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March 28, 2024

Federal Employee Retirement and Benefits News

Category: Articles

Articles

All the latest articles covering the information that you will be craving to devour will be available via this category. From getting to know how indebted our company is to reading about the presidential elections; from knowing about new retirement plans to finding out how security breaches can affect your life; you can browse it all!

For more articles, visit our articles’ section.

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Open Season and Other Benefits

Enrollment For Federal Employee Benefits

The Thrift Savings Plan (TSP) no longer has an Open Season.  Employees may start, stop or change their TSP contributions or participation in the TSP at any time.

The Fe Federal Employee Benefitsderal Long Term Care Insurance Program (FLTCIP) also does not conduct an annual Open Season.  Employees can apply anytime for FLTCIP.  There is a full-underwriting whenever you make the decision to participate in FLTCIP.  Remember, the cost of long-term care insurance rises with age.  The best time to enroll in a plan is prior to turning 50.

The Federal Employees Group Life Insurance (FEGLI) also does not have an Open Season.  I can only remember two Open Seasons conducted by FEGLI (MetLife).  However, employees may make changes in FEGLI at any time. Coverage can be decreased or waived by completing SF-2817 and forwarding it to your agency Benefits Office.

P. S.  Always Remember to Share What You Know.

Open Season Articles

What is a TransFERS

Time To Gear Up For Open Season

Postal LiteBlue and Open Season

2014 Open Season

What Federal Employees Need Prior to Open Season

Will Insurance Premiums Rise For Federal Employees?

Open Season

PREMIUM RATE CHANGES 2015

Rate changes forRate changes for Federal employees covered by the Federal Employees Health Benefits (FEHB) program according to OPM will increase by approximately 3.2 percent during the 2015 period.  Although premium rates have increased annually over the past four years, the work of OPM has managed to keep those rate increases under 4 percent.

Dental and Vision rates on average will increase by 1.7 percent for dental coverage and 1.5 percent for vision coverage.  Although Federal employees will see an increase, their rates remain amongst the most competitive in the industry due largely to the size of the workforce; but not to dismiss the careful negotiations entered into by OPM to provide high quality benefits with a focus on cost-containment.

Parents have been very concerned about coverage for their sons and daughters between the ages of 22 and 26.  Now via the Affordable Care Act (ACA), these young people are covered expanding protection to over 400,000 young people across the nation.  Parents can rest comfortably in knowing their children’s health will be protected and covered by their Federal health care plans.

With the expansion of ACA, there is greater competition in the industry among carriers resulting in lower costs for entities seeking and relying on their services to offer quality benefits to their employees.  The Office of Personnel Management states that there will be 257 plan choices to include 4 new plan choices for Federal employees in 2015.

Federal employees with a self only option on average will pay $2.93 more bi-weekly and those with family coverage will pay $6.89 more.  Those persons with HMOs will see an average increase of 4 percent and Fee-for-Service plans will see an average increase of 3.1 percent.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

Benefits Specialists / Programs

What Specialists Are Available To Help Federal Employees With Benefit Selections

Benefit SelectionsIndividuals charged with overseeing benefits and helping to organize benefits and health-care fairs receive information needed each year from OPM in order to make Open Season happen in their individual agencies.  These personnel receive from the Office of Health Care and Insurance:
Guides on Rider Information
Information booklets and materials- how to order the materials and distribute them during Open Season.
Information and directions on how to conduct the Open Season both in general and agency specific.
Significant event information is also distributed to agency personnel tasked with conducting the Open Season and
Information impacting specific plans in FEDVIP and FEHB.

Often times employees not tasked with Open Season responsibilities do not appreciate the tremendous amount of time and preparation that goes into making the Open Season happen.  The personnel under the guidance of the Office of Health Care and Insurance must be able to answer a series of questions and inquiries to include contact information about participating carriers.

The Office of Health Care and Insurance provides FastFacts on Federal Benefits and so many other factors relevant to helping Federal employees make wise and cost conscious decisions about what is best for them and their families.

P. S.  Always Remember to Share What You Know.

Open Season Related Articles

What You Can Do In Open Season

Federal employeesOpen Season is an annual event for Federal employees.  During Open Season, employees may do the following:

Enroll in a flexible spending account program (FSAFEDS) which is a health care and/or dependent care account.  Participation in the program requires enrollment each year.  The program does not continue like FEHB and FEGLI without re-enrollment.  The maximum annual election for the Health Care Flexible Spencing Account and the Limited Expense Health Care Flexible Spending Account is $2,500 for 2015.

The maximum annual election for 2015 is $5,000 for a Dependent Care Flexible Spending Account.  Also the minimum election for the flexible spending account has changed from $250 to $100 for 2015.

Employees can also enroll, change, of cancel an existing enrollment in their dental and/or vision plans under FEDVIP.   The same holds true for the health plans under FEHB.  There is no Open Season for life insurance under FEGLI.

P. S.  Always Remember to Share What You Know.

Open Season Articles

What is a TransFERS

Time To Gear Up For Open Season

Postal LiteBlue and Open Season

2014 Open Season

What Federal Employees Need Prior to Open Season

Will Insurance Premiums Rise For Federal Employees?

Open Season

2014 Open Season

2014 Open Season for Federal Employees

Postal employeesActive Federal & Postal employees, retirees and their families should be on the look-out for Open Season which starts Monday, November 10, 2014 and continues through Monday, December 8, 2014.  Open Season allows Federal Employees to make changes and add a qualified family member to their plan among other things.  It is also a time to speak with your carrier and the FEHB representatives in your agency to ask questions and seek counsel about your benefits plan.

The Open Season covers health benefits (FEHB), dental and vision (FEDVIP), the flexible spending account (FSAFEDS).  In order to help the process of choosing a suitable plan for you and your family, OPM has compiled a Summary of Benefits and Coverage (SBC).  The SBC allows employees to make comparisons in costs, coverage, deductibles, co-pays, and out of pocket limits.  The SBC also outlines for employees what services are available and covered and what services are not available and therefore not covered under a particular plan.

OPM offers the SBC for ease of comparison and a short-hand version of the many plans offered to Federal employees.  However, in order to get a more detailed understanding of the plans and what they offer, it is always recommended that employees review and evaluate the plan brochure of the provider they are interested in.

There will most likely be a number of health fairs employees can attend in order to gain additional information.  Also don’t forget about the use of the website to see what your plan covers.  All FEHB plans are on OPM’s website for the convenience of all Federal employees, active and retired.

P. S.  Always Remember to Share What You Know.

Open Season Articles

What is a TransFERS

Time To Gear Up For Open Season

Postal LiteBlue and Open Season

What Federal Employees Need Prior to Open Season

Will Insurance Premiums Rise For Federal Employees?

Open Season

 

NEWSLETTER WEEKLY – TO OUR HEALTH

OUR HEALTHOur conversations are extensive about retirement, how to do it right, when to do it, and what to simply do about it.  All of those concerns are of little consequence if we are not on top of our health.  The amount of resources we have is no substitute for taking care of ourselves.  We need to know our bodies and respond to them when they don’t behave in quite the way we are used to.

It is so important not to ignore warning signs of ill-health or simply needing to get our engines checked.  Not changing the oil in a vehicle is a simple fix if it is attended to early, but can lead to a huge headache if ignored.  Not changing your oil and making certain your vehicle has the lubricants needed at the levels required for efficiency could burn your engine out and cause a serious malfunction.  Trying to fix or replace an engine can be costly and if you don’t have the money to take care of the engine, then your car just might join the many other cars left to rot away at the junk yard.  Perhaps, some of the parts can be used for scrap.

Human beings have engines, perhaps not as simple as cars, but nevertheless, an engine.  We need to make sure our blood pressure is where it needs to be so that there is not damage to our hearts, arteries and so many other physically disabling dynamics.  We need to know what our numbers are.  Are we controlling our cholesterol and eating properly.  Are we getting our kidneys checked.  High-blood pressure is often called the silent killer because many of us have it, display no noticeable symptoms and therefore, don’t know that we have it until we suffer kidney failure and have to be placed on dialysis.

Many Americans suffer from diabetes and may go for years without discovering they have the disease which can lead to loss of vision and dependence on dialysis to filter the blood.  Genetics may cause us to live with a number of ills because it is simply a part of our inherited DNA.  However, Dr. Oz states very emphatically that life-style trumps what have inherited.  Our parents may not have had the facilities and advances in medicine to hold an inherited ill at bay, but changing your life style might make a significant difference in whether you live with health or not.

The Federal Government offers a great package of benefits to its employees, particularly health benefits.  The Federal Employees Health Benefits program is among the best in the nation.  Let your health coverage serve you and your family.  You are paying a part of your health insurance premium cost and the government pays the remaining portion.  Your health insurance is yours and you and your family should use it to ensure your family is healthy.

We cannot begin to look forward to a good retirement no matter the resources, if we are unhealthy, unable to take care of our basic functions and decide our own agenda.  Without good health our retirement future will look fairly bleak.  Retirement is a wonderful place to be if we are collectively wealthy – first our health, second having the necessary financial resources, and third having family and friends around to share in the happiness of many moments to come.    Make sure you are doing a thorough assessment of your benefits now that Open Season is quickly approaching.    If any circumstances in the condition of your health or that of a covered family member has changed, make absolutely sure you are enrolled in a program that will answer your health care needs.  If you have been under the same plan for a long time and it offers exactly what you need and want, then there is no reason to make a change.

If however, that plan is not providing exactly what you and your family need to assure your health, switch to a new plan and hold both your plan and your provider accountable.  Make certain you are partnering with your health care providers to map out exactly what is best in health care treatment for you and your family.  It will be Open Season in a few weeks, get ready for it and get all you need to have a healthy life – starting with prioritizing you.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

WHAT ABOUT MY SOCIAL SECURITY FOR MY FAMILY

SOCIAL SECURITY FOR MY FAMILYWhen an individual passes away who has worked in a Social Security covered employment his/her family members may be eligible to receive benefits based on the age of the person when death occurred.  When a worker is very young and passes away and has worked for at least 1 ½ years during the 3 years prior to the death,  his/her survivors may be eligible for a benefit.

A widow or widower may be entitled to full benefits at full retirement age or reduced benefits at age 60.
Age 50 – a disabled widow or widower.
A widow or widower of any age who has the responsibility of taking care of the deceased employee’s child that is either 16 or disabled and is receiving Social Security benefits.
Disabled children before reaching the age of 22 and who remains disabled.
A divorced spouse under specific circumstances may be eligible.
A dependent parent or parents age 62 or older.
Children that are unmarried and younger than 18 years of age and up to age 19 if the attend elementary or secondary school full time.  Under certain conditions benefits may also be available to stepchildren, adopted children and grandchildren.
Remarriage after age 60, 50 if disabled.

Check with the Social Security Administration if you are ever in doubt as to the kind of benefits you may qualify for.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

DISABILITY AND THE NUMBER OF CREDITS NEEDED

DISABILITYThe number of Social Security credits needed to collect the Social Security benefit differ from the number of credits needed to qualify for disability.  The number of credits needed for disability benefits depends upon your age when you became disabled.  the following credits apply depending on when you became disabled:

-Prior to age 24 – 1  ½  years of work  equivalent to 6 credits in the 3 years prior to your disability.
-Between 24 and 30 years of age you only need credit for  ½ the time between age 21 and the time you became disabled.
-Disability at age 31 or older, 20 credits are needed in the 10 years immediately prior to when you became disabled.

There are always exceptions to every rule and policies and guidelines change.  It is always important to check with Social Security if your disability falls outside of the time frames outlined, as these circumstances only represent the tip of the iceberg.   Social Security will help you iron out any rough spots you might have about your benefits.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

DETERMINATION OF MY SOCIAL SECURITY BENEFITS

SOCIAL SECURITY BENEFITSFederal employees who pay into Social Security and are covered under FERS have 3 components to their retirement benefits plan.  The annuity is calculated based on the FERS annuity formula and the Social Security benefit is a separate calculation.  The TSP portion is based on the employee’s contribution level and matching contribution from the agency.

When the Social Security benefit is calculated your entire work history is evaluated.  Your Social Security benefit is based on your earnings over your entire work career.  Your benefit amount is also dependent on the age you start receiving retirement benefits.  The earlier you start receiving benefits, the lower your payment will be.  Full retirement age is 65 for those born after 1938.  For individuals born between 1943–1954, full retirement age is 66.  The age will gradually increase to 67 for individuals born in 1960 and beyond.  If you delay receiving benefits considerably beyond age 65, your benefit amount will increase by up to 8% per year for each year you delay up to age 70.  The increase will vary according to the year of your birth.  However, most retirement educators agree that there is no real benefit in waiting after age 70 to receive your Social Security benefit.

Just when decide to receive your Social Security is a matter of determining what best fits you and your family needs.  The age of first eligibility for Social Security is 62.  The earlier your received your benefit the less it will be.  However, the amount of your benefit may not be as important as needing the extra money to fill a gap.  On the other hand, your plans and resources might allow you to wait so that the amount you had planned for will be realized.  Retirement and how and when it is done remains a very personal decision unique to each individual’s circumstances.  Plan early to retire well.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

PART-TIMERS AND CALCULATING THE FERS ANNUITY

FERS ANNUITYA question came into my inbox about calculating the annuity for part-time employees.  The calculation of the annuity for part-time employees takes into consideration the high-3 average salary at the full-time rate of pay.  The benefit, however, is based on the full-time rate reduced in accordance with the part-time schedule.  Who is covered under FERS is another consideration because there are exceptions to the FERS automatic coverage of employees hired after December 31, 1983:

                   Employees in temporary appointments of 1 year or less Intermittent Employees Persons not eligible for Social Security coveragePersons with nonfederal service creditable under the Civil Service Retirement System (CSRS) If an employee experiences a break in-service then that determination of CSRS, CSRS Offset or FERS after a break in-service is based on the following:

                   If you were covered under CSRS  without Social Security and left the government for less than a year, you would be reemployed under CSRS coverage.  Although you would be covered under CSRS, you have the option of transferring to FERS whereby you will also be subject to Social Security deductions and coverage.  If you elect to transfer to FERS it must be done within 6 months.

You are automatically covered under FERS if you have less than 5 years under CSRS.Five years or more under CSRS, you would be covered by the CSRS Offset plan(components of both CSRS and Social Security).  The CSRS contributions are reduced by 100 percent  of the Social Security Old-Age, Survivor Disability Insurance (OASDI).

The CSRS benefit will be offset or reduced by any and all Social Security benefits creditedto you during your Federal employment.

                             If you were never covered by CSRS but had 5 years of creditable civilian service prior to January 1, 1987 you are eligible for CSRS Offset coverage.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

DO FEDERAL EMPLOYEES NEED FINANCIAL COUNSELING

BENEFIT RETIREMENTDo kids as young as pre-kindergarten age need to start appropriately learning financial literacy?  Yes they do.  Being financially literate is a very necessary tool to survive in the new, global experience.  There are a number of federal employees who are wise enough to connect with responsible financial counselors and educators.  There is an ever greater number who absolutely never thought about seeking out the services of a financial counselor.

Just as we cannot be all things to all people, we don’t have the skills needed to manage every aspect of our lives.  We go to doctors and other health care providers when we are ill and not at our physical and mental best.  We seek out an attorney when we need legal advice.  Why not seek out a financial counselor when we need to manage, grow and sustain our wealth.  The Federal workforce is the largest in the world making them collectively the wealthiest workforce in the world.  Although Federal employees do not combine their benefits in retirement or operate as a whole, the financial services they need to exist in retirement are the same.

Federal employees need to know how to manage all of their resources.  They need to understand the merit of planning and accountability.  The Federal government represents the interests of all of its employees and their families, estimated at over 10 million.  The government cannot all the time anticipate your individual needs or the needs of your family, but you can.  Federal employees need to partner with responsible financial counselors and educators early long before 5 years prior to retirement.

You don’t have to be an accountant or a financial expert to be financially literate about your future.  Talking to someone who can help you build a plan that will grow as you and your family grow is an important step to securing your future.  Being a Federal employee affords stability and guarantees some of the best benefits on the market.  Why not complete your benefits package by finding a good, responsible financial counselor/educator who can help you be exactly where you want to be in retirement.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

SHOULD FEDERAL EMPLOYEES BE PAID BASED ON PERFORMANCE

BASED ON PERFORMANCEThat seems to be a legitimate question, but one I fail to comprehend.  I thought all employees were paid based on their performance.  Because if they are not paid based on performance, then the converse would be true, they are paid based on non-performance.  When I first heard the statement paid for performance, it was one of the most ridiculous notions I had ever heard of.  Are there actually systems set up in the American workforce where people are getting paid for non-performance?   I don’t have a whole lot to say about those people who might be getting paid for non-performance.  I would rather think they are guided by their integrity and a moral compass.  I believe, like Ann Frank, that all people are good at heart, it just takes some people longer than others to find the goodness in their hearts.

If people are being paid for non-performance then the burden is on management to turn that situation around.  Non-performance is more a factor of management than non-management.  If management is not coaching, monitoring and being what a great supervisor should be then there is anarchy within the ranks, thus a culture of non-performance.  When there are a number of individuals not performing, management needs to be counseled first and then perhaps there might be consideration to form a new management team.  It is the responsibility of management to model high-level performance and to exact accountability.

When a classroom of students fail, it is more about the teacher’s ability to engage students than it is about the students’ ability.  By the same token, poor performers on the job is an indication of management’s inability to manage, guide, direct, motivate, influence and lead.  Everybody should be paid based on performance.  Should I be paid more because I perform better?  Perhaps.  Afterall, people do have different levels of ability.  The notion of addressing pay for performance is not a good strategy or statement.  Everybody should be paid for performance.  Those individuals who perform at an exceptional level, most important ,displaying  the fair and equitable treatment of people should be duly rewarded.

However, when people start to work on any job they are entering into a contractual agreement.  I am to provide said number and quality of tasks for an agreed upon salary and other terms so outlined.  There is not much to be said.  The idea that Federal employees should be paid for performance is nearly insulting.  If you are now going to pay me for performance what were you paying me for all the years of service I put in prior.  The notion also gives the Federal workforce the label of being non-performers.  There are individuals at every level in government and private industry who have not been motivated to do their best.   Supervisors and managers need to put boots on the ground by investing in growing their employees and not destroying them by the inappropriate use of power and labels.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

WILL REFORMING FEDERAL PAY BENEFIT RETIREMENT

FEDERAL PAY BENEFIT RETIREMENTThe Federal Pay Schedule commonly called the General Schedule is over 50 years old.  I personally think a lot of work and integrity went into constructuring a pay system based on a theory of equity.  The GS Schedule has 15 grades ranging from a GS-1 to a GS-15 with ten steps for each grade.  The design was meant to show growth in earnings over a work career of approximately 30 years.  Further, the idea was that you didn’t move or advance too quickly thus feeling as if you were not growing from a financial standpoint.  We would hope there are no GS-1s – GS-4s in the system.

However, when a Federal employee initially comes into service, they start at their grade and a step 1 unless being hired via superior qualifications allowing one to start generally at a step 5.  The growth theory, not including cost-of-living adjustments, was predicated on a work-incentive that over a period of time the salary would grow.  Initial entry at a step 1 and then every year for 3 years there is a step increase.  Therefore after 3 years on the job, the employee would be at a step 4.  After which the number of years it takes to get to the top of the step (10), increases.  The rationale being that by the time you get to the 10th step you would be facing retirement.

If however, you were to be promoted to another grade outside of continuing to grow in the same grade, the increase would be the equivalent of two grades.  For example, GS-12, step 2 being promoted to a GS-13.  Whatever the salary is on the GS-12 level, two steps – a GS-12, step 4 equivalent would be found on the GS-13 level.

Will reforming federal pay benefit retirement?  If the reform increases salaries across the board or provide a mechanism for quicker advancement based on high performance, then the retirement benefit would be impacted.  The annuity is calculated based on the highest earnings over 3 years.  The higher the salary, the higher the annuity calculation thus the greater financial reward in retirement all things being equal.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

IN THE NEWS – COMING OR GOING

Federal employeesIt is so confusing,t where is the logic.  We are talking about the revolving door of Federal employees coming and going.  There are mandates across agencies to reduce the number of Federal employees on the rolls.  Several strategies have been offered from the threat of a RIF (Reduction-in-Force), to offering buy-outs.  The mandate calls for reducing the rolls by 20% across agencies.  If the rolls need to be reduced, then once again why is there the need for Phased Retirement.  If there is a need for employees to leave the Federal service to reduce costs, then why expend the money, time and energy to keep those employees who might be preparing to leave government via Phased Retirement.

Initially, the Federal Government feared  too many employees would retire, leaving gaps in institutional knowledge and a misalignment of staffing.  The Department of Defense has taken the lead in terms of reducing the number of employees on the rolls.  Some agencies are saying that too many employees are retiring and other agencies are saying that too few employees are retiring.  Initially, agencies simply stressed the eligibility for retirement and didn’t get a lot of takers.  Then a $25,000 buyout was offered.  There were some takers but not as many as expected.  The Postal Service is also dealing with how to effectively downsize with Postmasters being the hardest hit.

Many Federal employees eligible for retirement find they cannot retire from an economic perspective.  That position rests with a number of Federal employees perhaps more than we want to imagine.  Employees under the Civil Service Retirement System have a more lucrative pension plan particularly if they work 41 years and 11 months for regular employees.  Special category employees do not have to meet the 41 year, 11 months requirement in order to realize the 80% maximum benefit.  Federal employees would be more willing to retire after reaching the age and service requirements, if the Federal service would take a greater responsibility in helping such a large workforce prepare for retirement.

Times are economically hard for most Americans after teethering on the edge of a depression since 2008.  The downslide probably started somewhere around 2005 and ballooned in 2008. We can see the light at the end of the tunnel and things are imporving, but there remains a steep climb to economic stability for all Americans.ly  However, those Federal employees most likely to encounter not having the kind resources imagined in retirement  will be individuals retiring under the Federal Employees Retirement System.  It is a good step forward that new employees coming into the Federal service are automatically enrolled in the TSP.  The TSP represents the largest component of the Federal Employees Retirement System. Yet, too many employees are not fully participating in the TSP by maximizing contributions.  Education is key to sustaining Federal employees both financially, psychologically and emotionally in retirement.  The employees must be educated about the importance and the urgency of participating in the TSP.  The education must start at the beginning and not 5 years prior to retirement.  If not too late, it is certainly treading dangerous waters.

While it is admittedly never too late to start preparing for your future, it is far more prudent to start early giving employees the opportunity to save more.  The coming and going of Federal employees has to do with planning or the lack thereof for retirement.  It is easier said than done – prepare for retirement, get your house in order.  The average person is so busy just living that what is in the inevitable future is often dismissed as – I will attend to that later.  Unfortunately, later will attend to itself, leaving many of us wondering how we are going to survive an estimated 20-30 years in retirement.

We continue talking about the future of Medicare and Social Security.  Will the programs be around for future generations?  There might be another concern that needs to be addressed and that is how strong will the Medicaid program be.  Will there be enough dollars in Medicaid to take care of the countless number of people who will eventually end up on Medicaid because they cannot afford to pay for the additional services they need in old age, primarily nursing home care?  As a retirement educator, I am passionate about the road ahead because I talk to so many wonderful people who have worked hard and long all of their lives and simply do not have the resources to even think about retirement.

People are busy trying to live, send children to college, help take care of children who cannot find jobs and have returned home with families to the homes of their parents.  The nation is in need of something amazing – EDUCATION about real life and its consequences.  Human Resources professionals need to reassess their roles and responsibilities for preparing the nation’s workforce for retirement.  The task is equally as important as recruitment and hiring and perhaps even more so.  We tend to hire for the most part – young, vibrant and healthy people.  That is the picture we see from the windshield.  The picture we see from the rear-view mirror is quite different – older faces with more measured steps and folks in greater need for health care services.

Human Resources is a service armof an organization and we need to do much more to assist employees be they in the public or private sector.  Human Resources personnel would benefit the entire workforce by becoming more proactive and leading employees through a comprehensive outlook of what the work life cycle really means – from the front door to the last day you answer the call as an employee.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

NEWSLETTER WEEKLY – FIX THE LEO PROBLEM

R PlanThe Federal Retirement Systems are not uniform across unique systems.  All persons under the Civil Service Retirement System (CSRS) are not governed by the same guidelines and the same is true for the Federal Employees Retirement System (FERS).  The Office of Personnel Management (OPM) has been involved in a number of attempts to bring uniformity or standardization to certain job classifications.  While I agree the ambiguity should be taken out of situations where individuals are performing similar jobs, but are treated differently for retirement purposes; most specifically, Law Enforcement Officers.

This category of employees are perhaps the most challenged group as to how they fit into the CSRS and FERS retirement systems.  LEOs are defined one way under CSRS and yet a different way under FERS.  Who fits into those categories is also an aspect requiring much discussion.  Law Enforcement Officers are required to retire from their classification at the age of 57, the age was previously 55.  Due to the early retirement provisions, these employees also pay an extra .5 percent into the CSRS, 7.5% versus 7.0% for regular CSRS employees.  Under FERS, LEOs pay 1.3% into the system as opposed to .8% for regular employees under FERS.  The higher rates are required because of the mandatory early retirement age.  They put in more earlier because they leave the service sooner.  In other words, they have a shorter time period to fund their retirement accounts.

Those distinctions are understandable, but even with those distinctions, every employee who considers him or herself an LEO just might not be for retirement purposes.  That is where the uniformity is needed.  Some legislators have called for giving OPM the opportunity to develop a streamlined system that would virtually integrate the many bifurcated aspects of the rules and guidelines governing retirement provisions for Law Enforcement Offcers.  Perhaps, the definition for law Enforcement Officers either needs to be expanded, narrowed or totally reevaluated.

Law Enforcement Officers provide a very valuable service to the nation.  They should not have to wonder whether they fall under special category for retirement purposes.  Any retirement system should be very clear and unambiguous leaving only a question of when is the best time for me to retire and how will I manage my benefits.  There will always be a number of questions about retirement but none of those questions should revolve around having a misunderstanding of what benefits you are entitled to as a result of your employment.

As the responsibilities and the risks for law enforcement expand since the attacks of 9/11, it is even a greater reason for the issue of who is an LEO to be resolved.  These brave men and women are inundated with the heavy task of protecting citizens, the nation’s borders and the highest office in the land.  Worrying about whether they are covered under special provisions for retirement should be the last thing they have to contend with.  Congress should be urged to give the Office of Personnel Management the latitude needed to integrate terms and policies including an expansion strategy that will uniformly define Law Enforcement Officers and provide them all with the kind of retirement security they deserve.

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

 

 

GROW YOUR BRAIN IN RETIREMENT

GROW YOUR BRAIN IN RETIREMENT
• Take a course at a local Community College, University, or other school

• Read a classic novel that you’ve been afraid to dive into
• Take up chess
• Take up hunting or fishing of hiking or museum hopping-become a docent
• Take a class – of course! – ladies – in auto mechanics
• Write your memoirs
• Learn a foreign language
• Join a community theater group
• Take a class – of course! Gentleman – in interior design
• Join a bird watching club and learn to identify bird species where you live
• Take up line dancing and hand dancing, even try your style at ballroom dancing
• Learn astronomy, buy a telescope and join an amateur organization
• Learn how to rewire an electric outlet
• Learn to figure skate
• Buy a Wii
• Join a Great Books discussion group or start one
• Learn to SCUBA dive
• Take up singing lessons
• Join a competitive bowling league
• Organize a travel team to explore new places and things to see

P. S.  Always Remember to Share What You Know.

Dianna Tafazoli

 

 

Getting In Shape For Retirement

Getting In Shape For Retirement

How you spend your retirement years may have as much to do with your physical plan as your financial

plan.  Here are a few ideas that could help you enjoy your golden years just a bit more.

1. Get A Comprehensive Medical Check-Up

To get an idea of what a comprehensive exam can include, visit the Mayo Clinic’s Executive Health Program, the Duke Executive Health program, or the Johns Hopkins Executive Health Program.

2.  Choose a Fitness Regimen

If you can afford it, consider hiring a personal trainer or hire a personal trainer for your group, even if it’s just for five to ten sessions to get you into the swing of things.

3.  Select Your Anti-Aging Strategies to Live Longer and Look Younger from Head-to-Toe

It’s time to pay attention to nutrition and supplements, weight loss, teeth, eyes, skin and, yes even a makeover if you choose.

4.  Get a Comprehensive Financial Assessment

Play around with many of the financial calculators available online to get an estimate.    Each individual’s situation is different, and our advice is to sit down with all of your information and analyze and decide if you need to speak with a financial planner.

5. Maximize Your Savings

You’ll probably need more money than you think to retire, and you never know ….”things happen”.  It’s never too late to increase your savings.

6. Understand Your Insurance and Benefit Options

Many people ignore this area until it is too late.  Even if you are still in your fifties, start with an understanding of what your Medicare and Social Security benefits will be.

7.  Decide Where You Will Live

This is going to be a big decision, however most people actually stay where they are.

8.  Do a Career Evaluation

Now is the time for a career check-up.  A career evaluation could also be useful if you decide you want to work after retirement.

9. Do a Personal and Relationship Evaluation

Is this the time in your life when you will begin to spend more time with your family?  Are you ready to look inward and decide what you want the rest of your life to be about?

10.  Make Sure Your Parents are Taken Care Of

Baby Boomers are the first generation whose parents may live 20 to 30 years beyond their retirement age.  That adds a whole new level of complexity, cost, and worry for 50-plus adults.

11.  Pick and Prioritize Your Dream Trips

Where do you want to go?  Where should you go before everyone else discovers it?  Is there a place that could be quite different ten years from now that you should consider sooner like the Galapagos or Great Barrier Reef?

12.  Plan Your Leisure Time Lifestyle

Consider what you’ll do when you stop working …. or how to have more fun while you are still working.

13.  Give Something Back

Do you plan to give something back to society through volunteering or mentoring within your area of expertise?

14.  Get Your Estate Planning in Order

Departing this world without having your affairs in order might leave your surviving family members and loved ones in a really bad situation..  Now is the time to ensure you have a solid will, estate plan, and a “living-will.”

15.  Start Taking Advantage of Age-Based Deals (like Medicare)

Many of us don’t want to accept that we are “over 50” or “over 60”.  But there is one big advantage:  Many companies and services offer meaningful discounts to people as young as 50.

P. S.  Always Remember to Share What You Know.

Recommended Articles

For Postal Employees – LiteBlue and the TSP

Federal Retirement Benefit Analysis

The Thrift Savings Plan (TSP)

How Ready Are You For Retirement?

Ready Are You For Retirement?• Have you quantified your financial objectives?  In other words, have you estimated how much money you will need to live the life you desire in retirement?

• Have you saved enough in your TSP Account?

• For Postal Employees – Are your Retirement Elections up to date in LiteBlue?

• Have you set appropriate goals for retirement?

• Do you have doable strategies to achieve those goals?

• Can you itemize the strategies to achieve the goals you have set for retirement?

• Do you know where all your important records are?

• Have you informed someone you trust about your important records?

• Do you have your spending under control and what strategies have you used to control your spending?

• Do you know how you spend every single dollar and cent?

• Do you keep a spending chart so that you can actually determine what you are spending, how you are spending and if changes need to be made?

• Are you saving enough money?

• Have you prepared an estimated retirement budget and devised steps to help you operate within your budget?

• Do you intend to leave a big inheritance to your children, other family members, or a charity?  If so, have you set aside money or made provisions to accomplish that goal?

• Have you thought about where you will live in retirement and the cost involved?

• What would you do in the event of an unexpected and extended disability before you retire?

• Do you have an emergency fund?

• If you are a couple, are both parties completely aware of the status of the financial situation?

• If something happens to either of the parties,  is each member capable of managing the family’s finances independently?

• Are you taking full and total advantage of any tax-deferred savings options offered by your employer?

• If you have dependents that rely on your income for survival, what plans have you put in place in the event of your death?

• Are you taking care of your health so that you can have a good quality of life in your retirement years?
There are many more retirement readiness questions we could pose, but I think we have sufficient fuel to allow us to take a good look at our readiness for retirement.   Remember if you have not done any of the things listed, it’s ok, you need only make them a part of your individual action plan and get started activating that plan as part of your goal to Retire Well.

P.S.  Always Remember to Share What You Know.

Dianna Tafazoli

RELATED TSP ARTICLES

Thrift Savings Plan (TSP) Withdrawal Options

For Postal Employees – LiteBlue and the TSP

Federal and Postal Employees – Choosing a Financial Professional

The Thrift Savings Plan (TSP)

Is All ‘Your’ TSP Money Actually Yours?

Federal Retirement Benefit Analysis

How To Best Fund Your TSP

Receive a Passing Grade For Retirement

Federal and Postal Employee Retirement Planning Report Card

Passing Grade For Retirement

Each of us should have a Retirement Planning Report Card with the expectation of doing well pretty much like when we were kids in school.  If you got good grades, your parents often rewarded you with something special, sometimes even money to show the value and significance of getting good grades.
Now we have reached another milestone in our lives where once again a report card is important.  The difference is if you get a good report card by planning ahead for retirement, your reward is to live in comfort and security.  Proper planning allows you to retire on your own terms and take the worry out of how you are going to survive now that your income is much lower than it was as an active employee.
Your planning report card should include estimates of your federal retirement annuity income which will resemble reality the closer you get to retirement.  It should also include life expectancy to help you get an idea of how long your resources need to last.  Actuary charts and estimates can help you with this endeavor.  Look to include your total estimated monthly retirement income and your estimated monthly expenses.  Do not forget to include your Social Security benefits and other items you think relevant to giving you the best  picture possible of your retirement future.

There is quite a bit of work to do to get ready for retirement, but the sooner you get started the closer you are to reaching your retirement goals.

P. S. Always Remember to Share What You Know.

Postal Employees Should View LiteBlue Related Pages

What Is LiteBlue?

LiteBlue; Online Access to More Than Just Your USPS Earnings Statement

PostalEase / LiteBlue

What Postal Employees Should Do On LiteBlue Before Retirement

Changing Your LiteBlue / PostalEase Password Through ssp.USPS.gov

eRetire for Postal Employees – Retirement Applications on LiteBlue

Living Trusts for Federal Employees

Living Trusts for Federal Employees

Living trusts were generally thought of until about 20 years ago as a planning tool for the rich.  That is no longer the case as these planning tools are becoming more popular with the tax advantages offered and the privacy provided.  Living Trusts are generally set up by an estate attorney while you are alive.  Testamentary trusts are created after death.

Features of a Living Trust

• The Living Trust involves the individual (or a couple if you are married) who secures the Trust and is designated the Grantor or the Trustor.
• The Trustee is the individual named by the Trust as the manager or the Trust’s assets and property.  The Trustee and Grantor may be the same individual or individuals.
• The third party is the Beneficiary(s).  The beneficiaries are the heirs that will receive the fruits of the Trust once the Grantors are deceased.
• Living Trusts are not subject to the laws and regulations of probate.  Therefore your wishes can be kept completely private and away from public scrutiny.
• Since a Trust is defined as a separate legal entity, distributions to beneficiaries can be made from the Trustee without any involvement from the courts.
• The lengthy wait and cost of probate is avoided with a Living Trust.
• Distributions can be made to beneficiaries as long as the assets have been placed in the Trust.
• Once a Living Trust is established there are few limitations, if any, about what can be placed in the trust, i.e., savings accounts, stocks and bonds, real estate, life insurance, personal property.  The assets are changed from your name to the name of the Trust.
• Do your homework and find out more about Living Trusts to determine if it is an estate planning tool that might interest you.

P. S.  Always Remember to Share What You Know.

Recommended Articles

For Postal Employees – LiteBlue and the TSP

Federal Retirement Benefit Analysis

The Thrift Savings Plan (TSP)

Is The Pension Survivor Benefit Best For You?  by Todd Carmack

A Little-Known Opportunity Can Increase Your Retirement Income.  by Mark Sprague

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