What happens to benefits for those who move between “appropriated fund” and “non-appropriated fund” positions?
Non-appropriated fund positions are those in which the salaries and benefits are not paid from the Treasury. Most such positions are in self-funding “morale, welfare and recreation” operations at Defense Department bases—such as officers’ and enlisted clubs, post exchanges and recreational facilities—although there are also some in other agencies, primarily the Coast Guard and the Department of Veterans Affairs.

NAF employee benefits, including retirement, health and life insurance coverage, are separate from but largely parallel to those for “appropriated fund” positions. If you transfer between the two systems without a break in service of more than three days, certain protections apply. Check with the personnel office where you would be transferring in for details.