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June 21, 2018

Public Sector Retirement News

Federal Employee Retirement and Benefits News

Tag: LEO


Special Category Employees and Retirement Benefit Differences

Federal Retirement benefits are not always the same for every employee. If you are considered a Special Category employee, there are some distinguishable rules that you should be aware of. The categories that fall in this domain include the firefighters, law enforcement officers, and the air traffic controllers.

Retirement benefits differ for Special Category employees:

The firefighters and the law enforcing officers can retire if they are 50 years old or more. Of course, another condition in this regard would be the completion of 20 years of service. The retirement age that is mandatory for everyone is 57, and it’s only when an agency’s head thinks that it’s wise to continue can the age go up to around 60.

The main reason behind the difference in the retirement benefits is the fact that the careers of these Special Category employees last much shorter than the average employees. For example, the CSRS annuity can be calculated by taking 2.5 percent of the high-3 average pay and multiplying the answer with the 20 years of service. Follow the process by taking 2 percent of the high-3 times if there remain any years of service unaccounted for.

To calculate the FERS annuity, you will have to consider 1.7 percent of the high-3 average pay and whatever answer comes needs to be multiplied by 20 years of service. Similarly, take 1 percent of any of the remaining years of service.

The careers of the special category employees are filled with meeting and tackling situations that normal employees would never have to face, so it’s only natural for them to expect a little more compensation when it comes to getting Retirement benefits. There are other worth mentioning differences too, and they all contribute towards the effort to make the post-retirement lives of special category employees easy and comfortable.

Police Retirement Accounts Underfunded in Davenport County, Iowa

The police retirement accounts remained underfunded in the Davenport County, Iowa for a few months due to an error. The problem has been rectified after the union members asked it to be fixed. Compensation has also been made to all the officials who were impacted. There is no impact on the budget.


The Mistake regarding Retirement Accounts

On July 1, 2015, the employer contribution to all the union members’ retirement health savings plan was to be increased from 2 percent to 3 percent of individual income but it remained 2 percent only for 29 pay periods which made the Davenport Police Department’s union members a  little light in the retirement wallet. The increase was to happen due to the current police union contract.

But due to a mistake made by the city’s payroll department, the increase did not happen on time. An officer discovered this mistake and reported it to the concerned department.

The Error

As per the statement of Brandon Wright, the Finance Director the error occurred because the payroll system of the city was not adjusted at the beginning of the year.  As a result, it did not reflect any change. It was corrected soon after the error was pointed out.

The Compensation

Dawn Sherman who serves as the Human Resources Director stated that as the contract was negotiated in good faith, the difference was offered as compensation from the city but the union demanded to get an interest too.

Wright stated that the city agreed to it and made a contribution for the interest too. It used the annualized rate for NASDAQ and Dow Jones to calculate the interest. The total amount of the interest was $5,234.96 which is about $32 per person.

No Impact

Even though the $120,000 in missing contributions went unnoticed last year, they will have no impact on the last year’s budget. Wright said that there was no impact on the budget because the amount was rightly budgeted.

Not a Big Deal

Sgt. Eric Turner did not think much of the city’s mistake of keeping the police retirement accounts underfunded because the problem was resolved quickly and satisfactorily. He stated that someone misread the contract but it has been taken care of. He added that it was a small mistake that was corrected immediately. It seems that he is downplaying the error which has impacted the life of numerous police officials of the county.

The Mayfield Police Department is Hiring Retired Police Officers

The Mayfield Police Department has recently announced that it planned to start hiring retired police officers who have more than 20 years of on the job experience. The mayor seemed to be delighted by the idea. Even the local people are happy with the decision.

Image Credits

The New Act that allows for Hiring Retired Police Officers

The law that paves the way for hiring retired police officers was passed by Senate during the 2016 legislative session. It’s entitled Senate Bill 206 and it is a vital part of the Kentucky’s retirement reform. This law allows the retired police officers to get a salary while working in a full-time job. The veterans don’t even have to let go of their retirement benefits for taking up the job after retirement.

The Move of The Mayfield Police Department

The Mayfield Police Department has started hiring retired police officers who have been on the job at least 20 or more than 20 years. They are looking to hire at least 6 retired officers right now. The department has allowed the officers to keep getting their retirement benefits even when they are hired for the job. The department, however, will not be providing any extra retirement or health benefits when it offers re-employment.

The Happiness

Teresa Rochetti-Cantrell who serves as the Mayfield Mayor recently stated that the legislation is a genius idea for small towns such as Mayfield as they constantly struggle to retain a full force of police officers. The Mayfield Police Department is also a kind of stepping stone to larger departments, she added.

The Costs of Training New Officers

The mayor also revealed that the cost of training new police officers in Mayfield comes down to about $8,000 to $12,000.

Experience Matters

Major Shannon Keller, who is already serving the Mayfield Police Department, opines that hiring a retired police officer gives another set of eyes. He thinks that 20 years of experience is more than enough as veterans have seen a lot during that time and they can contribute a lot.

Views of the Residents

Joseph Tune, a local Mayfield resident also seemed delighted with the announcement of hiring retired police officers. He said that this decision makes him more comfortable in the community. He also feels that hiring veterans is a good step as it helps officers to get someone who they can look up to. The bill will be implemented in Mid-July of 2016.

About 30,000 Federal Employees to get better Retirement Benefits

The federal employees who fall under the designation of police series GS-0083 may soon have the ability to retire early and get better retirement benefits. A new bill has been proposed by the Democrats on the same.  This move has been appreciated by many federal unions.

The Bill Impacting Federal Employees’ Retirement BenefitsRetirement Benefits

The bill entitled The Law Enforcement Officers Equity Act was introduced by Senators Barbara Mikulski, D-Md and Cory Booker, D-N.J. It states that all federal employees who have the authority to carry a firearm and who investigate criminals or apprehend them should be given better retirement benefits. It includes all the employees designated in the police series GS-0083 such as Internal Revenue Service officers who are in charge of collecting delinquent taxes, Veterans Affairs Department police officers and U.S. Postal Service Inspection Service employees.

The Retirement Age

If the bill is passed, some of the employees working at the FBI, Defense Department and many such agencies would get the right to retire at age 50 if they have completed 20 years of service. They would also be able to retire at any age after they have completed 25 years on the job. Law enforcement officers get a more generous annuity when they retire and they contribute more from paychecks towards their retirement. Booker said that he wanted to fix that loophole so that all law enforcement officers get the benefits they deserve.

No More Punishments

Mikulski stated that the bill would right the wrong that has been happening with people who defend the nation against terrorists and stop the smuggling of illegal drugs.

The Credit

If the bill is passed, the employees would be able to get credit for the time they have served. They would just need to send a notice to the OPM within 5 years time from the date the bill is enacted or before they have to retire.

The Praise

Many of the federal employees’ union groups praised the bill suggested by the democrats’ senators. The groups stated that the officers deal with the same problems faced by the federal law enforcement so they really deserve the same perks. The President of National Treasury Employees Union, Tony Reardon wrote a letter to Booker and stated that IRS officers deal with critical situations such as assaults, threats, and even gunfire so they must be given the retirement benefits they deserve.

Federal Government Shells Out $18 Million to Destroy Marijuana

The federal government has spent a lot of money on eradicating illegal marijuana in the last year. The eradication efforts even went on in the states that have legalized marijuana for adults. Several lawmakers are asking the government to use the eradication funds towards more productive programs such as domestic violence but there have been no positive developments in this regard.

The Money Spent by the Federal Government

The federal government has spent about $18 million in the cannabis eradication program in the year 2015. The Drug Enforcement Administration’s controversial program details were shared by the administration. It also said that federal, state and local authorities evacuated about 4.1 million cultivated marijuana plants that were present in all 50 states.

In 2014, the number of plants was 4.3 million. The money spent by the federal government in 2014 was about the same. The cost of destroying a plant comes down to $4.42 in 2015 while it was $4.20 in 2014.

The Program

The program allows local and state law enforcement agencies to search, seize, and destroy illegal marijuana plants in the USA. A large amount of money to fund this program is offered from the asset forfeiture fund of the Justice Department. The program money is also used to employ helicopters to scour the countryside areas for the production of marijuana.

The Better Use of Funds

Rep. Ted Lieu, D-Calif. Along with a small group of lawmakers had tried to pass a legislation that aims to redirect the funds involved in marijuana eradication into more productive uses like the domestic violence prevention programs. They were unsuccessful in their efforts and their leader still thinks that marijuana must be removed from Schedule I classification and DEA must not allow the wasteful eradication program to go on for long.

States that have Legalized Marijuana

The eradication operation was also conducted in the states such as Oregon and Washington that have now legalized marijuana use for the recreational purpose by the adults. In Washington only, about 36,000 plants were done away with and the cost of it came ou to about $950,000. It means that the DEA spent about $26 per plant.

States Not Accepting Federal Government Help

There are states like Colorado and Alaska that refused to use the federal government funds to do away with the illegal marijuana plants. They stuck to removing the illegal marijuana plants on their own.

Can I Qualify For Special LEO Pay and Not LEO Retirement?

LEO RetirementIs it possible to qualify for LEO pay and NOT LEO Retirement?  The answer to the question unfortunately is YES.  Because of a number of factors all Law Enforcement Officers (LEOs) are not equal.  Persons doing the same kind of work are entitled to similar compensation in pay.  Therefore, individuals working in law enforcement may qualify for the special category pay, but do not meet the same standard for retirement provisions in terms of how their federal annuity is calculated.  Because of the mandatory retirement age and more being paid into the pension plan the calculation is decidedly different from calculating an annuity for regular employees.

LEO Statutory Requirements

Individuals in law enforcement who do not meet the statutory requirements as outlined under OPM guidelines do not benefit from the special calculation for retirement, but use the same annuity calculation as regular employees.   Is it a question of fairness or statute?  The Federal Government is such an incredibly large entity that as times advanced and more jobs and classifications were created, some things might have gotten left out.  The system for the most part has worked well, not perfectly, but well.

LEO & Fair Pay

The fact that recruitment continues to be stagnated for Law Enforcement Officers due to the inherent high risk and the question of pay.  I really do think there are some professions that are absolutely a no-brainer when it comes to how they should be compensated.  First, teachers should be some of the best paid people in the workforce because they teach all of us.  Whether you are Einstein, Obama, O’Keefe, Ginsburg, or just Robert and Alice Claret next door, you sat in some teacher’s classroom.  That is a venue the majority of us pass through.

The people who put their lives on the line to protect the rest of us should be well-paid for their sacrifice.  Military personnel, Law Enforcement, Firefighters, Linemen, Miners are just a few of the people who should be paid well.  Why include Linemen and Miners?  Do you want to be in a cherry-picker dealing with electricity?  Do you want to be way down under the ground digging for coal – an energy source?  Well somebody has to do it and they should be paid well for the sacrifices made.  Everybody wants the glamorous jobs, but what about the risky jobs.  I am grateful for those brave men and women who teach, who mine, who keep my electricity on, who watch out for fires and those who work hard to keep us safe from danger and harm.

P. S.  Always Remember to Share What You Know.

Law Enforcement and Veteran Benefits

LEO FERS Supplement

LEO Mandatory Retirement Age

Is There an Asset Ceiling for the VA Benefit? by Tom Rutter

Will Spending Be The Same In Retirement?

Federal Retirement Spending Habits

Federal Retirement Spending Habits

For Federal Employees, spending will change in retirement.  Some federal retirees will spend more and some will spend less based on their individual financial situation.  It is useful to note that expenses today may not be expenses tomorrow.  Therefore, some projections and forecasting is needed when looking at spending in retirement.

Expenses like transportation and food costs may go down.  If you don’t choose to work or even if you work part-time, you will probably not spend as much money in transportation as you did before.  Your budget for clothing may also decrease.  Entertainment and social activities may go up or down.  Because you are retired, your social calendar may not be as busy.  But, on the other hand, because you are retired, your social calendar might be completely filled because you do have more free time.

Medical Expenses and Life Insurance in Retirement

Let’s take a look at medical expenses in retirement.  Those expenses will probably go up because it seems to follow that as we get older, we require more medical attention.   Conversely, taxes will probably go down because you will no longer have payroll taxes for Social Security and Medicare if you don’t have earned income after retirement.   For instance, someone earning $60,000 in 2009 might have paid $4,590 for Social Security and Medicare Taxes, but will pay zero dollars in retirement if there is no earned income.  The tax savings could also help to replace some of the salary we will need to cover in retirement.  Savings should be aggressive prior to retirement. Your cost for life insurance, FEGLI or private compay life insurance, may also decrease – you should compare your FEGLI coverage and costs again private life insurance to make sure you are getting the best deal.

There are many ways in which our expenses and income may fluctuate in our retirement years.  But knowing what we know, it is prudent to aggressively save prior to retirement and even more prudent to aggressively pay down debt prior to retirement.  Carrying heavy debt into retirement is a disaster waiting to happen.  Reducing your debt lowers interest and increases your net worth.  If you have a very high debt: income ratio you will have to spend a lot of money just paying interest.

I know you are still thinking about your vision for retirement.  What about insinuating “some magic dust” into your vision —- living debt free before you reach retirement?  Imagine how much bigger and fantastic your vision could be if you had no heavy debt to carry around with you.  A rule of thumb is to lay out your entire debt ranking the order in which they should be paid.  You pay off debt with the highest interest first and then you put off the debt with the lowest interest last until you have paid everything off.

You don’t want to pay off your mortgage unless you have a lot of disposal income because you may need the tax advantages from the mortgage payment.  If I had enough money to pay off my mortgage, I would do a very careful analysis of the pros and cons before taking the next step of paying off the mortgage.  Paying off a mortgage might be the right thing to do for some and not for others.  Each person’s financial circumstances is uniquely different.  Try living by this “mantra” – What I cannot pay for in cash, I cannot afford, mortgages aside.  You will be amazed how living by this mantra will curtail spending. Decision-making strategies must always be utilized when spending your money.  Sometimes credit gives us too much flight to fantasy.  We all need credit, but how we handle it will be key to our retirement success.

Remember when it was assumed when one retired the mortgage would also be retired.  That is not always the case now-a-day.   Having to make large debt payments out of a limited retirement income can easily sour one’s financial picture in retirement.  Every effort must be made to leave debt behind as you move into retirement.  Having a vision and dreams for retirement has associated costs.  If you pay down your debt then you will have money that is not obligated for expenses to spend the way you want.  It is called your vision and dream cache. The more savvy you are at managing your finances, the better that cache will look and feel.  Most retirees talk about being able to travel.  That is an expense that is outside of the normal day-to-day expenses especially if the travel is extensive.  So we have to be very careful in planning our trip and making sure we are comparison shopping.

P. S. Always Remember to Share What You Know.


Thrift Savings Plan (TSP) Withdrawal Options

For Postal Employees – LiteBlue and the TSP

Federal and Postal Employees – Choosing a Financial Professional

The Thrift Savings Plan (TSP)

Is All ‘Your’ TSP Money Actually Yours?

Federal Retirement Benefit Analysis

How To Best Fund Your TSP

Retiring In Less Than One Year

Retiring In Less Than One Year

Consider the following if your retirement plans are less than one year away.

  • Is there any way that I could be indebted to my employer?
  1. If you have outstanding travel advances.
  2. Overpayment of salary that has not been resolved.
  3. Indebtedness for failure to return government property or for damage to government property.
  4. Advanced leave.

When and how do I waive my military retired pay?

If you would like to waive your military retired pay to receive credit for military service in the computation of your benefit, you can write to the Retired Pay Operations Center at least 60 days before your planned retirement.  Send your waiver to:

Defense Finance and Accounting Service

U.S. Military Retirement Pay

P.O. Box 7130

London, KY  40742-7130 or you can “fax” your request to (888) 469-6559

What Is The Maximum Federal Retirement Benefit I Can Receive?

The basic civil service retirement annuity cannot exceed 80% of your high-3 average salary, excluding your unused sick leave.  The 80% limitation is typically reached when you have 41 years and 11 months of service, not including accumulated sick leave. 

Law Enforcement Officer (LEOs) Retirement Annuities

Law Enforcement Officers (LEOs) may under special computation provisions receive the 80% limit with fewer years of service.

Service beyond the years which provides the maximum benefit will not be used to compute your Law Enforment Officer annuity.  The retirement contributions you made during those years will be automatically refunded to you with interest at the rate of three percent per year, compounded annually.  You have the option of using the refund to purchase additional annuities as if the contributions and interest are voluntary contributions.

However, if you have federal civilian employment periods when you did not contribute to either  or FERS, excess contributions are automatically applied toward any deposit due for those employment periods.

How do I find out if I am eligible for Medicare coverage?

It is recommended that you contact the Social Security Administration at least three months before you reach your 65th birthday to apply for Medicare Benefits.  The Social Security Administration will have the records pertaining to your eligibility for Medicare coverage.  If there is a problem locating your records either you or your employer can obtain a statement of your earnings by writing to:

General Services Administration

National Personnel Records Center

Civilian Personnel Records

111 Winnebago Street

St. Louis, Missouri 63118

Your request should include:

  1. Your name as shown on your payroll records;
  2. Your date of birth;
  3. Your Social Security Number;
  4. Your complete mailing address;
  5. The years for which earnings are needed;
  6. The name and location of employer for each year;
  7. State clearly the reason for the request;
  8. Affix your written signature; and,
  9. Write a statement declaring that all other sources of information have been exhausted.
  • When should I choose my exact retirement date?

If you have not already done so, start thinking about choosing your exact retirement date.  Your benefit can be estimated based on the exact date you choose.  Remember OPM cannot give you the best estimate until you have actually applied for retirement.

  • When should I complete my application?

You should carefully read all of the information in the application package and submit the forms.  You do not need to submit a resignation letter.  Your completed and signed application is equivalent to a resignation.  However, if you are eligible for benefits, you should not resign with the intent of retiring at some later date.  If you were to expire after separation but before filing your retirement application no life insurance, no survivor benefit and no survivor health insurance coverage would be available to your survivors.  All other exit procedures required by the agency should be followed and completed.

  • Should I check on my military service deposit?

Your human capital office will verify with your payroll office that the deposit to give you credit in your annuity for military service you performed after 1956 has been paid, or that arrangements have been made for complete payment before you leave the agency’s rolls.

  • Should I sign up now to receive my retirement payments by direct deposit?

If your retirement records are electronically transmitted by your employer via the Data Exchange Gateway (DEG), the account information for direct deposit will be sent automatically.  If this is not the case, then you must submit with your retirement package, a request to receive payments by direct deposit.  A letter can be submitted or SF 1199A with the application.  SF 1199A can be obtained from your financial institution.

Direct deposit is generally not available to persons with a permanent address outside of the United States, except for Canada.  Persons with permanent addresses outside the United States may request direct deposit to a financial institution in the United States.

P. S. Always Remember to Share What You Know.


Thrift Savings Plan (TSP) Withdrawal Options

For Postal Employees – LiteBlue and the TSP

Federal and Postal Employees – Choosing a Financial Professional

The Thrift Savings Plan (TSP)

Is All ‘Your’ TSP Money Actually Yours?

Federal Retirement Benefit Analysis

How To Best Fund Your TSP


LEO Equity For All – Men and Women in Uniform

LEO Equity

leoOften when we think of men and women in uniform, our minds drift to our brave men and women who serve in the military.  The highest honor should go to them.  However, we have another cadre of brave men and women in uniform and they are law enforcement officers (LEO) and firefighters.

Because of the nature and danger involved in the work these civilians perform, their retirement provisions are unique.  They are able to retire at an earlier age than most, long before they first become eligible to receive Social Security benefits at age 62.  These fine men and women are able to retire at age 50 with 20 years of service and at any age with 25 years of service and at times have mandatory retirement ages that must be adhered to.  However, age 59 1/2 carries some significance in terms of making withdrawals from their TSP.  You may begin withdrawing from qualified retirement plans at age 59 1/2 if retired or from an IRA without incurring the 10 percent penalty.

Congress recognized in 2006 that 50 year old  state and local public safety officials should be allowed to withdraw from their retirement accounts without suffering a 10% penalty because they had not reached age 59 1/2.   If they could retire early due to the uniqueness of their jobs, then they should be able to reap the benefits thereof.  The passing of that legislation in 2006 unfortunately did not extend to federal LEOs and Firefighters.

Congressmen Bill Pascrell (D-NJ) and Dave Reichert (R-WA) have introduced legislation that would give federal law enforcement officers and firefighters the same withdrawal privileges and access to their retirement accounts as local and state safety officials without suffering a penalty.  This legislation just makes good sense and we commend these Congresmen for putting this very important issue forward.  Law Enforcement Officials and Firefighters are united in their selfless commitment to protect the citizens of this nation and we as citizens support measures to give back to them for putting their lives on the line each and every day.

Many citizens become disenchanted with the slow movement of Congress sometimes and many think they just aren’t doing enough for the average citizen.  However, the legislation introduced by Congressmen Reichert and Pascrell renews our confidence in the men and women we elect to make laws that serve the best interest of our citizens.  Congressmen thank you for thinking of those who protect us all.

P. S.  Always Remember to Share What You Know

Million Dollar LEO (Law Enforcement Officer) Question

Million Dollar LEO Question

leoWe have dedicated our entire segment to a discussion of law enforcement officers (LEO) and LEO retirement.  Many questions surrounding the retirement system for LEOs come from LEOs as well as non-LEOs.  The topic is termed million dollar LEO question because many law enforcement personnel continue to grapple with understanding why some individuals working in law enforcement are classified as qualified LEOs while others are not.

Let me preface my statement by saying that law enforcement is critically important in maintaining law and order and preventing a state of anarchy.  The answer to the million dollar question rests in the definition given to LEOs for retirement purposes.

There is a commonly accepted concept of law enforcement and there is a restrictive concept of law enforcement that frames how an individual is termed as a qualified LEO.  The fundamental concept that deems an individual a qualified LEO is that the primary duties must involve investigation, apprehension, or detention of individuals suspected or convicted of offenses against the criminal laws of the United States.

The distinction is drawn that other non-LEOs involved in law enforcement are more involved in prevention or detection of violations versus investigating those violations.  Police officers, guards, customs and immigration inspectors and other inspectors do not meet the definition of LEO for retirement purposes.  This definition or exclusion in no way speaks to the unimportance of these personnel, as a matter of fact it is just the opposite.

Qualified LEOs work with many different classifications of law enforcement personnel to perform the very critical duties of protecting the nation from harm and danger.

The argument for integrating LEOs into one retirement system is the difference in basic and premium pay entitlements from one law enforcement group to another.

It is also important to point out that there is a definition of law enforcement officer under CSRS LEOs and FERS LEOs.  The definitions are essentially parallel.  However, CSRS LEOs for retirement purposes include FBI special agents, Secret Service special agents, Border Patrol agents, U. S. marshals, deputy U. S. marshals, and Bureau of Prisons correctional officers.  FERS LEOs include all of the groups in CSRS in addition to Secret Service Uniformed Division officers, Park Police officers and individuals fundamentally engaged in the protection of officials of the U.S. Government against threats to their personal safety.

The groups that are not included in either group (CSRS or FERS) include certain police officers, guards and U.S. Customs and Border officers.

Hopefully this information sheds some light on our Million dollar LEO question.

Related LEO Articles

What Is LEO Retirement

LEO Mandatory Retirement Age

Explanation of FERS Component for LEOs

LEO (Law Enforcement Officer) FERS Supplement

LEO Annuity Component Computations

Federal Law Enforcement (LEO) – Cost of Living Adjustments

Million Dollar LEO Question

Law Enforcement Officers (LEO) – Who Qualifies May Surprise You

 LEO Qualifiers

leoIn our posts highlighting Law Enforcement, we have talked a lot about QUALIFIED Law Enforcement Officers (LEO).  What does that mean?  Individuals are deemed qualified law enforcement officers (LEOs) as a result of, but not limited to, their government employment status and are authorized to engage in direct crime prevention, conduct investigations, detect illegal activity, prosecute or confine individuals violating the law.

Law Enforcement Officers are in most cases authorized by their agencies to carry a firearm and must also carry on their person photo identification issued by the employing government agency.  But what happens to the privilege and responsibility of carrying a firearm once the LEO retires?

President Obama signed into law October, 2010, the-Law Enforcement Officers Safety Improvement Act amending the National Concealed Carry Law.  The provisions under both Safety Improvement Act and the Concealed Carry Law identify two classes of individuals: qualified law enforcement officers and qualified retired law enforcement officers.

The Act allows these qualified individuals to carry concealed weapons while off duty in any jurisdiction in the United States, including across states lines irrespective of state and local laws that make differ from the Act.  The exception to this broad provision is that private citizens have the right to forbid concealed weapons on their property.  States also have the right to forbid concealed weapons on its property.

To meet the standard for a qualified retired law enforcement officer, individuals must have separated from their employing agency in good standing whose duties and responsibilities were clearly outlined and encompassed the full range of duties as defined by what constitutes a law enforcement officer.  The individuals must have met within the most recent 12-month period firearm certification requirements from their employing agency and have also met the standards set by the State in which he/she resides. The individuals must also carry photo identification issued from the separating issue of which they were employed attesting to their status as a law enforcement officer (retired) with authorization to possess and carry a concealed firearm.  Fitness analysis of LEOs must not indicate any mental or emotional impairment.

Retirement planning is a signifcant item on the -To-Do-List.  Understanding the parameters in which LEOs can operate once in retirement is a very important aspect of the law to understand.  The Act is detailed, many of the amendments may require some extra review and evaluation.  There will also be many questions left in the minds of LEOs facing retirement and those already in retirement.  I am a strong advocate of educating and sharing information with as many people as I can.  My mantra has always been – Knowledge unshared is knowledge lost.

Utilize your human resources office often during your tenure as a federal employee, engage with LEO organizations, individuals and colleagues to discuss and share information and concerns.  If you are pondering as to how you are going to fill your time schedule when you retire, think about how much knowledge you have as a Law Enforcement Officer. You are a valued member of our nation. You might want to attach teacher, instructor, professor or consultant to your profile.

P. S.  Always Remember to Share What You Know.

Related LEO Articles

What Is LEO Retirement

LEO Mandatory Retirement Age

Explanation of FERS Component for LEOs

LEO (Law Enforcement Officer) FERS Supplement

LEO Annuity Component Computations

Federal Law Enforcement (LEO) – Cost of Living Adjustments

Million Dollar LEO Question

Law Enforcement Officer: Explanation of FERS Components for LEOs

Law Enforcement Officer FERS Explanation

law enforcement officerWe have focused on the Law Enforcement Officer, but let’s take a brief moment to explain the 3 legs of the Federal Employees Retirement System (FERS).  This post was prompted by an email question from a FERS employee.

The question:  I would like a simple and clear explanation of the FERS retirement system.  Can you help?

The answer is – we are going to give it our best shot.  If more clarity is needed after the publication of this post, just tell us and we will use a different approach to get you to where you want to be.

The Federal Employees Retirement System (FERS) is made up of 3 parts:  A Basic Benefit, the Thrift Savings Plan (TSP) and Social Security.

The FERS Basic Benefit is a defined benefit plan determined by two factors; the average high-3 annual earnings of an employee that represent the highest earnings during 36 consecutive months of federal service that would produce the highest average.  In most cases, the highest average salary comes towards the end of the work career.  However, that is not always the case.

The second factor in the FERS Basic Benefit is the employee’s length of creditable service.  The calculation for the FERS Basic Benefit is different for LEOs than for regular FERS employees.  An explanation of the formula can be viewed in previous posts on LEOs (LEO-FERS Basic Annuity and LEO Component Computation).

The next component of the 3 leg stool representing FERS retirement is Social Security.  Earning 40 credits, approximately 4 per year over a 10 year period with a minimum age of 62 qualifies individuals for the Social Security benefit.

The last leg of the stool and potentially the largest component is the Thrift Savings Plan (TSP).  The TSP is structured to build financial stability in retirement.  TSP is portable and allows participants a wide-range of passive investment options.  The agency contributes 1% of salary automatically whether the employee makes a contribution or not.  The contributions become vested after 3 years of employment.  Your TSP balance is yours to keep when you leave service.

Additionally the government will contribute from 1% to 5% in matching funds based on your level of contributions.  The maximum TSP cap changes annually based on the rate of inflation.  If inflation is flat, then there will be no change in the cap.  It is important that employees maximize their contributions to the TSP in order to realize the greatest benefit from FERS retirement.  Instead of only drawing a pension, FERS employees have the combination of a Basic Benefit, Social Security and TSP contributions.

Make certain that you speak with the TSP representative in your Human Resources Office to ensure your contributions are spread out over the 26 pay periods in order to receive maximum contributions from the government.  If you max out contributions too quickly, you miss out on the government match.  FERS is structured to provide employees with a retirement profile that will help them retire well.

P. S.  Always Remember to Share What You Know.

To check your TSP balance check here

Which TSP Funds should you choose?

Related LEO Articles

What Is LEO Retirement

LEO Mandatory Retirement Age

Explanation of FERS Component for LEOs

LEO (Law Enforcement Officer) FERS Supplement

LEO Annuity Component Computations

Federal Law Enforcement (LEO) – Cost of Living Adjustments

Million Dollar LEO Question

LEO (Law Enforcement Officer) FERS Supplement

Law Enforcement Officer FERS Supplement

law enforcement officer

Law Enforcement Officers (LEOs) who retire before reaching age 62, the age of first eligibility for Social Security benefits, are qualified for what is commonly called a FERS supplement.  It is better explained as a gap filler.  Through the FERS Supplement, LEOs essentially receive what they would get from Social Security if they had reached the age of Social Security eligibility.

LEOs are eligible to receive the FERS Supplement until reaching the age of 62.  The FERS Supplement is generally less than  the actual Social Security benefit payment, it is an approximation of the benefit.  For LEOs, the FERS Supplement is adjusted annually to reflect the change in the consumer price index (CPI), the same as regular Social Security benefits.

The earnings limitation due to the supplement are not applicable until Social Security eligibility is reached.  Retired persons who receive Social Security benefits and are not LEOs may be subject to the earnings limitation if they have not reached full retirement age.

Earnings are reduced by $1 for every $2 earned and by $2 for every $3 earned.  Individuals born between approximately 1945 and 1971 will reach full retirement age at 66.  At that time there is no limitation on the amount of money that can be earned.  I know you cannot wait to turn 66.

P. S.  Always Remember to Share What You Know.

For more information on FERS eligibility click HERE

Do you know your Best Day To Retire?

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LEO (Law Enforcement Officer) Mandatory Retirement Age

Law Enforcement Officer Mandatory Retirement Age

law enforcement officerLaw Enforcement Officers (LEOs) have a mandatory retirement age and must retire from their covered positions at age 57.  If the LEO does not have 20 years of service he/she may continue to work until the last day of the month in which the 20 years is reached.  However, the absolute, mandatory retirement age is 60 whether the 20 years have been reached or not.

Further, in order to work until age 60 in a covered position, permission must be granted by the agency head.  LEOs contribute 7.5% of pay to the federal retirement fund as opposed to the 7.0% required under regular FERS guidelines.

The extra contribution of .5% allows for the early mandatory retirement of LEOs with full retirement benefits.  LEOs are also eligible to continue their life and FEHB (health insurance) into retirement as long as they have been enrolled 5 years prior to retirement and are eligible to retire on an immediate annuity.

Let’s reiterate the fact that mandatory retirement age is for covered positions under LEO guidelines.  LEOs must retire from their classification as Law Enforcement Officers at age 57.  The mandatory retirement provision does not preclude these employees from seeking employment outside of their LEO classification.

P.S.  Always Remember to Share What You Know.

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LEO Retirement: What is it?

What is LEO Retirement?

leo retirementWhen it comes to has ‘earned’ their LEO retirement Federal Law Enforcement Officers (LEOs) are at the top of the list.  I believe it is more than fair to say that law enforcement is hazardous duty.  LEO retirement, therefore, is an reward for navigating hazards that are much more dangerous than your typical 9-5 job.  Law enforcement because of the nature of the work also requires physical vigor normally associated with adults between the ages of 21 years of age and those who have not yet reached age 37 upon employment in law enforcement.

Since LEOs must meet some rather stringent requirements for employment, they are also entitled to retire early as a normal part of the provisions of the LEO retirement guidelines.  LEO retirement; at age 50 with 20 years of service LEOs can retire with full benefits.  They can retire at any age with 25 years of service..  Only 20 of those years must be in a covered position.  In summary as long as an LEO has 20 years of covered service, he/she only needs to work an additional 5 years in any federal position to retire with a full, unreduced annuity.

For calculation purposes, all years worked will be covered under special LEO retirement provisions.  Individuals in law enforcement who do not qualify as LEOs for retirement purposes, will have their annuity benefits calculated under regular FERS guidelines.

The concern for individuals working in law enforcement who do not qualify as LEOs is that they do not reap the same retirement benefits as qualifying LEOs who have the advantage of a more generous calculation profile.

P. S.  Always Remember to Share What You Know.

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Federal Law Enforcement (LEO) – Cost of Living Adjustments

LEO: Cost of Living Adjustments (COLAs)

leoThe federal LEO workforce is well acquainted with COLAs during their work careers.  As we present information in a comprehensive-friendly environment, it is our goal in providing that information to assist in paving the way for federal and postal employees to retire well.

COLAs extend into retirement.  Retirees’ annuities are increased for cost-of-living adjustments if they meet certain criteria: (1) You retired on disability, except if you receive a disability annuity based on 60 percent of the high-3 average salary.  This normally happens during the initial year of receiving disability benefits. (2) You are over 62 years of age. (3) You retired under special provisions for Law Enforcement Officers.* (4) A portion of your retirement is calculated under the Civil Service Retirement System (CSRS).

If you are a FERS retiree and are under age 62 and don’t meet the above criteria, you are not eligible for a COLA until you reach the age of 62.

*Provisions also cover Air Traffic Controllers and Firefighters.

P. S.  Always Remember to Share What You Know.

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LEO – Annuity Component Computations

leoWe are continuing our discussion on the annuity computation focused specifically on LEO (Law Enforcement Officers).  We never want to present too much information at once as it is our objective to provide as much clarity as humanly possible. Federal Retirement Systems for LEOs can be complex so assisting the federal workforce in planning for retirement is easier by the inch than the mile.

Many employees in the Federal Government transferred to the Federal Employees Retirement System (FERS) and may be part of a system comprised of two components – FERS and CSRS.

One of the provisions at the time of transfer required at a minimum of 5 years of creditable civilian service covered by CSRS and Social Security.  With that caveat,the formula represents 1 percent of the high-3 average salary for each year of service for employees under age 62 upon retirement or age 62 with fewer than 20 years of service.

The percentage rises to 1.1 percent of the high-3 average salary for every year of service for individuals at age 62 or older at separation with 20 plus years of service-representing the calculation of the Federal Employees Retirement System (FERS) component.

Conversely, for LEOs, the Civil Service Retirement Service (CSRS) component employs what I describe as a graduated calculation.  During the first 5 years of CSRS the percentage is 1.5 of the high-3 average for every year of service.  1.75% of the high-3 average salary for each year of service for the second 5 years.  For all years of service over 10 years, the percentage rises to 2% of the high -3 average salary for each year of service.

Under this scenario, Law Enforcement Officers’ computation is 2.5% of time of CSRS including the years and months of service up to 20 years multiplied by the high-3 average salary added to 2% of the same beyond 20 years of service.

The explanation of computation of LEO FERS annuity benefits underscores the need to take a very serious look at integrating the retirement system to address any and all categories of individuals involved in law enforcement.

P. S.  Always Remember to Share What You Know.

Related LEO Articles

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LEO: Law Enforcement Officer FERS Basic Annuity

LEO and FERS Basic Annuity

leoLaw Enforcement Officers (LEOs) fall under special retirement provisions which make them eligible for an Annuity during their retirement.  Although there are other categories of employees who also fall under these Annuity provisions (i.e. Firefighters, Air Traffic Controllers, and Nuclear Materials Couriers) LEO requirements also have some unique provisions that may require LEOs to approach their unique retirement benefits from a different angle.

The FERS basic annuity formula (which is the annuity formula used by LEOs today) is generally calculated as follows:  If you are eligible under FERS and also under age 62 when you retire or 62 years of age or older with less than a 20 year tenure, 1 percent of your high-3 average salary for each year of service is calculated. At age 62 or older with 20 plus years of service, then the formula is 1.1 percent of the high-3 average salary based on each year of service.

Law Enforcement Officers covered under FERS will use the formula of 1.7 percent of their high-3 average salary multiplied by the years of service that do not exceeed 20.  In addition, 1 percent of the high-3 average salary is again multiplied by all years of service beyond 20 years.

In summary the FERS LEO annuity formula employs a two-step procedure.  Service up to 20 years is calculated at 1.7 percent of the high-3 average salary.  Any years worked beyond 20 years is calculated at 1 percent of the high-3 average salary.  The calculations are added together or combined to arrive at the FERS LEO Basic Annuity.

There is more to discuss relevant to non-disability retirement annuity formulas and calculations.  We will stop here and discuss the other facets of the calculations in an upcoming post.

P. S. Always Remember to Share What You Know.

LEO Retirement System: Why Not Integrated?

Why Not an Integrated LEO Retirement System?

leoWhy wouldn’t an integrated LEO retirement system exist?  The changing dynamics in our nation and around the globe call for not only duty mission changes, but changes in the way human resources standards and procedures are applied, including retirement.  The federal classification system entails position duties and summaries of those duties for perhaps any occupation one can think of.

I used to play a ‘what is most important’ game with myself as an HR Executive – what is the most important aspect of Human Resources-Human Capital Management, what is defined by what employees value most?  Initially, I voted for making certain payroll was always uninterrupted.  People want their paychecks.  But as times and circumstances have matured, I find that the paycheck is still a top draw, but a check after retirement is equally as important.  So a paycheck is a paycheck is a paycheck.

Human Resources personnel have a duty to make retirement systems as easy to understand as possible so that recipients of those systems will understand most emphatically how to optimize the benefits of those sytems.  Individuals in Law Enforcement have been particularly impacted by provisions that are not necessarily clear and easy to navigate.  This is where an integrated LEO retirement system would make such a positive impact.

In a previous post we attempted to list occupations covered or identifed as Law Enforcement Occupations for the purpose of retirement and those not-covered.  By definition in brevity, law enforcement officers have the authority to make arrests, detain and apprehend persons suspected of or involved in criminal activity.  Yet, there are other law enforcement officers who perform these same or very similar duties who are not classified as LEOs, or qualify as Federal Law Enforcement Officers.

Therefore, the LEO retirement systems appear bifurcated at best which gives way to a question of ‘equity and parity in pay’.  The occupation of Law Enforcement requires individuals that are physically vigorous and under the age of 37 upon entry into the profession.  With mandatory retirement provisions, many LEOs leave service as very young people with so much worklife left.

A question that always comes up in LEO retirement training classes is; Must we leave the federal service upon mandatory retirement age?  One provision HR personnel typically do not make crystal clear is that LEOs must leave their classification (except under special circumstances), but do not necessarily have to leave the federal service.

It is my experience that a great number of LEOs feel they must leave the Federal Government upon reaching full retirement age.  These highly-trained personnel have much to contribute to their nation in a countless number of ways.  Individuals who serve our country by promulgating law and order often put their lives at risk, even more reason for personnel officials and human resource policy makers to ensure a retirement system that is clear, transparent, easily understood with no ambuiguity as to do I qualify or not for provisions within a certain classification of employees.

As a past Federal Human Capital Leader, I am a strong advocate of consistent and regular communication between HR and the people we serve throughout the federal service.   There is no greater tool than open, proactive communication and information dissemination in establishing a seamless framework of effective operations designed to serve customers from stem to stern.  An integrated LEO retirement system would be a good place to start.

P. S. Always Remember to Share What You Know.

LEO: Covered and Non-Covered Law Enforcement Officers

Covered and Non-Covered LEO

leoWe are featuring topics this segment of the posts on Law Enforcement Occupations and specifically what employees are covered by the special retirement benefits afforded to Law Enforcement Officers (LEO).  We attempt to be as comprehensive and clear in presenting information to federal and postal employees and the general public as possible.

In the previous post, we itemized some of the covered law enforcement occupations that typically qualify under the Civil Service Retirement System (CSRS) and the Federal Employees Retirement System (FERS).

Some additional occupations that qualify as covered for retirement purposes in the Law Enforcement Occupations are: Law Enforcement Park Rangers, TSA Federal Air Marshals, U.S. Marshals, Secret Service Uniformed Division Officers covered under FERS, and the Office of the Inspector General investigators in a number of federal agencies.

There are also some non-covered Law Enforcement Officer Occupations that do not ordinarily qualify for LEO Retirement benefits for the purpose of retirement under FERS and CSRS. The list includes, but is not necessarily limited to:  Veteran Affairs Police, IRS Revenue Officers, Police in the United States Mint, Department of Defense Police, Government Printing Office Police, Drug Enforcement Agency Diversion Investigators, Department of Homeland Security Federal Protective Service, Secret Service Special Officers, Assistant U. S. Attorneys, Police at the Bureau of Engraving and Printing and guards at other Government installations.

It is always important to understand as much about your retirement benefits as possible and this is especially important when it comes to Law Enforcement Officers.  If you are an LEO you should find out as soon as possible how you are classified and what federal retirement system you are eligible under.  This post is merely to expand the list of covered and non-covered occupations in law enforcement.  But as a precaution, take some time out of your busy schedule to visit your Human Resources Office or the Human Resources designee to have a chat about your status as an LEO and the impact on your retirement.

It can be frustrating to find out that something is not what you thought it was early, but it can be absolutely near unmanageable if you find out at the very end of your career that there is a problem.  Most of the problems can be fixed, but starting early to get your house in order is the best way to settle down into a comfortable and safe retirement.

P. S. Always Remember to Share What You Know.