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Retirement Planning


Whether you are close to federal employee retirement or just starting out in your career, this is the place to share ideas with your federal colleagues on creating a secure financial foundation.


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Buzz  
#1 Posted : Tuesday, September 20, 2022 10:47:25 AM(UTC)
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Hello All,

I am wondering which pay scale to use to plan my retirement. From 2007-2014 I was an exempt GS-12-07 and now am a competitive GS-09-02. Is my High-Three calculated using the pay scale in use during 2011-2014 for GS-12 as well as the Sacramento COLA I received during those years or is my High-Three figured using my retirement date pay scale and COLA received at that moment in time I actually retire? Thank you for any help, Buzz
Navy Bubblehead  
#2 Posted : Tuesday, September 20, 2022 11:08:48 AM(UTC)
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"
Your “high-3” average pay is the highest average basic pay you earned during any 3 consecutive years of service. These three years are usually your final three years of service, but can be an earlier period, if your basic pay was higher during that period. Your basic pay is the basic salary you earn for your position"

From OPM website
Buzz  
#3 Posted : Wednesday, September 21, 2022 2:55:33 PM(UTC)
Buzz

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Thank you my friend, I do know that is a quote out of the OPM manual. My situation is different and that does not answer my questions. I am posting my questions again and hoping someone else has experienced my situation and has an answer. My local HR states they do not know! I am wondering which pay scale to use to plan my retirement. From 2007-2014 I was an exempt GS-12-07 and now am a competitive GS-09-02. Is my High-Three calculated using the pay scale in use during 2011-2014 for GS-12 as well as the Sacramento COLA I received during those years or is my High-Three figured using my retirement date pay scale and COLA received at that moment in time I actually retire? Reserve Military retirement pay is quite similar, however, the rate of pay is present day at highest rank and pay held upon retirement. So, a Lt Col with 26 years who retired in 2000 would have high three figured at 2022 pay scales at age 60, not 2000. Does the GS system work the same? Is COLA figured at location of retirement + high three or previous place of employment + high three? Thank you for any help, Buzz
roger.d  
#4 Posted : Thursday, September 22, 2022 7:15:27 AM(UTC)
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Originally Posted by: Buzz Go to Quoted Post
Thank you my friend, I do know that is a quote out of the OPM manual. My situation is different and that does not answer my questions. I am posting my questions again and hoping someone else has experienced my situation and has an answer. My local HR states they do not know! I am wondering which pay scale to use to plan my retirement. From 2007-2014 I was an exempt GS-12-07 and now am a competitive GS-09-02. Is my High-Three calculated using the pay scale in use during 2011-2014 for GS-12 as well as the Sacramento COLA I received during those years or is my High-Three figured using my retirement date pay scale and COLA received at that moment in time I actually retire? Reserve Military retirement pay is quite similar, however, the rate of pay is present day at highest rank and pay held upon retirement. So, a Lt Col with 26 years who retired in 2000 would have high three figured at 2022 pay scales at age 60, not 2000. Does the GS system work the same? Is COLA figured at location of retirement + high three or previous place of employment + high three? Thank you for any help, Buzz


As mentioned before, the pension is based on your "high three". It is possible that your current position, at a lower GS grade, is paying more than your previous position, at a higher grade. After all, you left that position in 2014, 8 years ago.

If you earnings from 2011-2014 are higher than your earnings at the end of your career, those numbers will be used.

From what I read, "locality pay" is included in the pension calculation. Is that what you are calling a COLA?

edit: if you are asking if your pension will be calculated in the year of your retirement, say 2024, based on what a GS-12-7 is earning in 2024, NO. It is calculated based upon what you actually earned. Not counting overtime pay.

Edited by user Thursday, September 22, 2022 7:17:56 AM(UTC)  | Reason: Not specified

Socialist governments traditionally do make a financial mess. They always run out of other people’s money. --Margaret Thatcher
GWPDA  
#5 Posted : Thursday, September 22, 2022 7:29:04 AM(UTC)
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'Your “high-3” average pay is the highest average basic pay you earned during any 3 consecutive years of service.'

Each of these words has a specific meaning, including "basic", "average", "earned", "3", "consecutive" and "years". It doesn't matter what pay scale you were on - it matters how much "basic pay you earned" in any "3 consecutive years of service" which results in the "highest average". A "COLA" is not part of "basic pay you earned" and is not added into the calculation. Military retirement pay and civilian retirement pay systems are not the same.

"Is COLA figured at location of retirement + high three or previous place of employment + high three? " COLA's paid during a work career in, for example Hawai'i or Alaska are not part of basic pay and are not the same thing as a COLA which may be added as a pension adjustment.
Buzz  
#6 Posted : Thursday, September 22, 2022 7:34:33 AM(UTC)
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Thank you so much! Buzz
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