If you are a federal civilian employee hired in 1984 or later, your retirement rests on three structurally different income streams: a defined-benefit pension (FERS), a defined-contribution savings plan with employer match (TSP), and Social Security. Each has its own formula, its own contribution mechanics, its own claiming-age tradeoffs, and its own legal authority. Most federal employees can quote one of the three accurately and only roughly understand the other two.

The cost of misunderstanding is measured in tens of thousands of dollars over a retired lifetime — leaving the TSP match on the table for a decade is a six-figure mistake; claiming Social Security at 62 instead of full retirement age can be too. This lesson covers the formulas, the deadlines, and the citations. The FERS basic annuity is a defined-benefit pension.

The formula is fixed by statute and implemented in regulation: the annual annuity equals your High-3 multiplied by your Years of Service, multiplied by an age-and-service-dependent multiplier (either 1.0 percent or 1.1 percent).