Civil Service Retirement System (CSRS)

Written by True Tamplin, BSc, CEPF®

Reviewed by Subject Matter Experts

Updated on July 11, 2023

Get Any Financial Question Answered

What Is the Civil Service Retirement System (CSRS)?

The Civil Service Retirement System (CSRS) is a defined benefit plan for federal employees in the United States. Established in 1920, CSRS provides retirement, disability, and survivor benefits for eligible federal employees and their families.

The primary purpose of the CSRS is to provide financial security for federal employees in retirement, ensuring a stable source of income based on years of service and salary history.

The CSRS is administered by the Office of Personnel Management (OPM) and is funded through employee and employer contributions, as well as investment earnings.

Eligibility for CSRS

Types of Federal Employees Eligible for CSRS

CSRS covers most civilian federal employees who were hired before January 1, 1984. Employees hired after this date are generally covered by the Federal Employees Retirement System (FERS).

Service Requirements for CSRS Eligibility

To be eligible for CSRS retirement benefits, employees must have at least five years of creditable civilian service.

Special Provisions for Law Enforcement Officers, Firefighters, and Air Traffic Controllers

Certain categories of federal employees, such as law enforcement officers, firefighters, and air traffic controllers, have special provisions under CSRS that allow for earlier retirement and enhanced benefits.

Contributions to CSRS

Employee Contributions

CSRS-covered employees contribute a percentage of their salary to the retirement system, typically around 7%.

Employer Contributions

Federal agencies contribute a matching percentage of the employee's salary to the CSRS, ensuring the system's financial solvency.

Voluntary Contributions

CSRS-covered employees may also make voluntary contributions to their retirement accounts, which can increase their future retirement benefits.

CSRS Benefits

Retirement Benefits Calculation

High-3 Average Salary

Retirement benefits under CSRS are calculated based on the employee's highest average salary over any three consecutive years of service, known as the "high-3" average salary.

Years of Service

The length of creditable service is another crucial factor in determining CSRS retirement benefits.

Benefit Accrual Rates

CSRS benefits accrue at different rates based on years of service, with higher rates for longer tenures.

Survivor Benefits

CSRS provides survivor benefits for the eligible spouse or dependent children of a deceased federal employee or retiree.

Disability Benefits

CSRS offers disability benefits for employees who become unable to perform their duties due to a medical condition.

Cost-Of-Living Adjustments (COLAs)

CSRS retirement benefits are subject to annual cost-of-living adjustments, which help protect retirees' purchasing power against inflation.

Retirement Options under CSRS

Immediate Retirement

Employees who meet the age and service requirements can apply for immediate retirement, with benefits beginning the day after separation from service.

Early Retirement

In certain circumstances, such as during workforce reduction initiatives, employees may be eligible for early retirement with reduced benefits.

Deferred Retirement

Employees who leave federal service before meeting the age and service requirements for immediate retirement may be eligible for deferred retirement benefits, which commence at a later date.

Retirement Options Under the Civil Service Retirement System (CSRS)

CSRS Integration With Social Security

Windfall Elimination Provision (WEP)

CSRS retirees may be subject to the Windfall Elimination Provision, which can reduce Social Security benefits for those who also receive a government pension.

Government Pension Offset (GPO)

The Government Pension Offset may reduce Social Security survivor benefits for spouses of CSRS retirees who also receive a government pension.

Dual CSRS and Social Security Coverage

Some federal employees may have both CSRS and Social Security coverage, depending on their employment history and participation in Social Security.

Civil Service Retirement System (CSRS) Integration With Social Security

Transition From CSRS to the Federal Employees Retirement System (FERS)

Reasons for Transitioning

Some CSRS employees may choose to transition to FERS to take advantage of the Thrift Savings Plan (TSP) and Social Security benefits available under FERS.

Requirements and Steps to Transition

Transitioning from CSRS to FERS requires employees to meet specific eligibility criteria and complete a series of administrative steps, including submitting the appropriate forms.

Impact on Retirement Benefits

The transition from CSRS to FERS can impact retirement benefits, as FERS benefits are calculated differently and may include Social Security and TSP benefits.

CSRS Offset

Definition and Purpose of CSRS Offset

CSRS Offset is a retirement system for federal employees who were rehired after a break in service and are subject to both CSRS and Social Security coverage.

Eligibility for CSRS Offset

Employees who had a break in service of more than one year, returned to federal service after 1983, and have at least five years of creditable civilian service under CSRS are eligible for CSRS Offset.

Impact on Retirement Benefits

CSRS Offset retirement benefits are calculated similarly to regular CSRS benefits, but are reduced by the employee's Social Security benefits attributable to their CSRS Offset service.

Thrift Savings Plan (TSP) and CSRS

Participation in TSP for CSRS Employees

CSRS employees are eligible to participate in the TSP, a defined contribution plan that allows federal employees to save for retirement through pre-tax contributions and receive agency matching contributions.

Contribution Limits and Investment Options

CSRS employees can contribute to the TSP up to the annual limit set by the Internal Revenue Service (IRS), with various investment options available to suit different risk tolerances and investment goals.

Impact on Overall Retirement Savings

Participation in the TSP can significantly enhance overall retirement savings for CSRS employees, providing an additional source of income during retirement.


Importance of CSRS for Federal Employees

The CSRS remains an essential retirement system for many federal employees, providing financial security and stability during their retirement years.

Key Considerations for Planning Retirement Under CSRS

Understanding the various aspects of CSRS, including eligibility, contributions, benefits, and retirement options, is crucial for federal employees to make informed decisions about their retirement planning.

The Role of Financial Planning in Maximizing CSRS Benefits

Working with a financial planner or retirement specialist can help CSRS-covered employees develop a comprehensive retirement strategy that maximizes their benefits and ensures a comfortable retirement.

Civil Service Retirement System (CSRS) FAQs

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.

Meet Retirement Planning Consultants in Your Area