Best Dates for FERS Employees to Retire in 2025

Is There Actually a Best Date to Retire?

In short, yes.  

As a FERS employee, your retirement date is set at the first day of the month after you choose to retire. You’ll then receive your first FERS annuity check on the first day of the following month. 

For example: Paul chooses to retire on May 15. His retirement date is set as June 1, and he receives his first FERS annuity payment on July 1. 

This will leave a gap between your last working paycheck and your first annuity payment. Strategizing on the right date can help minimize this gap and its effects on your cash flow.  

How Do I Figure Out Which Date to Retire?

Since your retirement date is always set as the first day of the month after you retire, a general rule of thumb is to retire on the last day of the month – regardless of the day of the week it falls on.  

Selecting a date later in the month can mean a difference of waiting five or eight weeks before receiving your first FERS paycheck. 

However, there is more to consider when choosing a retirement date. 

Maximizing Annual Leave for Retirement

When you retire, your accrued Annual Leave is paid out as a lump sum. This cash payout can help fill the gap between your last working check and first annuity check. Therefore, you’ll want to maximize the amount of annual leave you’re cashing out. 

To make the most of your accrued leave and minimize this gap, it would be most strategic to retire at the end of a pay period, if possible. Even better, choosing a pay period that ends towards the back half of the month to both maximize your accrued leave and reduce the gap before FERS annuity payments begin. 

To ensure you don’t lose any accrued leave, retire before the “use it or lose it” deadline, which changes annually.  For 2025, the deadline is Saturday, November 29. 

Finally, keep in mind that your Annual Leave lump sum is taxable and adds to your yearly earnings. Consult your tax advisor to determine the optimal time to retire, which might involve retiring earlier in the year to minimize your tax liability.  

Combining these strategies can help you pinpoint the best date to retire, considering your cash flow needs. 

Best Dates to Retire in 2025

Taking all these considerations into account, here are some optimal retirement dates for FERS employees in 2025:

• Friday, May 31
  • Retirement date: June 1
  • Annuity payments begin, July 1
• Saturday, June 28
  • Retirement date: July 1
  • Annuity payments begin: August 1
• Saturday, November 29
  • Retirement date: December 1
  • Annuity payments begin: January 1, 2026
• Wednesday, December 31
  • Retirement date: January 1, 2026
  • Annuity payments begin: February 1, 2026
  • Retiring on December 31 is always a good option and allows you to begin with a fresh start in the new year.

Other Factors to Consider

When choosing a retirement date as a FERS employee, there are other factors to weigh, including: 

• Social Security Age Milestones: Waiting until your Full Retirement Age (FRA) can increase your monthly Social Security payments. 
• Thrift Savings Plan (TSP) withdrawals: Consider how your retirement date impacts the performance of your TSP investments.   
• Healthcare Considerations: Understand how your retirement date affects when your Federal Employees Health Benefits (FEHB) become effective. 

When Do You Want to Retire?

While it is important to take these financial factors into consideration, remember that retirement is about enjoying the next phase of your life.  Think about your personal retirement plans and objectives.  

As you prepare for this significant transition, explore WAEPA’s retirement planning resources to ensure a smooth and secure journey.  

WAEPA’s Free Financial Wellness Program

WAEPA members have access to an EY financial planner who can help review your budget, address student loan debt, and make progress step-by-step.

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Founded in 1943, WAEPA provides current and former Civilian Federal Employees with exclusive Group Term Life Insurance and Short-Term Disability Insurance. WAEPA members have access to resources, tailored specifically to the needs of Feds and their families. Today, more than 50,000 Feds and their families choose WAEPA to be there for life’s biggest moments.