By: Monica Stevens
For federal employees diligently counting down the days until their hard-earned retirement, there’s one crucial date that cannot be overlooked – the Retirement Service Computation Date (RSCD). This date, which is distinct from the Leave Service Computation Date on earnings statements, determines how many creditable years of service will be factored into calculating an employee’s pension payments.
“Failing to verify your accurate RSCD can potentially cost a federal retiree thousands of dollars over the course of their retirement,” warns David Fei, co-founder of PlanWell Financial Planning in Alexandria, VA. “We can’t stress enough how important it is for federal workers to confirm this date well before filing retirement paperwork.”
The RSCD accounts for any gaps or unique circumstances in an employee’s tenure, such as breaks in service, military time bought back, or starting with a higher rate of accrued leave. A recent Federal News Network article highlighted just how much of an impact these situations can have, citing a federal retirement data analysis that found “about 73% of federal retirements had some sort of service credit issue resolved after the initial retirement calculations.”
Fei and his partner Brennan Rhule have made it standard practice to review clients’ service histories and walk them through the process of officially verifying their RSCD years before retirement. This helps avoid nasty surprises when the Office of Personnel Management (OPM) conducts its final review upon an employee’s retirement filing.
“By being proactive, we can identify any potential discrepancies ahead of time and work with the agency to get them corrected,” explains Rhule. “No one wants to go through retirement only to realize their monthly pension is lower than expected because of an overlooked service period.”
To officially confirm your RSCD, federal employees need to submit an SF-3107-1 form to their Human Resources department requesting a “Certified Summary of Creditable Service.” HR will then verify the RSCD calculation based on a review of the employee’s personnel records.
Rhule notes that requesting this verification sooner rather than later is advisable given the extensive documentation involved. This also provides ample time to remediate any issues that may arise.
“We’ve seen cases where database errors or missing paperwork led to undercounting of service credits,” says Rhule. “The earlier you get ahead of this, the smoother the resolution process will be rather than attempting to deal with it under retirement time crunch.”
Both Fei and Rhule hold the Chartered Federal Employee Benefits Consultant (ChFEBC™) designation, specializing in the nuances of federal retirement planning. Their experience working with federal employee clients at all career stages has exposed them to common pain points and potential pitfalls.
By taking a proactive, educated approach to validating the RSCD well before retirement, the PlanWell Financial Planning team aims to ensure none of their federal worker clients leave money on the table from their pension. After decades of dedicated service, maximizing hard-earned retirement benefits should be a top priority.
“An incorrect RSCD can negatively impact your retirement for the rest of your life,” states Fei. “We consider it our duty to help our federal clients avoid that costly mistake from day one. Verifying this date is something no employee should overlook.”
As part of its commitment to providing free financial education opportunities, Planwell Financial Planning regularly conducts federal retirement webinars. These interactive online workshops cover a range of topics, including FERS pensions, the Thrift Savings Plan, and more. Those interested can check out the webinar schedule: https://www.planwellfp.com/federal-retirement-webinar-workshop/.
Published by: Holy Minoza
