Defense Department Plans a Phased Retirement for Civilian Employees

Retirement concerns are growing across the nation. Many are anxious that their meager retirement funds won’t be enough to cover the costs of living after they stop working. Retirement is a scary topic for much of the working class. There’s widespread fear that the government is taking personal retirement funds to do things like pay down national debt and get themselves out of war crises.

Things are difficult in the retirement sector for employees everywhere, but the government isn’t completely deaf to cries for help. There are many proposals in the works to reduce the current retirement issues, and the Department of Defense (DoD) is joining the ranks. They’re rolling out a new phased retirement plan as a way to help civilian workers survive on meager retirement funds, as well as improve the quality of the DoD workforce.

Retirement Goes Part Time

retirement for civilians
Photo: American Advisors Group

This new retirement plan was created to solve a growing need for both employees within the DoD and retirement funds for retired employees. It will function as a phased retirement system, which means that employees can partially retire and access their retirement funds while working part-time to help manage the workforce needs. Specifically, it means feds can work 20 hours per week while also accessing half of their retirement annuity.

The program, which is entirely voluntary, is meant to be mutually beneficial for both parties. Upon retiring, many employees feel they lack purpose, but aren’t up to working full-time anymore. This phased plan gives retired employees something to do and a way to pay their bills following retirement.

Additionally, the bill was created to benefit government work sectors. It requires that phased employees spend at least 20 percent of their work time mentoring employees, which will help the DoD gain more knowledgeable and experienced employees.

Civilian Employees Seem Content with the Plan

According to reports, the phased retirement plan as a whole seems like a great deal. Employees are excited for the opportunity, and government sectors are expecting great results.

Richard Thissen, President of the National Active and Retired Federal Employees Association, can’t seem to give the program enough praise. “NARFE’s phones have rung off the hook with calls from federal employees wondering when phased retirement will be available at their agencies,” he said.

Who’s Eligible?

Part of the plan mandates that each department has the right to set up their own eligibility requirements. This includes when employees can apply and how quickly they can access the program.

According to the DoD memo from Peter Levine, Under Secretary of Defense for Personnel and Readiness, “Retirement-eligible employees must have been employed on a full-time basis for at least a consecutive three-year period ending on the effective date of entry into phased retirement status.”

Additionally, the memo pointed out that space may be limited for phased retirees. “Participation in the Phased Retirement Program is voluntary and requires the mutual consent of both the employee and an authorized DoD component official,” the memo said. “DoD components may limit the number of employees included in the Phased Retirement Program, as appropriate.”

Phased Retirement Will Grow

This is one of the first phased retirement plans that has come about following Congress’ phased retirement plan law that rolled out four years ago. As of the middle of January, less than 50 percent of government employees had applied for the phased retirement benefit. There’s hope that this move will encourage more people to jump on board.

The DoD’s new plan is expected to significantly raise the demand for this retirement diagram. “For many, many other federal employees,” says Thissen, “this news will add to their frustration because the future of phased retirement at many agencies is still uncertain.” Thissen has identified a growing need for such schemas across all sectors of government. With this kind of demand, it won’t be long before other sectors take up the plan.

Though many employees haven’t taken advantage of this arrangement because they don’t have finalized plans for retirement, the government agency predicts that the primary reason employees haven’t applied is a lack of education. Federal employees aren’t always sure of their options, even though this is one of the best plans available for government employees.

Nevertheless, many government agencies are already seeking integration of this mutually beneficial strategy. The Energy and Housing Department as well, as the Urban Development Department, have both implemented this plan already, and the Commerce Department has already reported they plan to implement phased retirement, due to the overwhelming demand.

Melissa Thompson
Melissa Thompson writes about a wide range of topics, revealing interesting things we didn't know before. She is a freelance USA Today producer, and a Technorati contributor.