Typical Situations

Other sections of this web page have described the differences between the High-36 and REDUX/Bonus retirement options. There are three main differences: 1) $30,000 bonus at 15th Year of Service if you elect REDUX, 2) a reduced multiplier before age 62, and 3) reduced cost of living adjustments that are one percent below the CPI (readjusted at age 62).

Your preferred retirement option may depend on whether you consider that the bonus offsets the reduced multipliers and COLAs. How you determine this will depend upon many factors: the projected years of service and grade at retirement, how the bonus will be used, economic factors, and more. Comparisons between the two retirement options follow for some "typical" retirement situations. These comparisons are sensitive to the assumptions made for each situation. Please view the section entitled Common Assumptions in conjunction with the results. Afterwards, review the section entitled Considerations for a discussion on points that may not have been highlighted by the typical case illustrations. All examples assume you invest the bonus or a portion of your retired pay. If you spend the money, there will be no investment accumulations. All of these examples are based on electing CSB as a single lump sum payment in 2001.