This week’s question comes from Sheryl; a Federal Employee who is due to retire in 5 years time. Tammy gives a comprehensive answer as to how sick and annual leave are handled when calculating one’s Federal Employee Retirement Benefits.
You can read the full article here:
If you have more questions about the effect federal leaves have on your retirement benefits, write to us in the comments and we will try to answer it in a future episode.
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Sick leave is a critical aspect of any federal employee’s benefits package, providing peace of mind and financial security in the event of illness or injury. However, many federal employees may not fully understand how sick leave can affect their retirement benefits. In this article, we will explore how sick leave can impact your federal employee retirement benefits.
One of the key ways that sick leave can affect your retirement benefits is through the Federal Employees Retirement System (FERS) and the Civil Service Retirement System (CSRS). Both of these retirement systems allow federal employees to receive credit for unused sick leave when calculating their retirement benefits.
Under FERS, federal employees can receive credit for unused sick leave when calculating their retirement benefits. Each hour of sick leave that is unused at the time of retirement is credited towards your retirement benefits. This means that the more sick leave you have accumulated throughout your federal career, the higher your retirement benefits will be.
For those under CSRS, the benefit is even more significant. CSRS allows federal employees to receive credit for unused sick leave at a certain rate, which can significantly increase your retirement benefits. In some cases, unused sick leave can even be converted into additional service credits, further boosting your retirement benefits.
In addition to increasing your retirement benefits, sick leave can also have an impact on the timing of your retirement. Many federal employees may choose to use up their sick leave before retiring in order to maximize their benefits. However, it is important to note that sick leave cannot be used to extend your length of service for retirement purposes.
It is also important to understand that sick leave is not the same as annual leave when it comes to retirement benefits. While unused annual leave is typically paid out in a lump sum upon retirement, unused sick leave is only credited towards your retirement benefits and cannot be cashed out.
In conclusion, sick leave can have a significant impact on your federal employee retirement benefits. By accumulating and preserving your sick leave throughout your federal career, you can increase your retirement benefits and potentially retire earlier. It is important to carefully consider how sick leave fits into your overall retirement planning and to consult with a retirement benefits specialist if you have any questions.
Does unused sick leave count towards your creditable service if you take MRA+10 and postpone your annuity?
Does your sick leave be added to your years of service at your current grade and step before retiring? For example if you got a step in the yar you retire and retire at 11 step 8. Would your sick year months be added at this grade?
I dont see any advantage to save either AL or SL. (Outside the lump sum as a bridge payment until benefits kick in). For AL, taxes will be taken out either way and with SL, you are getting compensated Pennies on the dollar.
People should use all of their leave before retirement !!! they will get the full salary pay and plus earn more leave !!! 12 hrs every pay period. Plus the kicker is your time of service will increase , which will mean a higher retirement monthly payment for lifetime !! One shouldn't work, work, work then retire and do nothing .. as its a big shock to your health…. One should start taking lots of leave a year or two before retirement to determine how your life will change in retirement… by having lots of free time. These are my thoughts …
How long does it normally take for DFAS to deposit the lump sump Leave Payout in the bank account? Thanks!
You only can carry 240 hours on the books. How can you retiring with 400 hours? Plus the pump pay out gets ate up by taxes. Take the leave before retirement.
When did this sick leave rule changed cause in Jan 1, 2014 the rule said that you could sell the hours and now I see this added time. I already retired and got paid 100% of my S/L but now ex coworkers are asking.
Ok
Does this apply for someone who will leave federal service with 20 years of federal service, prior to their retirement age? or is it only applicable for someone who is eligible to obtain annuity upon retirement?
The music is very distracting, makes this hard to watch
fantastic ecplanation. I'm on CSRS and my HR is pretty clueless. Do you cover CSRS also?
Thank you very much!
So if you reach your MRA and have 29 and a half years of service with 6 months of unused sick leave, you could retire under MRA plus 10 but not under optional retirement even though when the sick leave is added on you would have 30 years of service.
Great info. Does the sick leave calculation also apply to executive branch departments like the Tennessee Valley Authority?
Thank you Tammy, very clear and you helped me confirm that if I go out on 31 Dec 2022 I will only have 2 days hanging (37 years, 10 months and 2 days total service with SL). My HR won't estimate what my total time would be then and would only estimate based on my current SL (with 24 PPs left). If I didn't see this video I'd think I couldn't retire on 31 December as I would have had 28 days that would be lost. I appreciate the help!!!!!! IS there a chart or calculator for finding your FERS Creditable Service based on your RSCD?????
I'm 60 years old with over 30 years creditable federal service. My current thinking is to retire in Sept 2023; because my birthday is August 1st I will be 62. Now, according to the leave chart, I will have approximately four months worth of sick leave. I know from this video that it is added to my total credible time. My questions is this: could I select a earlier retirement date (say end of June 2023 – before my 62 birthday) within the three months of creditable sick leave to to get the 10% retirement bonus?
Hi Tammy I know this is such a late comment here but I have looking for somebody to assist me to calculate my sick leave and annual leave, will hit 20 yrs next year Sept 2023, got about 600 plus in my annual leave and about 480 hrs sick leave. What month of the year do you recommend I should retire? I will. By the way I will be 65 yrs old in June 2023. Thanls for any advice
What is the web site for sick leave computation tables charts?
Wow. I had no idea sick leave was able to be cashed-out! Thanks so much.
If I have 4 month and 17 days of sick leave; do the 17 days don’t get credited as service time? Only the number of months get credited?
First question: why is this video entitled "How Does Sick Leave Affect your Federal Employee Retirmement Benefits" when it is all about annual leave? Secondly: My agency does not permit an employee to care more than a 240 hr a/l balance past the end of the calendar year (unless there are special permissions). I think this is pretty universal for all federal employees. Not sure how the hypothetical employee ended up with 448 hrs a/l.
New Years Eve is not considered one of the 10 federal holidays for the United States Postal Service and its employees. We work on Saturdays so in 2021 Friday 12/31 is a workday and our holiday is on Saturday the 1st.