FERS Pension Gone? Here’s What Really Happens If You Resign Tomorrow

This article was originally published here

Key Takeaways

If you resign from federal service under FERS, your pension isn’t automatically gone—but whether you can claim it, and when, depends on your age and years of service.
A deferred retirement is often available, but you must understand the timelines, penalties, and how benefits like FEHB and TSP access may be impacted.

Resigning Under FERS: What You Need to Know

If you’re covered by the Federal Employees Retirement System (FERS) and thinking about resigning before reaching retirement eligibility, you might wonder whether you’re walking away from your pension. The truth is, your benefits don’t disappear—but they do change dramatically based on how and when you leave federal service.

Eligibility Matters More Than You Think

Under FERS, your eligibility for retirement benefits is determined by your age and years of creditable service. If you resign before reaching the required combination of age and service for immediate retirement, you may still qualify for deferred retirement—but you must meet key thresholds:

Minimum of 5 years of creditable service to be eligible for any pension.
Deferred retirement is available starting at age 62 with at least 5 years of service.
With 10 years of service, you’re eligible at the Minimum Retirement Age (MRA), which in 2025 is between 56 and 57 depending on your birth year.

However, these options don’t come with full benefits.

Your Pension Isn’t Gone—But It’s Not Immediate Either

When you resign, you’re not entitled to an immediate annuity unless you meet retirement eligibility. That means:

No monthly FERS pension begins until you reach the required age.
The annuity is based on your high-3 average salary and years of service at the time you resigned—not when you claim it.
If you take a deferred retirement at MRA with 10+ years of service, there’s a 5% reduction per year if you claim before age 62.

You can delay your pension to age 62 to avoid this reduction, but that delay means no income from your FERS annuity during that gap.

You Must Apply for Deferred Retirement

Many resigning employees don’t realize this critical step: your pension is not automatic. If you’re not eligible for an immediate retirement, you must file Form RI 92-19 when you reach retirement age to begin receiving your deferred annuity.

Failure to file means you won’t receive anything—even if you’re entitled to it. There’s no automatic notice or check arriving on your birthday.

What Happens to FEHB and FEGLI

If you resign before reaching immediate retirement eligibility, you lose access to FEHB and FEGLI.

FEHB does not continue into retirement unless you retire with an immediate annuity.
Resigning employees cannot keep FEHB into retirement unless they later qualify under MRA+10 and meet the five-year rule.
FEGLI coverage ends unless you convert it to a private policy within 31 days.

Once you leave service, even with a future pension, you’ll need to obtain healthcare and life insurance through other means unless you’re eligible for and elect continuation.

What About the TSP?

The Thrift Savings Plan remains yours after resignation:

You can leave your money in the TSP and continue to benefit from its tax-advantaged growth.
You can roll it over into another qualified retirement plan.
Withdrawals are allowed after separation, but early withdrawals before age 59½ may be subject to a 10% IRS penalty.

However, you lose eligibility for federal matching contributions once you leave employment.

Creditable Service Still Counts

Even after resignation, your years of federal service remain creditable. If you later return to federal employment, those years count toward your new total. You may even be able to buy back military service or prior service not yet counted.

However, time spent after resignation and before deferred retirement does not count toward your pension. Your annuity will be calculated as if time stood still after you left.

Should You Withdraw Your FERS Contributions?

You do have the option to withdraw your FERS contributions (your own retirement deductions from your paychecks). But there’s a catch:

Doing so forfeits your right to a future FERS pension.
If you later re-enter federal service, you’ll have to redeposit those funds with interest to regain credit.

Only consider withdrawing if you’re absolutely certain you won’t return to government work and don’t want a future pension.

How Resignation Differs from Retirement

Here’s the key distinction:

Retirement means you’re eligible for and electing an annuity that begins shortly after you leave.
Resignation means you’re ending federal service before becoming eligible for an immediate annuity.

Retirees keep their health and life insurance and start receiving annuity payments. Resignees don’t—unless they later apply and qualify for deferred benefits.

Timeline to Expect Your Pension

If you resign in 2025 and are under age 62, you will wait years before you can apply for your pension:

Resign with 5+ years of service: eligible at 62.
Resign with 10+ years: eligible at your MRA (but reduced), or wait until 62 for full pension.
No benefits are paid until you file your application at that time.

This can lead to a long income gap that you’ll need to plan for using savings, your TSP, or other income sources.

Can You Get Social Security?

Yes, your Social Security benefits aren’t tied to your FERS employment directly, but they factor into your retirement:

Social Security can start as early as age 62, but claiming early reduces your benefit.
Your FERS pension and Social Security are independent—you don’t lose one for claiming the other.

Remember, you pay into Social Security while working under FERS, so it’s part of your retirement income picture, just not tied to your resignation decision.

Mistakes to Avoid When Resigning

Assuming you’re retiring when you’re actually resigning.
Forgetting to file for deferred retirement benefits.
Withdrawing FERS contributions without understanding the consequences.
Not planning for the income gap before your deferred annuity begins.

These are common missteps that cost employees thousands in missed pension and healthcare value.

Before You Walk Away

Before resigning from a FERS-covered position, ask yourself:

Do I have at least 5 years of service?
How far am I from age 62 or my MRA?
Can I bridge the income gap with other assets?
Will I need health insurance, and how will I get it?
Am I making a temporary decision that affects my permanent retirement?

If you’re unsure, speak with a licensed professional listed on this website before making any irreversible choices.

Make the Right Exit—And Protect Your Future

Resigning under FERS doesn’t mean forfeiting your retirement—but it can delay or reduce it significantly. Knowing how to claim a deferred retirement, what benefits you lose, and how to manage the gap in coverage and income is essential for making a smart decision.

Before you resign, review your service history, understand your eligibility, and plan your next steps. For personalized help evaluating your situation, speak with a licensed professional listed on this website.