Melinda Chase
Brandon, Florida 33511
Melinda has a wealth of experience in financial services and family legacy planning, and she is dedicated to helping federal and postal employees retire comfortably with as much tax-free income as possible. The few years she spent in funeral planning shaped her outlook on the importance of looking at both the present and the future in order to create the ideal retirement lifestyle for her clients.
Melinda excels at guiding clients through the process of optimizing their federal benefits and pension annuities by creating a monthly income plan guaranteed for life that reflects their goals and wishes. She has a unique ability to make complex financial concepts easy to understand, and she is committed to helping her clients achieve their retirement goals.
Melinda’s financial career began 20 years ago at The Royal Bank of Scotland, where she helped small business owners save money on credit card processing fees. She later worked at a funeral home in Florida, where she learned the importance of pre-planning and having the right type of life insurance in place to protect loved ones during difficult times.
In 2011, she started helping federal and postal workers navigate and understand their federal benefits. She quickly began to see how much money is wasted by people who do not fully understand their benefit plans and retirement system, and she is passionate about helping those who are willing to listen and take control of their financial futures.
Creating a secure retirement plan with guaranteed lifetime income that adjusts for inflation is an important step towards a happy and stress-free retirement. It ensures that your financial needs will be met and allows you to enjoy the retirement lifestyle you want.
FERS Retirement System Guide
If you’re a federal employee or postal worker, the FERS retirement system serves as the cornerstone of your financial future. But are you fully equipped to understand how it works, what benefits you’re entitled to, and how to maximize them? Let’s break it down so you can confidently plan for retirement.
What Is the FERS Retirement System?
The Federal Employees Retirement System (FERS) is a comprehensive retirement plan designed specifically for federal employees and postal workers. Established in 1987, it replaced the older Civil Service Retirement System (CSRS) and provides a mix of benefits to support you in retirement.
FERS is composed of three key components:
- Basic Benefit Plan
This is a pension-like benefit calculated based on your years of service and your high-three average salary. Both you and your agency contribute to this plan. - Thrift Savings Plan (TSP)
Think of the TSP as the federal government’s version of a 401(k). It offers generous matching contributions, allowing you to grow your retirement savings effectively. - Social Security Benefits
As a FERS employee, you also contribute to Social Security, making you eligible for these benefits upon retirement.
By combining these three elements, the FERS retirement system offers a robust safety net for your golden years.
How Do FERS Benefits Work?
Understanding the components of your FERS retirement benefits is key to maximizing their value.
Basic Benefit Plan Formula
Your pension is calculated using the following formula:
- 1% of your high-three average salary x years of service = Annual pension
- 1.1% of your high-three average salary x years of service (if retiring at age 62 with 20+ years of service)
For instance, if your high-three average salary is $80,000 and you have 30 years of service, your annual pension would be:
- $24,000 (or $26,400 if retiring at age 62 with 20+ years of service).
Maximizing Your Thrift Savings Plan Contributions
The Thrift Savings Plan (TSP) provides unmatched benefits, including a 5% agency match. If you’re not contributing at least 5%, you’re missing out on free money!
For 2025, the contribution limit is $22,500, with an additional $7,500 for those over 50. Consider increasing your TSP contributions each year to fully capitalize on this opportunity.
Social Security Benefits
Your Social Security benefit is calculated based on your lifetime earnings. While this isn’t unique to FERS, combining it with your Basic Benefit Plan and TSP creates a solid financial foundation for retirement.
Types of Retirement Under FERS
Immediate Retirement
To qualify for immediate retirement, you must meet the following criteria:
- Minimum Retirement Age (MRA) with 30 years of service.
- Age 60 with 20 years of service.
- Age 62 with at least 5 years of service.
Your MRA is determined by your birth year and ranges from 55 to 57.
Disability Retirement
If you’re unable to perform your job duties due to a medical condition, you may qualify for disability retirement. This benefit ensures financial security for federal employees who experience long-term health challenges.
Early and Deferred Retirement
- Early Retirement: Available through programs like Voluntary Early Retirement Authority (VERA).
- Deferred Retirement: If you leave federal service before meeting retirement age, you can defer your pension until you become eligible.
Five Tips to Maximize Your FERS Retirement
- Start Early with TSP Contributions
Even small contributions early in your career can grow significantly over time. - Understand Your FEGLI Options
Regularly review your Federal Employees’ Group Life Insurance (FEGLI) coverage to ensure it aligns with your needs. - Plan for Healthcare Costs
Your Federal Employees Health Benefits (FEHB) can continue into retirement, but it’s wise to plan for potential out-of-pocket costs. - Buy Back Military Time
Federal employees with prior military service can “buy back” that time to increase their years of service under FERS, which significantly boosts retirement benefits. - Use Free Federal Retirement Resources
The Office of Personnel Management (OPM) offers tools like calculators and guides to help federal employees estimate their benefits.
Common Questions About FERS
Can I Withdraw Money from My TSP Early?
Yes, but early withdrawals before age 59 ½ may incur a penalty unless exceptions apply. Consider letting your funds grow unless absolutely necessary.
What Happens If I Leave Federal Service?
You can defer your pension or request a refund of contributions. Carefully weigh the long-term impact before deciding.
Is It Better to Retire Early or Work Longer?
This depends on your financial situation. Retiring later often results in a higher pension and more time to contribute to your TSP.
Why Planning for FERS Retirement Matters
The FERS retirement system is one of the most generous plans available, but it requires proactive planning. By understanding your benefits and making informed choices, you can create a secure and comfortable future for yourself and your family members.
Take the Next Step in Your Retirement Journey
Ready to plan your FERS retirement? The Benefit Coordinators are here to help. We specialize in guiding federal and postal employees through their benefits and retirement planning.