I was shocked.
Recently, a reader asked me whether it was worth it to take a federal position when they were 54. My all know that you get the best government pension with 30 years of service… but was there any benefit at all to starting government work later in life? (Especially if you have to take a pay cut for the federal job?)
When I did the math, I was completely surprised that after just working for the government for a few years, this woman would earn hundreds of thousands of dollars in retirement benefits as a federal retiree?
Sound good? Let’s take a look answer the question does the federal government hire older workers (almost certainly) and what kind of retirement benefits you could earn by doing a stint with a federal agency after retiring from a private sector job.Get Gov Worker’s top 4 tips for federal employees!
Table of Contents
- Does the federal government hire older workers?
- Does the government have an age limit or mandatory retirement age?
- Benefits of taking a federal job after age 50
- Example annuity calculation for someone starting in their 50’s
- Frequently Asked Questions
Please do not confuse my personal blog for financial advice, tax advice or an official position of the U.S. Government. This post may contain affiliate links. If you make a purchase after clicking on a link, I get a small percentage of the sale at no additional cost to you.
Does the federal government hire older workers?
Let’s start with the basics. The government is prohibited from discriminating against a job applicant because of his or her
- sex (including gender identity, sexual orientation, and pregnancy)
- national origin
- age (40 or older)
- genetic information
Age discrimination is one of the Prohibited Personnel Practices as defined in 5 USC § 2302.
We all know that there can be discrimination and/or hiring biases even when there are laws against it. However, during my career, I’ve often seen people 55 and older get selected in federal hiring processes. It’s definitely possible to get hired by the government when you’re in your in your 50’s and 60’s. In fact, older applicants even have a secret advantage when it comes to applying for federal jobs: years and years of specialized experience.
How the federal hiring process favors older workers
While it seems counterintuitive, older employees actually have advantages over new grads when applying for a federal job. As I explained in my post about disadvantages of working for the federal government, most government jobs require an advanced degree unless you can demonstrate at least one year of qualifying experience.
Therefore, while many recent grads have difficulty qualifying for a federal job, there are actually more job opportunities for older potential federal employees with a rich job history and lots of experience.
Does the government have an age limit or mandatory retirement age?
Now that we’ve covered how older people may qualify for federal employment, it’s important to discuss mandatory retirement. If your entry age and the age at which you were involuntarily forced to retire were close, it probably wouldn’t make sense to take a federal job. Luckily, most federal jobs do not have a maximum age for employment.
The exceptions to this rule are “special category” jobs, like air traffic control and law enforcement employees. These employees contribute more towards their pensions but are also forced to retire before age 57.
For most federal workers, there is no maximum entry age or maximum exit age. You’re free to make your own decisions.
Benefits of taking a federal job after age 50
Federal employees can retire with a voluntary retirement and full retirement benefits at the following ages:
- At their minimum retirement age (MRA- somewhere between 55 and 57 depending on when you were born) with 30 years of service
- At age 60 with 20 years of service
- At age 62 with 5 years of service.
So as long as you plan to retire at age 62 or later, you are eligible for some sweet benefits. If you make it to retirement eligibility, you can:
- Continue your FEHB for life, even after you are eligible for Medicare, only paying the employee portion of the premium
- A FERS pension, equal to 1% of your highest 3 years of salary multiplied by your years of service
- The ability to carry Federal Employee Group Life Insurance (FEGLI) into retirement.
Why it could be better to start working for the government at age 55 than age 25.
I started working for the government when I was just 18 years old. I now have over 20 years of service, but still have nearly another 20 to go before I reach my minimum retirement age and can retire.
While there are many days I feel great about my job, part of me also feels trapped by “golden handcuffs” and dream of early retirement. However, I did the math and leaving just 1 day before my minimum retirement age would cost me over a million dollars in lost retirement benefits.
On the other hand, you can qualify for many of those benefits with as little as 5 years of federal service if you retire at age 62.
Example annuity calculation for someone starting in their 50’s
I recently got an email from someone who asked if it was worth it to take a federal job in her 50’s. Even if it didn’t pay as well as her contract job (with no benefits).
I did a quick calculation. Let’s assume:
- This person is hired at age 54 and retires at age 62
- This person makes $75,000 a year
- If she didn’t work for the federal government, she could save an extra $5,000 per year.
If she kept her private sector job, she’d have saved about $40,000 extra for retirement if she put her money in a savings account, or about $53,000 if she invested the money and earned an 8% return.
If she decided to work for the government, she’d earn a pension of $6,000 per year per life (1% per year x 8 years of service x $75,000). While $6,000 doesn’t sound like a lot, if she lived until she was 82, she’d have earned over $120,000 in pension payouts. That’s a lot more than the $53,000 she could have earned by banking an extra $5k per year during her career.
That’s not even mentioning the value of FEHB in retirement. I calculated for me FEHB would be worth at least $400,000 in retirement. And your spouse can continue the benefits even after you pass away!!
Frequently Asked Questions
Does the federal government hire retirees?
Yes. The government considers all applicants regardless of their age for full-time or part-time employment in the federal governmen
What is the maximum age to work for the federal government or maximum age for federal employment?
Unless you’re in a Special FERS category (think firefighter, law enforcement, or air traffic controller) there is no mandatory retirement age.
Is there an age limit for Federal employment?
Most federal agency jobs require you to be at least 18 years old 🙃. But in terms of an upper age to start government service, there is none.
Can you get a federal job at age 50?
Definitely! Government agencies are forbidden from discriminating against people based upon age. Many baby boomers have very solid resumes from decades of advancing through careers. This allows many older workers to be quite competitive in the federal hiring process when a job of interest opens up.
Can a retired government employee be rehired
Yes, retired feds can return to federal programs after they have retired. This is called a “reemployed annuitant“. In short, while you’ll still receive your pension along with your salary, your salary may be reduced.
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SamSam i.e. "Gov Worker" started working for the government at age 18 and loved it so much that he never left. He started GovernmentWorkerFI in 2019 to help fellow federal employees understand their benefits, take control of their finances, and live their best lives.
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