What Are Some Facts About FERS Federal Retirement?

The Federal Employees Retirement System, or FERS, has three main parts: Social Security, the Basic Benefit Plan and the Thrift Savings Plan. While the Basic Benefit Plan requires participants to be vested employees of the federal government, the other two parts of FERS are transferable to other positions.

The Basic Benefit Plan is the FERS equivalent of a pension plan in the private sector. The government withholds a certain amount of every employee's pay each pay period and applies this sum toward the Basic Benefit Plan. Only vested employees have access to the Basic Benefit Plan annuity when they retire. Employees who are not vested can leave the accumulated money in their account if they plan to return or take a refund if they do not.

The Thrift Savings Plan automatically places an amount equivalent to 1 percent of an employee's pay into an untaxed account each pay period. The employer also matches any deposits an employee makes into the Thrift Savings Plan at the same rate.

Government-provided medical, dental and eye coverage for each active employee terminates 31 days after retirement. Medicare takes over these responsibilities for retirees of sufficient age. Federal life insurance also terminates after 31 days, but retirees can buy a replacement policy for coverage after retirement.