Q: Can members of Congress retire and receive their full pay after serving one term?
A: No. Only senators are eligible for a pension after one term, but it won’t be their full salary.
Do the members of Congress get full pay having served just one term in office?
We last wrote about congressional pensions in 2007. But it’s one of the topics we’re asked about most often by visitors to our website.
With a new Congress beginning and numerous members leaving office, we thought it was about time for an update on pension and health benefits for former members.
As we said seven years ago, members of Congress do not receive their full pay as a pension upon leaving office. That’s the case whether they served one term or several.
The basic eligibility for collecting a pension is as follows, according to a June report from the Congressional Research Service, the nonpartisan research arm of Congress:
CRS, June 13: Members of Congress are eligible for a pension at the age of 62 if they have completed at least five years of service. Members are eligible for a pension at age 50 if they have completed 20 years of service, or at any age after completing 25 years of service. The amount of the pension depends on years of service and the average of the highest three years of salary. By law, the starting amount of a Member’s retirement annuity may not exceed 80% of his or her final salary.
That means that members of the House of Representatives — who are up for reelection every two years — would not be able to collect pensions of any amount if they only served one term. U.S. senators, on the other hand, serve six-year terms and would be able to collect pensions after one full term. But the pensions wouldn’t be equal to their full salaries.
Take Kay Hagan, the North Carolina senator who lost her bid for a second term, for example. After finishing just one six-year term in the Senate, Hagan, who will turn 62 in 2015, will be eligible for a pension of nearly $16,000, according to calculations done by the conservative National Taxpayers Union. Hagan’s pension would be a little more than 9 percent of her most recent salary of $174,000, the amount paid to rank-and-file House and Senate members.
Now, it is possible that a longtime member of Congress retiring with a starting pension near or equal to 80 percent of his or her final salary could — after many years of annual cost-of-living adjustments — see that pension rise to equal his or her final salary. Retiring Iowa Sen. Tom Harkin is someone who comes to mind.
The 75-year-old Harkin, who served for 30 years in the Senate and 10 years in the House before that, will be eligible for a starting pension of $125,000, according to estimates from the taxpayers union. His retirement pay would be almost 71 percent of his final salary.
But Harkin is an exception. Pensions for most members are far less than that.
According to the Congressional Research Service, as of Oct. 1, 2013, there were 367 former members of Congress who had retired under the Civil Service Retirement System, the old system that was criticized for being too generous. Those members were receiving an average annual pension of $71,664. The pensions of the 250 former members who retired under the Federal Employees Retirement System, which began in 1987, average even less. Their average pension was $42,048 in 2013, CRS said.
Pelosi Won’t Get $803,700
A chain email we’ve received from time to time also claims that House Minority Leader Nancy Pelosi will get “$803,700 Dollars a year for LIFE including FREE medical.”
That’s way off base. To get that figure, the email’s anonymous author added together Pelosi’s old House speaker salary of $223,500, her current salary of $193,400, the $174,000 paid to most members of Congress, and then an additional $212,800 for “free medical.”
That’s just bad math. Congressional pensions aren’t calculated that way, and members of Congress don’t receive free health care while in office or upon retirement.
Under the Affordable Care Act, beginning in 2014, insurance coverage for members of Congress switched from the Federal Employees Health Benefits Program, the government’s employer-subsidized private insurance plans that cover more than 8 million federal employees and retirees, to the health care exchanges created by the law. Active members now must purchase a plan under the small-business health options program on the exchange in order to receive a government contribution toward their health coverage.
But going forward, congressional retirees, based on an October 2013 final rule issued by the Office of Personnel Management, will still be eligible to purchase insurance through the FEHB plan if they meet certain criteria. The criteria, according to CRS, are eligibility for retirement from the federal government, and continuous enrollment in a health plan offered under FEHB or the exchanges for the five years of service immediately prior to retirement.
In either case, health coverage for retirees isn’t free. Enrollees and the government both pay for the insurance coverage. On average, the government pays 72 percent of the premiums for its workers, up to a maximum of 75 percent depending on the policy chosen. As federal retirees, former members of Congress would still be responsible for paying the same share of premiums as active federal employees.
Also, pension benefits for members aren’t calculated by simply adding together previous salary amounts. Benefits are determined by the average annual salary for the three consecutive years of highest pay, the number of years served under a member’s pension plan, and the “accrual rate” at which benefits accumulate for each year of service.
Pelosi, who has served in Congress since 1987, would receive her pension through the FERS plan, if she chose to participate. The accrual rate for service under FERS is 1.7 percent for the first 20 years, and 1 percent for each year after.
But, according to CRS, it would take at least 66 years of service before Pelosi, who will turn 75 in 2015, could retire and immediately begin receiving even 80 percent of $221,467, which is the average of her highest three years of salary.
Pelosi, who is already one of the wealthiest members of Congress, would be entitled to a generous pension whenever her congressional service ends. But it won’t be anywhere close to the $803,700 that a chain email claims she will get.
— D’Angelo Gore
Isaacs, Katelin. “Retirement Benefits for Members of Congress.” Congressional Research Service. 13 Jun 2014.
Mach, Annie and Ada S. Cornell. “Federal Employees Health Benefits Program (FEHBP): Available Health Insurance Options.” Congressional Research Service. 13 Nov 2013.
Jackson, Brooks. “Congressional Pensions.” FactCheck.org. 26 Dec 2007.
Roll Call. Casualty List: 113th Congress (2013-2014). 17 Dec 2014, accessed 24 Dec 2014.
Hotakainen, Rob. “A $130,500 pension? Some in Congress say no, but most cash in.” McClatchy Newspapers. 25 Nov 2014.
Alpert, Bruce. “Mary Landrieu’s pension will be $48,000 a year, starting at age 62, says National Taxpayers Union.” Times Picayune. 16 Dec 2014.
Roll Call. Wealth of Congress. Accessed 24 Dec 2014.