The end of the ‘Fork in the Road’

Here we are, at the end of the road – the end of the Fork in the Road, that is. The good news: since Jan. 1, the Office of Personnel Management has processed 77,580 retirement claims through August. By that same date, OPM had received 88,062 claims – 10,482 more than processed – leaving just over 10,000 claims still in the pipeline.

September numbers should be released shortly after Oct. 1.

These won’t include employees retiring Sept. 30. You might wonder why OPM hasn’t received those claims yet, given that many of these soon-to-be retirees knew their last day would be Sept. 30 after accepting the DRP offer earlier this year. After all, they had plenty of time to file their retirement “papers.”

The delay comes down to the federal transition from employee to annuitant. First, the HR office reviews the retirement package after the employee submits paperwork. The agency payroll provider can’t finalize the submission to OPM until after retirement, so OPM has an accurate record of service and salary. And because retirement is voluntary, employees can rescind applications up to their separation date.

Until this summer, retirement forms – either electronic or handwritten – were sent to OPM via FedEx or U.S. Mail. To streamline the process and cut errors, OPM launched the Online Retirement Application system around the same time the One Big Beautiful Bill Act (OBBBA) became law on July 4. Both ORA and OBBBA have shaped the flow of retirement applications this year.

Some OBBBA proposals threatened federal retirement benefits, prompting employees to retire earlier. Those changes were ultimately removed, but not before OPM received 15,048 claims in May and 13,430 in June – far above the usual fewer than 7,000 in each month in 2024.

This surge strained agency retirement specialists, many of whom were planning summer vacations – or leaving federal service themselves. One HR specialist noted that, in a normal year, retirement specialists process about 10 applications a month, with spikes at year-end. Many offices were unprepared for the unusually busy summer.

The shift from paper to digital applications has been in the works for years. A 2011 GAO report also highlighted OPM’s long history of retirement modernization projects with mixed results.

The benefits of ORA include:

• Handling more applications efficiently and accurately.
• Standardizing the process to reduce inconsistencies and errors.
• Digitizing files for easier verification of service credit and record storage.

Still, timing is everything. Introducing a new system while employees make major life decisions adds stress, and HR employees implementing it feel the burden. OPM has produced training videos and guides to ease the transition.

Applications cannot be submitted to OPM until complete. ORA includes checklists to ensure all areas are finished and documents uploaded. In the past, applications often arrived missing signatures, information, or documentation. OPM’s monthly agency retirement case accuracy report shows 81–84% of cases are “healthy,” leaving 15–20% incomplete. Past Benefit Administration Letters explained the requirements. ORA now requires “healthy” submissions, which can delay preparation by employees, HR offices, and payroll providers.

Employees who previously submitted via Government Retirement and Benefits software must resubmit in ORA if retiring this month—a source of confusion, since some thought their GRB applications would be accepted. ORA is now in version 3.

OPM’s Retirement Quick Guide, last updated in April, predates ORA. It notes that processing annuities cannot start until after separation and typically takes three to five months.

The workflow requires:

• Initial review of the application (streamlined by ORA)
• Interim payments during final review
• Verification of federal service and earnings
• Calculation of annuity and benefits (final calculations may be delayed for CSRS Offset, court orders, part-time service, and other complexities)
• Final approval and payment

Timing varies depending on service history complexity and application volume.

To prepare:

• Submit your application early—several months ahead is ideal.
• Confirm service records and earnings statements are accurate.
• Consult HR for guidance on timing, service history, and elections.
• Monitor OPM communications and expect possible delays during peak periods.

Employees retiring between Oct. 1 and Dec. 31 who plan to change health insurance during Open Season should note that FEHB effective dates differ for employees and annuitants. Employees’ elections take effect the first day of the first full pay period on or after Jan. 1; annuitants’ elections take effect Jan. 1. 

This does not affect U.S. Postal Service employees, annuitants or compensationers under PSHB.

Federal couples where one spouse is retiring can choose for the working spouse to carry the FEHB or PSHB coverage to continue receiving the pre-tax benefit for premiums. This is accomplished by switching the coverage from the spouse who is retiring (or has retired) to the spouse who will continue to work.  This can be a tricky maneuver, so be sure to contact HR, where new guidance is outlined in a recent Benefits Administration Letter: FEHB Enrollment Coordination for Married Federal Employees and Annuitants, BAL 25-102. If both spouses are retired, contact OPM.

Most employees will transition smoothly, though some may have their patience tested during this busy season.

Note: If your retirement date is between Oct. 1, 2025, and Dec. 31, 2025, you were still eligible for the Deferred Resignation Program (unless your position was exempted from the DRP by your agency).  If your retirement date is within this window, your deferred resignation date will be extended to match your retirement date.