“When can I retire with no penalties?”  We receive this question many times each week.

First, let’s look at when you earn a full retirement:

• MRA with 30 years of service.

• Age 60 with 20 years of service.

• Age 62 with 5 years of service.

Have you noticed, I did not say anything about MRA plus 10? That is because, MRA+10 will not provide the same benefits, so caution, warning and other red lights are flashing.

• If you are MRA + 10 years of service, you may retire with a reduced annuity, due to penalty, however, if you can defer or postpone your annuity until age 62, you may then receive your full retirement. If you qualify for an early retirement, your annuity (pension) options are two:

1. Immediate annuity.

 2. Postponed or Deferred Annuity

(Postponed allows a re-join FEHB and Deferring does not, this is for another time)

If you take an immediate annuity, your retirement will be reduced by 5% for each year you are under age 62 (if 4 years = 20% reduction). If you wait until age 62 to receive your annuity, there is no reduction

If you are offered a VERA, the penalties are waived if you are at least age 50 with 20 years or more of service.

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