The federal government operates two primary retirement systems for its civilian employees. Understanding which system applies to you — and how it works — is fundamental knowledge for every federal worker.
CSRS: The Civil Service Retirement System
The Civil Service Retirement System (CSRS) is the older of the two programs, covering employees who entered federal service before January 1, 1984. Under CSRS, employees do not participate in Social Security for their federal employment.
Key features of CSRS include:
- Higher employee contribution rates (typically 7% of pay)
- A pension calculated using a formula based on years of service and highest average salary
- No Social Security component for federal service years
- Separate voluntary savings through the Thrift Savings Plan
FERS: The Federal Employees Retirement System
Most current federal employees fall under FERS, which was established in 1987. FERS is a three-component system designed to provide retirement income from multiple sources.
The three components of FERS are:
- Basic Benefit Plan — A defined benefit pension based on years of service and average salary
- Social Security — Federal employees under FERS contribute to and receive Social Security benefits
- Thrift Savings Plan (TSP) — A tax-advantaged savings plan similar to a private-sector 401(k), including employer matching contributions
Which System Am I In?
If you entered federal civilian service on or after January 1, 1984, you are almost certainly covered under FERS. Employees who were in service before that date may be under CSRS or may have elected to transfer to FERS during conversion periods.
Your most recent Statement of Earnings and Leave (pay stub) or your agency's HR office can confirm which system covers you.
Planning Ahead
Regardless of which system you're in, understanding the basic structure of your retirement benefits is an important first step in long-term planning. The Office of Personnel Management (OPM) publishes detailed information about both systems on its website.
For more educational resources for federal employees, visit our Information page.
This article is for general informational purposes only and does not constitute financial or retirement planning advice.