Understanding Florida's DROP Program

Posted On: September 18, 2025

If you're approaching retirement eligibility under the Florida Retirement System (FRS) Pension Plan, you may have heard about the Deferred Retirement Option Program, commonly known as DROP. This unique benefit allows eligible employees to have the best of both worlds: retire and continue working simultaneously. 

How DROP Works 

DROP allows you to retire effectively under the FRS Pension Plan while still earning a salary. During the DROP period (up to 96 months), your monthly retirement benefits earn interest. Instead of receiving monthly retirement payments, these funds accumulate in a special DROP account where they earn interest. Meanwhile, you continue working and receiving your regular paycheck and employee benefits. 

Eligibility Requirements 

To participate in DROP, you must be a member of the FRS Pension Plan (Investment Plan members are not eligible) and meet two key criteria: you must be vested in the system and have reached your normal retirement date. You may enter DROP at any time after you are vested and have reached your normal retirement date. For Special Risk Class members, the minimum age to potentially defer DROP participation is 55, though those with 25 years of service may be eligible regardless of age. While there is no maximum age limit published for DROP participation, the program's 96-month duration means most participants complete their DROP period well before typical mandatory retirement ages. 

Program Benefits 

The primary advantage of DROP is the ability to accumulate a substantial lump sum while maintaining your current income and benefits. During your DROP participation, you'll continue to accrue vacation and sick leave, maintain health insurance at active employee rates, and remain eligible for salary increases and promotions. However, you won't earn additional retirement service credit during this period. 

Important Considerations 

The standard DROP participation period lasts up to 96 months (eight years). At the end of your DROP period, you'll receive a payout of your accumulated benefits plus interest and begin receiving your regular monthly retirement benefits. The DROP funds remain tax-deferred until distributed, providing flexibility in managing your retirement income and tax planning. 

Next Steps 

If you're within two years of DROP eligibility, reach out to Volusia County's Benefits Office about six months before your intended DROP start date to complete the necessary paperwork. This will help you understand the potential financial impact and determine if DROP aligns with your retirement goals. DROP can be a powerful tool for maximizing your retirement benefits, but it requires careful planning and consideration of your individual circumstances.