Ask any financial advisor when the best time is for a client to retire, and you’ll probably get the answer, ‘when they’re ready.’

That isn’t as obvious an answer as it sounds. The ideal time to retire requires not only financial preparedness but psychological preparedness as well.

“It’s all about being mentally prepared for retirement,” according to Tammy Flanagan, senior benefits director at the National Institute of Transition Planning, Inc. “I met a woman this week who continues to work because she likes her job. She has 37 years of government service, but she’s not ready to retire yet.”

For federal employees like this woman, the answer just may lie in the new Phased Retirement program, which formally went into effect in August. The first applications were eligible to be submitted as of November.

According to the Office of Personal Management, “Phased Retirement is a human resources tool that allows full-time employees to work part-time schedules while beginning to draw retirement benefits.  This new tool will allow managers to better provide unique mentoring opportunities for employees while increasing access to the decades of institutional knowledge and experience that retirees can provide.”

Helping Hand for Federal Employees

Started in 1984, the National Institute of Transition Planning helps train federal employees on pre-retirement and mid-career benefits planning. That includes understanding their federal benefits and tax issues. Seminars are usually conducted at the various federal agencies.

“We help them understand what else they can do, how to find a new career path, or how to look for volunteer opportunities after retirement,” Flanagan said.

While many individuals in the general population are choosing to delay full retirement, it’s a “mixed bag” with federal employees, Flanagan said.

“We have federal employees who started right out of school and stayed the full service in the government. Those employees typically want to retire in their 50s or at the very latest early 60s. Then you have people who came into federal service as a second career. Many military retirees will come into civilian federal service and then they’ll retire. Maybe after 20 years in government they might be in their late 60s. Every once in a while you’ll get someone in their 70s or later. But usually it’s early to mid-50s to early 60s,” Flanagan said.

Traditional Times for Retirement

Whatever their age, there are still certain dates that are better than others to retire when your employer is Uncle Sam. And not surprisingly, this is the busiest month of the year for federal retirements.

“In an average month about 6,000 to 10,000 employees retire,” said Flanagan. “At the end of the year, we’ll see in the neighborhood of 18,000 to 22,000 employees retire.”

The reason is simple.

“It used to be that when a person retired from federal service there was a transition from their agency to the pension program under the Office of Personal Management. So when they retired it would take two or three months to get that settled. In many cases workers would get their last pay check and then not get their retirement check for two or three months. So we would always encourage our employees to wait to the end of the year. They could save up all their vacation time for the last year that they worked and the agency would pay them for that unused annual leave.”

But even if a federal employee isn’t waiting until the end of the year to retire, the end of the month is still the best time.

“Federal employees retire at the end of the month because their retirement benefits don’t start until the first of the following month. So whether they retire on Dec. 1 or Dec. 31, they’re still not going to get a retirement package until January, so they might as well get paid their salary for the last month that they worked,” Flanagan said.

The New Phased Retirement Program

For employees that want to ease into retirement, the new Phased Retirement program is just what the doctor ordered, Flanagan said.

“What it allows people to do is collect half of their benefits – half of their pensions.” Once they officially ‘retire,’ “they come back to work on Monday and they’ll work 20 hours instead of 40. They’ll hopefully be allowed to do that for a couple of years, and then they can decide when they want to fully retire,” Flanagan said.

This type of partial retirement has never been offered before, and Flanagan says many agencies are “being very cautious about implementing it. A lot of agencies are saying that in early 2015 they’ll have it ready. It will be interesting to see what people do, and if it becomes widely available.”

It will also be interesting to see how federal employees take advantage of the new program from a gender perspective. As Flanagan notes, women are generally more accustomed to being out of the workforce for a certain period than men are, and this makes retirement less frightening from a mental preparedness perspective.

“With most of the women I talk to, they’ve been planning for retirement for a long time. And some of them have taken breaks in their careers to stay home with kids, so this is something that they’re not as fearful of. They know how to spend their time, and they’ve done that in the past,” Flanagan said.

With many men, it’s a different picture.

“The men have worked full time their whole careers,” Flanagan said. “I worry about them, because they seem the most fearful about it and are the most concerned. They worry about what else they are going to do because many don’t have hobbies and other interests. Working has been their whole career.”

The Best Dates for Federal Employees to Retire in 2015

January

Thursday to Saturday, Jan. 1-3 – Beginning of the month / Three day grace period

Saturday, Jan. 10 – Mid-month leave period

Saturday, Jan. 24 – Mid-month leave period

Saturday, Jan. 31 – Last day of the month / First week of a leave period

February

Sunday to Tuesday, Feb. 1-3 – Beginning of the month/Three day grace period

Saturday, Feb. 7 – Mid-month leave period

Saturday, Feb. 21 – Mid-month leave period

Saturday, Feb. 28 – Last day of the month / First week of a leave period

March

Sunday to Tuesday, March 1-3 – Beginning of the month/Three day grace period

Saturday, March 7 – Mid-month leave period

Saturday, March 21 – Mid-month leave period

Tuesday, March 31 – Last day of the month

April

Wednesday to Friday, April 1-3 – Beginning of the month/Three day grace period

Saturday, April 4 – Mid-month leave period

Saturday, April 18 – Mid-month leave period

Thursday, April 30 – Last day of the month / End of a leave period if you worked a compressed schedule or flex time

May

Friday to Sunday, May 1-3 – Beginning of the month/Three day grace period

Saturday, May 16 – Mid-month leave period

Saturday, May 30 – End of a leave period (Flanagan notes this is a better day than May 31, “unless you need the extra day of service to increase your creditable service by another month”)

Sunday, May 31 – Last day of the month

June

Monday to Wednesday, June 1-3 – Beginning of the month / Three day grace period

Saturday, June 13 – Mid-month leave period

Saturday, June 27 – Mid-month leave period

Tuesday, June 30 – Last day of the month

July

Wednesday to Friday, July 1-3 – Beginning of the month / Three day grace period

Saturday, July 11 – Mid-month leave period

Saturday, July 25 – Mid-month leave period

Friday, July 31 – Last day of the month / First week of a leave period

August

Saturday to Monday, Aug. 1-3 – Beginning of the month / Three day grace period

Saturday, Aug. 8 – Mid-month leave period

Saturday, Aug. 22 – Mid-month leave period

Monday, Aug. 31 – Last day of the month

September

Tuesday to Thursday, Sept. 1-3 – Beginning of the month / Three day grace period

Saturday, Sept. 5 – Mid-month leave period

Saturday, Sept. 19 – Mid-month leave period

Wednesday, Sept. 30 – Last day of the month

October

Thursday to Saturday, Oct. 1-3 – Beginning of the month / Three day grace period

Saturday, Sept. 3 – Mid-month leave period

Saturday, Sept. 17 – Mid-month leave period

Saturday, Oct. 31 – Last day of the month / End of a leave period

November

Sunday to Tuesday, Nov. 1-3 – Beginning of the month / Three day grace period

Saturday, Nov. 14 – Mid-month leave period

Saturday, Sept. 28 – Mid-month leave period

Monday, Nov. 30 – Last day of the month

December

Tuesday to Thursday, Dec. 1-3 – Beginning of the month / Three day grace period

Saturday, Dec. 12 – Mid-month leave period

Saturday, Dec. 26 – Mid-month leave period

Thursday, Dec. 31 – Last day of the month / Last day of the year

(Source: National Institute of Transition Planning)