Posted on Friday, 1st November 2013 by

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Federal retirees, social security recipients, and military retirees will receive a 1.5% COLA next year!  This is the lowest COLA since 1985 not counting the two years we did without one. Based on the average retiree’s annuity the 2014 COLA will add approximately $48 monthly for CSRS retirees and $18 for FERS retirees age 62 or older.  It’s hard to believe inflation was only 1.5% considering all of the increases my wife and I have experienced first hand in just about everything we purchased this year plus our FEHB health insurance premiums are scheduled to increase an average of 4.4% for 2014. About the only thing that I see going down is our standard of living these days however that is another story of and in itself.

The rules for federal employees who wish to apply their military time towards retirement have changed.  OPM issued a Benefits Administration Letter this year that discontinued the practice of allowing employees to complete payment of their Post-1956 Military Service Deposits after separation. They did allow one exception for administrative error that would have prevented the employee from completing their deposit prior to separation.

Previously you could submit military deposit paperwork with your retirement forms and make payment to your agency prior to adjudication of your retirement claim. however now you must initiate the paperwork and complete payment to your agency prior to separating.  It can take months to receive pay estimates from military finance centers, make payment to the agency, and receive confirmation of payment. Start the process long before you retire if you decide a military deposit makes sense to you.

The Benefits Administrative Letter states that “The retirement applications for CSRS and FERS, SF 2801 and SF 3107 respectively have since been revised and the OPM form 1515 has been discontinued. Both applications now clearly state the deposit must be completed before separation.”   These forms are available for download with revision dates of June 2007 and May 2012 respectively.  It appears that instead of issuing new revised forms OPM simply added the statement (You must make this deposit to your agency. You cannot pay OPM after you retire) to the existing forms under Schedule A – Military Service Information, item number 2. 

Because the applications clearly state the fact that deposits must be completed before separation, OPM will not grant an exception for employees who were counseled but have not yet separated. These employees must be informed of the correct procedures regarding the payment of military deposits.

Many who served in the military have questions about the impact, if any, that a deposit will have on their military benefits. If you make a military deposit, there is no effect on your other military benefits such as medical benefits, base access, commissary, or VA benefits, including any disability payments from the VA. It only affects (active duty) retired military pay; you cannot receive 2 separate retirements (military and civilian) for the exact same period of service. Reserve or National Guard members under Title 32 can collect both a federal civil service retirement and a Reserve or National Guard retirement.

Other Military Deposit Resources:


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The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Last 5 posts by Dennis Damp


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