Should You Keep Your FEHB in Retirement?

Should You Keep Your FEHB in Retirement?

Federal employees have some of the best benefits around, from your retirement system to your Federal Employee Health Benefits (FEHB, for short). Unlike many private sector employees, you can even keep your FEHB after you retire! That’s an incredible value, considering how most other workers have to wait until they’re eligible for Medicare to retire, or find some way to provide themselves with health insurance.

Of course, like anything else, keeping your FEHB in retirement is subject to some rules. Luckily they’re pretty straightforward:

  • You must be “entitled” to an immediate retirement when you leave your position
  • You have had FEHB for the five years immediately preceding retirement (or you have FEHB less than five years, but did enroll immediately when you became eligible)

There are only two basic requirements, but that first one is a bit confusing, isn’t it? To clarify, pay special attention to this rule if you’re considering a postponed or deferred retirement. If you opt for deferred retirement, you can’t keep your FEHB. But if you separate with a postponed retirement, you can. Yes, it’s complicated, so schedule an appointment with us to discuss your FEHB before opting for retirement.

So why do many federal employees choose to keep their FEHB? It’s simple, really:

  • The federal government will pay for 72 percent of your premiums.
  • The FEHB is one of the best group health insurance plans on the market, because covering a large group of people usually keeps premiums low and benefits high.
  • You have more flexibility in your retirement planning; you don’t have to purchase your own health insurance plan, with rates that can vary wildly, or wait until you’re 65 and eligible for Medicare.

These are all terrific benefits, but not every situation is the same. For more information on keeping your FEHB after you retire, call us to set an appointment. We can discuss all of your retirement plans, keep you in the loop on changes to the federal employee retirement system, and help you make the decisions that work best for your situation.