Today I wanted to start with a common misconception which keeps on getting brought up and reposted, but which is not true.
This claim is a classic in its own right. The urban legend checker Snopes.com says it has been circulating in various chain emails since at least 2000. Both claims seem to point to all members of Congress no matter how long they have served, including one term Representatives.
The claim means that rank-and-file members of the House of Representatives would receive full pay of $174,000 per year, for the rest of their lives, after serving as little as two years.
Nice work if you can get it. But members of Congress can't.
A report on "Retirement Benefits for Members of Congress," prepared in November by the nonpartisan Congressional Research Service (CRS), outlines how pension benefits are to be calculated. Members of Congress are part of the federal retirement system, and as such they fall under the same rules.
The key provision: no member of Congress is eligible for any pension unless he or she has served in Congress(or other federal position) for at least five years. (Senators serve six-year terms; House members must seek reelection every two years.)
To collect, a congressman or senator must be age 62, or be at least age 50 with 20 years of service, or be any age with 25 years of service.
Under the most recent pension program, adopted in 1984, the size of a pension is based on the highest three years of a member's salary, the number of years of service and a multiplier, which is 1.7 percent for the first 20 years of service and 1.0 percent for subsequent years.
Here’s an example, using a typical 25-year rank-and-file member who retired this year. The pension would be the sum of two calculations. First, multiply $172,443 [the average salary over the last three years] times 20 years times 0.017. Then, multiply $172,443 times 5 years times 0.01 and add that number to the first calculation. The total: about $67,250 per year.
A three-term congressman (or one-term senator) who has now reached retirement age would be eligible for an annual pension of $17,588 for six years of work. That's generous, but not close to full pay.
Federal law prevents members of Congress from getting full-pay retirement when they leave office. The report says, "By law, the starting amount of a member's retirement annuity may not exceed 80 percent of his or her final salary."
Under the formula, it would take 67 years of service to hit that limit. Considering the minimum age requirements for members of congress (30 for senator 25 for house), as well as it being very unlikely that members of Congress would be reelected enough times or not retire before that point this is unlikely.
So this meme saying that members of Congress can "receive full pay retirement after serving one term" is blatantly bogus. It's never full pay and the only one-term members who would be eligible for any pension would be senators.
