How Many Retirees Are Under CSRS?

how many retirees are under csrs? About half of retired federal workers and their surviving dependents receive benefits from the Civil Service Retirement System (CSRS). In fiscal year 2022, 50.8% of employee annuitants received CSRS benefits, and 80.1% of surviving dependents received CSRS benefits. And the latest data available from the Office of Personnel Management — the number of active employees under CSRS was 44,000.

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The CSRS was replaced by the Federal Employees Retirement System (FERS) for federal employees who entered covered service on or after January 1, 1987. The CSRS provided a lifetime annuity to civil servants based on their age, average salary, and years of service. It was considered a more generous retirement system than FERS in some ways, such as providing cost-of-living adjustments to all retirees, even if they retired young.

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The Office of Personnel Management (OPM) also oversees the risk reserve account for the Federal Flexible Spending Account Program. These trust funds rank among the largest managed by the U.S. government.

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In December, the Congressional Research Service (CRS) provided a summary of recent trends in the Federal Employees Retirement System. Below are some key figures from the FY2022 CRS report:

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Retirement Coverage:

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1. FERS: 98.4% of current civilian federal employees (2,788,000)

2. CSRS: 1.6% of current civilian federal employees (44,000)

3. Total Annuitants: 2,226,760 employee annuitants and 475,562 survivor annuitants.

4. Distribution: 56% CSRS, 44% FERS.

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Geographic Distribution:

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• Top 5 States: California, Florida, Texas, Maryland, Virginia
• Lowest 5 States: Vermont, Wyoming, North Dakota, Rhode Island, Alaska
• International: 35,283 annuitants (1.3%)‍
• Average Age at Retirement: 62.3 years (CSRS: 65.6, FERS: 61.9)‍
• Average Years of Service: 26.1 years (CSRS: 39.2, FERS: 23.6)

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Retirement Trends:

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Annual Retirements: 114,505 (CSRS: 11,119, FERS: 103,386)

Average Monthly Annuity:

• FERS: $2,126
• CSRS: $5,447
• Civil Service Trust Fund: Increased from $238 billion in 1990 to $1.1 trillion in 2022 (372% increase)

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Age Demographics of Current Federal Employees:

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• CSRS: 91% are age 60 or older.
• FERS: 32% are age 55 or older, 15% are age 60 or older, and 42.1% are younger than 45.

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Public Perception of Retirement:

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The 2024 Retirement Confidence Survey found that American workers and retirees have mixed feelings about their retirement security. Key findings include:

• A decline in retirement confidence among workers and retirees.
• Concerns about rising healthcare costs and inflation.
• A need for increased retirement savings and financial planning.

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Employee Contributions:

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• Standard CSRS: Employees contribute 7% of their net pay to the pension system.
• CSRS-Offset: Employees contribute 0.8% of their net pay.
• Historical: Some CSRS workers used to contribute higher percentages (7.5% or 8%).

Pension Ceiling:

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• The maximum pension benefit is capped at 80% of the employee's high-three salary.
• This limit is typically reached after 41 years and 11 months of service.

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Voluntary Contribution Plan (VCP):

• After reaching the pension ceiling, excess contributions can be deposited into the VCP.
• The VCP allows employees to continue contributing to their retirement savings.
• The funds in the VCP can be used to purchase additional annuity or withdrawn as a lump sum.

Important Considerations:

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• The VCP is a valuable tool for employees who want to maximize their retirement benefits.
• It's important to understand the rules and regulations of the VCP before making any decisions.
• Consulting with a financial advisor can help you make informed decisions about your retirement savings.

Voluntary Contribution Plan (VCP)

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The Voluntary Contribution Plan (VCP) is a great way to supercharge your CSRS retirement savings. It lets you contribute extra money beyond the regular deduction, up to 10% of your total career earnings. While you'll pay taxes upfront, the earnings on your contributions can grow tax-deferred.

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When you retire, you have flexibility in how you use your VCP funds. You can either take a lump sum payment or use it to buy an additional annuity. If you choose a lump sum, keep in mind that the earnings portion will be subject to taxes. However, you can strategically transfer these funds to a traditional IRA or 401(k) to defer taxes until you withdraw the money.

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Understanding WEP and GPO: How They Might Affect Your Social Security Benefits

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If you're a CSRS retiree, you might be familiar with the terms WEP (Windfall Elimination Provision) and GPO (Government Pension Offset). These are two rules that can reduce your Social Security benefits.

Here's a breakdown of how they work:

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1. WEP: Because CSRS employees don't pay Social Security taxes, their Social Security benefits can be reduced if they also earned income from a job that did pay into Social Security.

2. GPO: If you or your spouse receives a government pension (like a CSRS pension), it can reduce your Social Security spousal or survivor benefits.

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Why Does This Happen?

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As a federal employee or retiree, you’ve worked hard to serve others—now it’s time to focus on your future. Let us help you achieve the financial freedom and peace of mind you deserve.

As a federal employee or retiree, you’ve worked hard to serve others—now it’s time to focus on your future. Let us help you achieve the financial freedom and peace of mind you deserve.

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These rules are designed to prevent people from receiving "double-dipping" benefits from both Social Security and government pensions.

What Can You Do?

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It's important to understand how these rules might affect your specific situation. Consider consulting with a Social Security expert or a financial advisor. They can provide personalized advice and help you navigate the complexities of these rules.

While there have been efforts to eliminate WEP and GPO, they remain in effect for now.

What is the Average CSRS Pension Amount?

Federal employee retirement income, particularly under the Civil Service Retirement System (CSRS) and the Federal Employees' Retirement System (FERS), can vary significantly based on factors like years of service, salary history, and chosen retirement options.

Key Factors Influencing Retirement Income:

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• Years of Service: The longer you serve, the higher your potential retirement benefits.
• Salary History: Your highest-earning years, known as your "high-three average," significantly impact your annuity.

Retirement System:

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• CSRS: Offers traditional defined-benefit pensions, often resulting in higher monthly payments.
• FERS: Combines a defined-benefit pension with a defined-contribution plan (similar to a 401(k)), providing a mix of guaranteed income and personal savings.
• Age at Retirement: Retiring early or late can affect the amount of your annuity.
• Spousal Benefits: If you're married, your spouse may be eligible for survivor benefits.

While average monthly annuities for CSRS and FERS retirees in FY2022 were $5,447 and $2,126, respectively, individual circumstances can lead to significantly higher or lower amounts.

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Is CSRS a Lifetime Annuity?

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Yes, a CSRS pension is a lifetime annuity. 1 This means that once you retire and start receiving your CSRS pension, you'll continue to receive monthly payments for the rest of your life. 2

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Can You Collect CSRS and Social Security?

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Unlike most employer-sponsored pensions in the private sector, CSRS annuities were not intended to supplement Social Security benefits. Yet, most Federal workers who earn a CSRS annuity also receive Social Security benefits at some time.

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How Many Ppostal Retirees Are There?

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USPS employs over half a million career employees and provides them with benefits upon retirement. With over 700,000 retirees currently relying on its pensions, safeguarding the Postal Service's retirement funds is critical to both the agency's finances and operations.

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