The Federal Employees’ Retirement System Act of 1986 (FERSA) granted the Office of Personnel Management (OPM) and federal agencies broad authority to design and implement retirement education programs for employees covered by the two largest federal civilian retirement programs—the Civil Service Retirement System (CSRS) and the Federal Employees’ Retirement System (FERS). OPM's and Experts' Recommendations for Federal Retirement Education Programs

OPM and the experts with whom we consulted held generally consistent views regarding the recommended content, presentation formats, and timing of retirement education programs. The experts identified the following 13 topics as being essential to a retirement education program: plan type, including whether an employee is covered by CSRS or FERS; participation and vesting requirements, or the amount of time that employees must work before they are eligible to (1) contribute to and (2) own, or become “vested” in, accrued benefits of their plan; employer and employee contributions that are allowed and/or required; estimated assets needed to retire that reflect individual employee’s desired retirement date, income level, and lifestyle; investment alternatives and strategies, including information on the association between investment risk and return, the benefits of saving earlier rather than later, and the importance of diversification across different types of investment vehicles; debt management that provides employees with information on how to manage limited resources efficiently and enhance their ability to save; tax considerations, including the benefits of saving with pretax versus retention of agency-provided health and life insurance benefits; minimum voluntary retirement dates; projected benefit amounts and COLA’s; disability and survivor insurance, including how these programs are integrated with their other retirement benefits and any associated costs to employees;
Social Security and Medicare, including whether employees are covered by these programs, how the programs are integrated with their other retirement benefits, and any associated costs to employees; and
Medigap and long-term care insurance, that is, insurance designed to provide coverage for medical costs not covered by Medicare or other federal health insurance. This approach would also provide employees with the opportunity to attend seminars periodically throughout their careers. As part of its governmentwide responsibility for federal retirement systems, OPM supplemented the guidance it provided to agencies on the design and implementation of retirement education programs by developing educational materials, sponsoring training, and providing technical advice to agencies’ benefits personnel. Agencies, which had primary responsibility for developing retirement education programs, generally provided information to employees on topics such as the basic features of CSRS and FERS and financial planning issues for retirement, which were recommended by OPM and the retirement experts with whom we consulted. For example, agencies’ officials told us that they included information on the basic features of CSRS and FERS, financial planning for retirement, and maintaining federal health and life insurance in retirement. Officials said that agencies provided retirement planning information, but not advice, regardless of the topics included. Agencies’ Retirement Education Programs Included a Variety of Presentation Formats

Consistent with OPM and expert recommendations, the officials representing the agencies we surveyed told us that they used a variety of presentation formats in their retirement education programs, including written publications, interactive formats such as seminars and one-on-one counseling, and electronic formats such as Web sites and automated systems. Agencies’ officials told us that they view retirement education as a shared responsibility between the agencies and employees. All of the agencies we surveyed sponsored retirement seminars that were designed for employees who were approximately within 5 years of being eligible to retire. All of the agencies we surveyed told us that one-on-one counseling was available to employees at any point in their careers upon request.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed the retirement education that the Office of Personnel Management (OPM) and agencies provide to federal civilian employees covered by the Civil Service Retirement System (CSRS) or the Federal Employees' Retirement System (FERS).

What GAO Found

GAO noted that: (1) OPM and the experts with whom GAO consulted held generally consistent views regarding the recommended content, presentation formats, and timing of retirement education programs; (2) they believed that these programs should provide employees with information on certain topics, or content such as plan features and financial planning, and that other agencies should consider using multiple formats so as to accommodate employees' varying needs; (3) they also believed that such information should be provided early and throughout employees' careers; (4) OPM provided guidance to agencies on the design and implementation of retirement education programs and supplemented the guidance with educational materials, training, and technical advice for agencies' benefits staff; (5) agencies had primary responsibility for designing and implementing their programs according to their agency-specific needs; (6) the retirement education programs of the agencies reviewed generally included those topics recommended by OPM and the experts; (7) in providing retirement education, agencies' officials said that they made information available on a variety of topics, including the specific features of CSRS and FERS, the requirements for maintaining federal health and life insurance benefits in retirement, and financial planning for retirement; (8) agencies' officials told GAO that they used a wide variety of presentation formats to communicate retirement education to their employees; (9) all of the agencies that GAO reviewed provided employees with written educational materials that were supplemented with interactive seminars and one-on-one counseling; (10) agencies provided retirement planning information, but not advice, regardless of the presentation format used; (11) agencies' officials also said that they generally provided retirement education to employees during their initial orientation and throughout their careers; (12) all of the agencies in GAO's review sponsored seminars designed for those employees who were nearing retirement eligibility; (13) some agencies also sponsored additional seminars that were specifically designed for employees who had approximately 15 years of federal service to encourage employees to begin planning for their retirement earlier in their careers; (14) agencies also provided one-on-one counseling at any time upon request; and (15) agencies believed that retirement education is a shared responsibility between agencies and employees, and that employees must ultimately decide for themselves whether or when to seek retirement information.