There’s some bad news for federal prison workers – retention payments will be greatly reduced or removed entirely by March 23.
These retention payments were put in place because staff were dropping due to poor working conditions and low pay. Now, with the payments taken away, the outlook is even more concerning.
This is a major loss for all federal prison workers, but it’s especially difficult for people already struggling with work because of a mental or physical health challenge. Some employees have already considered leaving the federal government for a job that would pay more and be less stressful.
We understand the appeal, but before you walk away, there’s a way to keep your federal benefits and get that job in the private sector.
How to make the most out of retirement
If you’ve been under FERS for at least 18 months, and you have a medical condition that stops you from doing at least one function of your job, you may be a good candidate for an early retirement option called Federal Disability Retirement.
This benefit isn’t for total disability – just for folks who are having trouble performing all of their duties.
Check out our user-friendly guide for qualifying conditions if you want to know more.
If approved, you’d get:
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- A monthly paycheck
- The ability to get another job in the private sector earning up to 80% of your previous salary
- More years added to your federal pension
- Continued health and life insurance coverage
Let’s look at a few examples to show how this benefit could help someone who’s struggling.
Example 1
Jane is a line cook for the Federal Bureau of Prisons, and she’s worked there for 19 years. Recently, her PTSD and anxiety have gotten worse, and the stressful environment of work triggers frequent panic attacks. Her medical provider has said Jane shouldn’t respond to emergency calls at work. Responding to all emergencies is an essential function of her position, and she isn’t able to do it. She’d be a great candidate for Disability Retirement.
After approval, Jane got a job as a librarian where she received 80% of her previous salary. When Jane got approved for Disability Retirement, the combination of her annuity checks, and her librarian salary helped her earn more money than she did before.
Let’s break that down:
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- Year 1: Jane gets a new job in the private sector making 80% of her previous salary. She also receives monthly disability retirement checks that are 60% of the average of her highest 3 years working at the federal government. Conclusion: Her first year on the benefit, Jane will make 140% of her previous salary.
- Year 2 and following: Jane continues to make 80% of her previous salary and she gets retirement checks that are 40% of her high three average salary. Conclusion: Jane makes 120% of her previous salary with Disability Retirement.
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That means that every year on the benefit, Jane will be making more money than she did before being approved for Disability Retirement, and she’ll be able to avoid the stressful environment that triggered her symptoms.
Example 2
Luis is a prison guard for the Federal Bureau of Prisons, and he’s been under FERS for 6 years. Three years ago, Luis injured his knee, and despite surgeries, physical therapy, and medications, he continues to have pain and mobility issues. Because of these issues, Luis hasn’t been able to pass the physical fitness test. This is a good case for Disability Retirement.
Once approved, Luis started his own business where he earned 60% of what he made at his agency.
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- Year 1: Luis makes 60% percent of his previous salary through his business, and 60% of his previous salary through his monthly annuity checks. Conclusion: Luis is making 120% of his previous salary.
- Year 2 and following: Luis continues making 60% of his previous salary and he makes 40% of his previous salary through his monthly annuity checks. Conclusion: Luis makes 100% of his previous salary.
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For the first year, Luis will make more than his previous salary. Then every year after that, he’ll make the same amount as his previous salary. He’ll have the same benefits and the same pay, but none of the pain of having to strain his knee more.
If you’d like to learn more about how much you can make while on Disability Retirement, check out our webinar or use our handy calculator to find out what your monthly annuity could be.
Takeaways
It’s possible to get a job in the private sector that will allow you to work with your medical needs and continue growing your federal pension until you hit 62.
On top of that, you won’t lose your health and life insurance coverage, so you can keep getting the care you need to really thrive.
If you want to know if Disability Retirement is right for you, check out our step-by-step guide and give our office a call today to set up a free 1-on-1 consultation where we can hear about your story and help you learn how to build a brighter future.
