Qualifying for a Disability Retirement Under the FERS
Should you have to leave your federal job early, would you be eligible?
You may anticipate working for the federal government until you retire. One question is worth considering, however: what if you have to leave your federal job because of a health issue before you reach retirement age? Is a disability retirement then in order rather than a voluntary one?
In such an event, a consultation with your agency’s human resources specialist should be your first move. That HR officer can help you see if you can qualify for a disability retirement under the Federal Employees Retirement System (FERS). (There are also disability benefits available through the older Civil Service Retirement System, the predecessor of FERS.)1
Under what conditions could you qualify for a disability retirement? Well, several tests need to be met. One, the disability must be expected to last for a year or more. Two, you must be credited with at least 18 months of service under the FERS (this is better than the CERS requirement, which is five years). Three, your disability or illness must have emerged while you were working in a job or capacity subject to FERS, and that disability or illness must be serious enough to prevent you from providing what is deemed “useful and efficient” service (translation: you cannot perform your job well enough to meet expectations).1 Four, the federal agency that employs you has to prove that it cannot accommodate your medical condition in your job; it also must demonstrate that it has considered you for any vacant position you are qualified for in the same commuting area that would provide you with equivalent grade or salary. Five, you need to apply for a disability retirement before your separation from service or within a year of that date, unless you lack the mental capacity to meet this deadline (a guardian may do this upon your behalf). Also, if you are working in a job subject to FERS, you must file a claim for Social Security disability benefits; if that claim is withdrawn, you are not eligible for a disability retirement under FERS.1 Disability retirees are not entitled to the Special Retirement Supplement (SRS), the fixed income payment that retired federal workers can receive prior to age 62.2
If you feel you could potentially qualify for a disability retirement, explore the option – and talk with the financial professional you know and trust to see how this economic transition will affect your overall retirement plan.