A matter of principal, plus exemptions and calculations

A Reader Writes:

Aren't you mistaken in saying the $7 annuity payment per $100 contribution results in a return exceeding 7 percent? ["Retirement investments revisited"] A substantial portion of the $7 is a return of principal!

Milt Replies:

You can use voluntary contributions you made while working under the Civil Service Retirement System (CSRS) to purchase an additional annuity when you retire or you can withdraw the contributions in a one-time payment.

Your contributions earn interest. The current rate is 5.5 percent, but it has been much higher. When you decide to annuitize your voluntary contribution fund in exchange for $7 per $100, it's true that part of what you're getting is return of principal. However, don't forget that the $7 per $100 is for the rest of your life, so your exact return depends on how long you live.

A Reader Writes:

I'm a GS-2210-11 information technology specialist. I'm classified as exempt under the Fair Labor Standards Act (FSLA), which means my overtime rate is capped at 1.5 times the GS-10 Step 1 pay rate, which is only about $1 more than my regular rate.

The GS-2210-09 IT specialists in my section are designated as nonexempt and receive overtime pay at 1.5 times their regular pay rate.

When I read the FLSA guidelines governing exempt/nonexempt, it says that "Nonsupervisory General Schedule employees at any grade level in occupations requiring highly specialized technical skills and knowledge that can be acquired only through prolonged job training and experience" should be designated nonexempt. It would seem to me that IT specialist would fall in this category.

What is the appropriate method of pursuing a change of designation from exempt to nonexempt?

Milt Replies:

Talk to your human resources department and ask for an explanation. Perhaps there is another document you haven't read that explains this further.

If you believe an error has been made, get in touch with me again, but only after you've fully discussed this with your supervisor.

A Reader Writes:

Last month, you mentioned the free calculator on the FirstGov for Seniors Web site ["'Average' employees, and calculating retirement"].

There is another one. It is at www.fedbens.com. It figures the earliest date an employee can retire—both "full" retirement and partial (early out)—for CSRS and Federal Employees Retirement System participants, special employees (fire, police, etc.), and regular employees. Best of all, it is 100 percent free.

The FirstGov calculator does not do the above.

Zall is a retired federal employee who since 1987 has written the Bureaucratus column for Federal Computer Week. He can be reached at milt.zall@verizon.net.

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