payments from the VA. It only affects (active duty) retired military pay; you cannot receive 2 separate retirements (military and civilian) for the exact same period of service.
However, the decision to buy back military time should be made after careful consideration and consultation with a financial advisor or retirement counselor, as it may not be beneficial for everyone.
