thrift savings plan

The Thrift Savings Plan is one of the most important parts of a Federal Employee’s retirement plan. The Thrift Savings Plan is similar to a 401(k) plan offered to Private Market employees and has very similar rules and regulations. An Advantage of the Thrift Savings Plan is the automatic contributions that FERS eligible employees receive along with the relatively inexpensive average internal expense ratio that is charged to Federal Employees on TSP Fund investments.

How to Choose an Indexed Annuity that is Right for You

April 20, 2024 /by aaron steele

Retirement planning options abound, from indexed annuities, IRAs, and employer-sponsored retirement plans. But what exactly are indexed annuities, and how do they operate?

Indexed annuities are financial agreements with insurance firms, often known as equity-indexed or fixed-indexed annuities. These contracts allow investors to earn interest on the market index’s performance. These annuities can produce substantial returns, but there are also certain drawbacks.

Advantages of indexed annuities

Market-linked, fixed growth: Indexed annuities could provide a guaranteed minimum interest rate. Some investment techniques offer growth potential over the required rate since they are linked to stock market indices.

Access to money: You might be able to receive up to 10% of the value of the contract every year from an indexed annuity without paying surrender fees. However, unused funds under this clause may not be carried over to the following year.

Options for income selection: Payouts from annuities might be guaranteed for life or for a specific period. Additionally, if you pass away during the guaranteed period of your lifetime coverage, payments will still be made to your beneficiary.

Minimal return promise: Your indexed annuity’s issuing company might guarantee a certain minimum return even if the underlying index experiences a loss. For instance, even if the risk associated with it has a negative return, it can still pay out 2%.

Offer potential return that is higher than CDs: Indexed annuities have the potential to provide a greater return than certificates of deposit (CDs) and, unlike CDs, have the extra advantage of getting the taxes on earned interest postponed.

Delay paying taxes: As long as you don’t take money out of an annuity before you turn 59 and a half, all of them offer delayed taxes on your earnings. This enables growth that is tax-free and has higher interest earnings.

Option for lifetime income: The fear of outliving one’s assets and income is one of the main concerns among retirees. You can ensure a minimum annual return of 5% and a maximum annual return of 10% for the next 10-15 years by including a lifetime income rider in your indexed annuity contract.

Disadvantages of indexed annuities

It’s complex: Indexed annuities are a complex alternative for retirement income since they are linked to changing market indices and might have intricate contracts and restrictions. You’ll probably need to do your own research to ensure you’re getting the best deal.

Unpredictable: Indexed annuities can produce erratic returns because they eventually depend on the success of a market index, just like the stock market to which they are linked. You can end up with less money than you would have with a more secure or guaranteed retirement choice during a terrible market year or run of years.

Non-liquid: Although it’s not ideal, sometimes you must take money out of your retirement plans because life happens. While you can always take money out of your account, doing so will incur taxes and possibly a penalty of up to 7%.

Federal penalties on withdrawals before the age of 59: A federal tax penalty of 10% applies if money is removed from an indexed annuity before reaching age 59, just like it does for other annuities. Check your contract carefully because some won’t credit all or all of the interest if you withdraw money before the period has ended.

Who is an annuity suitable for?

Indexed annuities are the best option for anyone who wants to engage in the stock market but is concerned about losses. With all these contracts, you can benefit from some economic upside without worrying about a negative downturn.

Additionally, indexed annuities are a superior option for medium and long-term savings objectives. Investors can wait out a little market decline and subsequently benefit from better long-term index gains.

You might be best off with something that provides a higher level of guaranteed return, such as a fixed annuity or a CD, for short-term objectives or situations where you need some profits over the next several years. On the other hand, you may earn even more with a managed fund or a direct investment inside the stock market if you want the biggest return possible and don’t mind taking on additional risk.

Contact Information:
Email: [email protected]
Phone: 3604642979

Bio:
After entering the financial services industry in 1994, it was a desire to guide people towards their financial independence that drove Aaron to start Steele Capital Management in 2013. Armed with an extensive background in financial planning and commercial banking coupled with a sincere passion for helping people, Aaron has the expertise and affinity for serving the unique needs of those in transition. Clients benefit from his objective financial solutions and education aligned solely with
helping them pursue the most comfortable financial life possible.

Born in Olympia, Washington, Aaron spent much of his childhood in Denver, Colorado. An area outside of Phoenix, Arizona, known as the East Valley, occupies a special place in Aaron’s heart. It is where he graduated from Arizona State University with a Bachelor of Science degree in Business Administration, started a family, and advanced his professional career.

Having now returned to his hometown of Olympia, and with the days of coaching his sons football and baseball teams behind him, he now has time to pursue his civic passions. Aaron is proud to serve on the Board of Regents Leadership for Thurston County as the Secretary and Treasurer for the Morningside area. His past affiliations include the West Olympia Rotary and has served on various committees for organizations throughout his community.

Aaron and his beautiful wife, Holly, a Registered Nurse, consider their greatest accomplishment having raised Thomas and Tate, their two intelligent and motivated sons. Their oldest son Tate is following in his father’s entrepreneurial footsteps and currently attends the Carson College of Business at Washington State University. Their beloved youngest son, Thomas, is a student at Olympia High School.

Focused on helping veterans and their families navigate the maze of long-term care solutions, Aaron specializes in customized strategies to avoid the financial crisis that care related expenses can create. Experience has shown him that many seniors are not prepared for the economic transition that takes place as they reach an advanced age.

With support from the American Academy of Benefit Planners – an organization with expertise and resources on the intricacies of government benefits – he helps clients close the gap between the cost of care and their income while protecting their assets from depletion.

Aaron can help you and your family to create, preserve and protect your legacy.

That’s making a difference.

Disclosure:
Investment advisory services are offered through BWM Advisory, LLC (BWM). BWM is registered as an Investment Advisor located in Scottsdale, Arizona, and only conducts business in states where it is properly licensed, notice has been filed, or is excluded from notice filing requirements. This information is not a complete analysis of the topic(s) discussed, is general in nature, and is not personalized investment advice. Nothing in this article is intended to be investment advice. There are risks involved with investing which may include (but are not limited to) market fluctuations and possible loss of principal value. Carefully consider the risks and possible consequences involved prior to making any investment decision. You should consult a professional tax or investment advisor regarding tax and investment implications before taking any investment actions or implementing any investment strategies.

TSP Name Change: What’s The Difference?

April 15, 2024 /by marvin dutton

Shakespeare’s tragic play Romeo and Juliet features a line from Juliet Capulet asking, “What’s in a name?” (Act II, Scene II). What we refer to as a rose could just as quickly be called something else and still have the same pleasant aroma. In Act I of their new comedy show, “The Latest TSP Changes,” the TSP appeared to pose the same question more than once.

What exactly is meant by the term “contribution allocation”? Even though we call it an “investment election.”

Investment elections designate where your TSP contributions will go after you receive them. Your investment preference will apply to all future deposits your account makes. Your investment decision will not affect funds already in your account. Your investment decision will be valid until you create a new one. In some publications, the TSP refers to this action as a “contribution election,” which sounds like a combination of contribution allocation and investment election.

What exactly is meant by the term “interfund transfer?” Whatever we call “reallocation” or “fund transfer,” it will still be crystal clear what you want to do with the money already invested in your TSP.

Reallocation and transfer of fund

The difference between a reallocation and a transfer of funds might interest some people. With a fund transfer, you can move money within your account from one designated fund to another designated fund (or funds) without affecting any other funds. A fund transfer is a method for transferring money into or out of a mutual fund account. This does not affect the other funds in your account.

When you reallocate, the money in your account is moved between the TSP investment funds. When you reallocate, you decide how much of your money you want to put into each fund. You can’t transfer money between funds from one source to another. For example, if you have both traditional (including tax-free) and Roth money in your account, your reallocation will move a certain amount from each type of money into the funds you choose.

It tells us they’re the same thing, but the TSP seems to believe there’s enough difference to warrant two new terms. Why use one term (fund reallocation) when you can use both (fund transfer and interfund transfer)?

Even though they now go by different terms, reallocations and fund transfers are still bound by the same restrictions applied to interfund transfers. Each calendar month, you can use your first two reallocations or fund transfers to move money from one TSP fund to another. After the first two of either type, you can only move money into the G Fund for the rest of the month. Each account has its rules if you have both a civilian account and a uniformed services account.

You should download a copy of the Summary of the Thrift Savings Plan for yourself if you’re interested in understanding how the TSP functions in light of the most recent changes. It was updated in May 2022 and now contains information on the mutual fund window and other changes to the TSP.

Contact Information:
Email: [email protected]
Phone: 2129517376

Bio:
M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected].

More Assistance Is Coming for Feds Having TSP Transition Issues and Flood Victims

April 5, 2024 /by kevin wirth

Participants in the federal government’s 401(k)-style retirement savings program have had a difficult month. In addition to suffering losses in the financial markets, they also experienced issues with the June 1 switch to a new recordkeeper.

According to Kim Weaver, Director of External Affairs for the Federal Retirement Thrift Investment Board, a high frequency of calls to the Thrift Savings Plan‘s Thrift Line has continued for more than a month following the switch. The workforce at the hotline will have nearly quadrupled by Friday, going from 485 on June 1 to a projected 955, which is fantastic news for participants attempting to get through to a representative who can answer their inquiries (there were already 805 contact center representatives as of June 21).

Weaver forewarned that the recently hired agents would need some time to get trained before taking their first call. Although the new recordkeeper offers several advantages, like a safer login process and access to 5,000 mutual funds, many participants first encountered difficulties with the fundamental actions required to utilize these features, such as setting up their accounts.

Weaver noted that the TSP executive director has promised to provide weekly updates on the recordkeeper transition to Del. Eleanor Holmes Norton, D-D.C., and will provide ad hoc updates to any concerned lawmakers.

Norton stated that she was “pleased Director [Ravindra] Deo accepted my request to be issued weekly updates.” She went on to say, “The new system continues to cause my constituents, federal employees, and retirees around the nation significant problems, including taxes being wrongfully deducted from accounts, inaccurate beneficiary information, and inability to access their retirement assets.”

Weaver reported that 1.2 million different TSP participants had used the new system since it launched on June 1. In a typical year, almost 3.3 million participants – or half of all participants – log onto My Account.

An Expansion of the COVID Response’s Special Hiring Regulations

On June 27, the Office of Personnel Management expanded the use of special hiring privileges to aid in recruiting personnel for the federal response to the COVID-19 epidemic. According to the email sent to agency heads by OPM Director Kiran Ahuja, hiring officials may still use the Schedule A recruiting power for excepted services to fill temporary positions directly relevant to the pandemic up to March 1, 2023.

Schedule A enables agencies to forego traditional competitive hiring processes to discover candidates more quickly and effectively. For instance, organizations are not required to make the position public on USAJobs.gov (though they can still do so if they would like).

To fulfill their missions and/or to fill open positions, agencies currently “continue to need more tools to perform strategic, targeted hiring for specific, short-term tasks,” Ahuja stated. According to OPM, “Agencies have ongoing obligations directly tied to the COVID-19 epidemic. Hence the continuous exercise of this extraordinary power is justified.”

Specific hiring regulations apply for temporary appointments lasting up to a year in positions directly related to the COVID-19 response. Hires made before the deadline may be kept on for an additional year.

Assistance for Flood Victims

To assist federal workers and their families impacted by the catastrophic storms and flooding in Montana, OPM has created a leave donation program. In June, major floods brought on by heavy rain and melting snow affected Yellowstone National Park and the surrounding areas, necessitating rescue efforts, evacuations, and closures.

Through the emergency leave transfer program, flood victims in Montana’s Carbon, Park, and Stillwater counties can take extended time off to recover from floods that occurred on June 10 or later without using up any of their own paid leave. If an agency had staff members impacted by the storms and flooding, OPM left it up to the individual agencies to determine their needs and set up contribution programs.

The July 1 memo from Ahuja to agency heads stated, “Agencies with employees affected by the disaster are in the best position to determine whether and how much donated their employees need annual leave, and which of their employees have been adversely affected by the specific emergency within the meaning of OPM regulations.” Additionally, they are best positioned to promptly arrange the transfer of donated annual leave inside their agencies.

If officials don’t have enough donated leave on hand to meet their needs, they can potentially ask other federal agencies for assistance.

If an employee wants to contribute time off, they should speak with their agency rather than OPM, and if they need assistance, they should write to their agencies.

Contact Information:
Email: [email protected]
Phone: 9143022300

Bio:
My name is Kevin Wirth and I have worked in the financial services industry for many years and I specialize in life insurance and retirement planning for individuals and small business owners, with a specialty in working with Federal Employees. I am also AHIP certified to work with individuals on their Medicare planning. You can contact me by e-mail or phone. I look forward to the opportunity of working with you on these most relevant areas of financial planning.

[email protected]
914-302-2300

Disclosure:
These articles are intended for educational purposes only. Please contact your advisors for legal, accounting or investment advice.

Essential Things to Think About for Life and Long-Term Care Insurance (FEGLI and FLTCIP)

March 21, 2024 /by marvin dutton

The Federal Employee Group Life Insurance program, or FEGLI, is one of the many FERS benefits available to federal employees. You can get group life insurance while you’re employed, and under some circumstances, you might be able to keep using it after you retire.

Young federal employees are urged to get life insurance via FEGLI if needed, especially if they have a family or would leave someone else to care for if they pass away. The amount of insurance you require varies based on several factors, but FEGLI is affordable and can typically be afforded at the highest level when younger. FEGLI becomes more expensive as you age and may no longer be affordable, especially if your retirement plan predicts that you’ll also need long-term care insurance coverage.

The Importance of Life Insurance

Both young and old may find life insurance to be helpful. The most common life insurance application is to replace lost income while working. FEGLI is the most affordable option for meeting this demand while employed. Term insurance offers the next best instant price.

It’s crucial to remember that there are various schools of thought regarding the appropriate amount of life insurance. What would you wish you had done to support your family after you passed away? Replacing the financial resources you would have otherwise contributed is one straightforward solution. Many people want to use their early death to pay off their home and their children’s college loans.

Another way to look at it is to ensure that the current objectives are still reachable for those you leave behind.

Your FERS pension is secure as a qualified federal employee up until the time of your passing. Your surviving spouse could receive up to 50% of your FERS annuity if you chose the survivorship benefit. Over time, that loss can become substantial, reducing one of your Social Security benefits, particularly if one spouse passes away significantly sooner than the other.

Term insurance provides life insurance for a set amount of time (term). This can often be purchased in 5-year installments between five and 30 years. Utilizing this to cover a particular risk at certain points in your life is preferable. If both of you pass away or just one of you, things like having money set aside for mortgage payments, student loans, preschool, college, weddings, etc., would be helpful.

Renewing is pricey beyond your “term.” Insurance companies may occasionally allow holders of term policies to upgrade to a permanent policy at the age they reach without undergoing additional medical testing. Your advanced age may significantly raise the expense of waiting. Furthermore, the policy you would select today and the policy that would be presented to you upon conversion might not be the same.

Considering Long-Term Care Insurance

One vital thing to remember is that neither the FEHB nor Medicare will pay for lengthy long-term care requirements. A Medicare component covers the initial few months of an event, but any expenditures incurred beyond that are your own.

Long-term care events often last two to three years. At this point, you may need to live in an assisted living or skilled nursing facility, or you may need assistance from caregivers who visit your home. The duration of long-term care events has occasionally increased to five or six years due to advancements in medical care.

A long-term care event may be self-insurable for some families with no problem. These prices may vary significantly depending on where you live and the type of service you receive.

FLTCIP first seems to be a reasonable purchase, but its price gradually rises over time.

The Premium Stabilization Feature (PSF) of FLTCIP is one great advantage. These conventional long-term care insurance policies typically have prohibitive costs as you get older. Due to the expense, many families renounce their insurance just as their children reach the age when they most need it. Long-term care insurance costs typically increase dramatically over time, but not when they are included in specific insurance policies. The PSF for FLTCIP is determined by taking a percentage of the premiums paid for the FLTCIP 3.0 group policy.

The PSF amount may reduce your future premiums or result in a premium death benefit reimbursement. If you haven’t opted out, are 85 years old or older, and have participated in FLTCIP 3.0 for at least ten years, you are eligible for this. Additionally, you need to have enough PSF to cover 50% of your monthly premiums for the upcoming 12 months or longer. The premium refund death benefit is calculated based on your coverage at the time of your death. The remainder would go to your beneficiary.

Insurance prices may be less high the earlier you plan and get the coverage you require. But this does not imply that you should buy insurance right now. It involves attention, study, and must-have features that suit your needs, just like purchasing a car.

Similar to purchasing a car, if you’re not diligent, insurance too might have a lot of unnecessary and hidden charges. Certain carriers specialize in various types of insurance. Some have ideas that work well in one area but poorly in another. As your future is at stake, be sure your advisors are having these crucial conversations with you.

Contact Information:
Email: [email protected]
Phone: 2129517376

Helping a College Graduate Prepare for Retirement is the Best Gift You Can Give Them

March 20, 2024 /by aaron steele

Recent college graduates are met with severe economic headwinds in the form of rising rent, escalating student debt, and general inflation. The advice that young people should “save early and save often” is given so often that it may seem hard to follow. Despite this, it is essential to emphasize the benefits of doing so for those who can secretly save some money.

Regret is often cited as one of the most convincing reasons. That is, by other people. According to a poll by Magnify Money, over 70% of members of Generation Z and 77% of millennials said they wish they had started investing earlier.

The median amount in retirement accounts for people with all income levels is around $15,000. The tidal wave of national sorrow should not come as a surprise, given that 90% of wage workers across all age groups are not on pace to retire comfortably. It is when it is too late that one realizes the strength of compound interest, which is the most powerful law in the whole economic world.

Consider the following: According to the research conducted by the consulting firm Aon, by the age of 35, you should have saved twice as much for retirement as your yearly wage, and by the age of 45, four times as much, seven times as much, and 11 times as much by the age of 67. This indicates that a person who is 45 years old and earns $100,000 per year ought to have $400,000 in retirement savings. In comparison, a person who is 67 years old and makes the same amount needs $1.1 million in retirement savings to supplement their Social Security benefits and maintain the same standard of living until death.

The most basic calculations tell us that beginning to save at a younger age will involve the fewest sacrifices on our part. Because you have a head start, the early portion of that $1.1 million comes from investment profits rather than your earnings. The sooner you start saving, the more work will be done for you by the financial markets.

A 25-year-old individual who earns an average salary must set aside 16% of their annual income to have the appropriate amount in their retirement account when they are 67. When this individual is 35 years old, they will need to set aside 25% of take-home income; if they are 50 years old, they will need to set aside 50% of their earnings.

The average beginning wage for a recent college graduate is around $55,000. However, if Social Security, taxes, and healthcare costs are included, take-home income is closer to $40,000, equivalent to $3,300 per month. If you make more than $55,000 per year, saving $800 for retirement (about 16% of your monthly earnings) plus $250 for a condo (if you’re attempting to cobble together a down payment of roughly $40,000 in 10 years) on top of that is practically impossible.

However, if the new graduate’s company pays $400 of the goal of $800 to a 401(k)-type plan, and the worker’s contribution of $400 comes before tax, then the new graduate’s net take-home pay would be $300 less while they are still saving $800 a month for retirement.

Unfortunately, most employees under 40 do not participate in a retirement plan. It is quite evident that we need a national retirement system and a solution to the spiraling expenses of higher education.

Even though retirement seems so very far away, there are a few things that a young graduate may do to assist in preparing for it in the interim. These items can help prepare for retirement. First, whether you are a recent college graduate’s parent, relative, or friend, remember that a monetary present is always appreciated. Still, a session with a reputable financial consultant can be an even better gift for them.

Here is how to locate an advisor that you can trust. Significant life events, such as high school graduation, a wedding, or the birth of a child, may serve as a springboard for daydreaming about the future. If the preparation is successful, it will cost a lot less than coping with regret at age 50 and being on the verge of poverty when you are 67.

For graduates, the best way to prevent regret in the future is to start keeping track of the money spent on fleeting pleasures right now. Instead, try the slow-building process of saving $100 per month in an emergency fund in case of unexpected expenses. To fulfill the criteria for the personal finance merit badge for the Boy Scouts, you will need to keep track of your spending for three months and create short-, medium-, and long-term objectives.

Typically, regret is caused by the advertising’s primary source of revenue, which is your impulses. Even if it often precedes the second human need, which is to live a life free from regret in old age, I do not criticize the human impulse to strive for social position and comfort with automobiles, clothing, and homes. However, you should be aware of consumption urges and how they seldom lead to a state of satisfaction. Employing self-psychology to save as much as you can as early as possible serves you well until we have a better system for retirement savings.

Contact Information:
Email: [email protected]
Phone: 3604642979

Aaron can help you and your family to create, preserve and protect your legacy.

That’s making a difference.

6 Social Security Facts Every Woman Should Know

March 15, 2024 /by marvin dutton

Social Security is a significant source of retirement income, particularly for women. But how well do you comprehend the advantages you are entitled to? Here’s what you should know about social security for women.

1. Women in retirement face more financial difficulties than males.

Although women rely on Social Security more than men, their payouts are usually less. After all, you earn more Social Security credits and receive larger benefits if you work more and pay more taxes. According to the Social Security Administration, women often live longer but earn smaller pensions and have fewer assets than men.

Women should make sensible investments and be aware of the Social Security benefits to which they are entitled if they want to avoid financial difficulties in retirement.

2. You can begin receiving partial benefits at age 62.

The Social Security Administration (SSA) states that you can begin collecting partial benefits at age 62 if you have been employed and paid Social Security taxes for at least ten years and have accrued at least forty work credits.

You will receive all your legally due benefits if you wait until you reach full retirement age.

Depending on your birth year, the SSA defines “full retirement age” as being between 66 and 67. Locate the chart on page 7 of SSA Publication 05-10024 to know your exact full retirement age.

3. Marital Status Doesn’t Limit Social Security Benefits

According to Christopher Liew, CFA charter holder and creator of Wealthawesome.com, you and your spouse can apply for Social Security benefits independently and individually. However, you both must have prior employment history and separate service records.

That implies that your combined retirement benefits should automatically exceed $3,500 per month if you have a claim for $2,000 per month and your spouse has a claim for $1,500 per month. You are not just allowed to receive 50% of your spouse’s pension, which is surprising.

4. You are often paid a higher rate if you are eligible for two benefits.

If you’re married, you might qualify for a portion of your spouse’s Social Security payment, ranging from one-third to one-half. Women with a spotty job history will find this helpful.

You’ll likely get the benefit with the highest rate, though, and not both. Because of this, most working women in retirement receive their own Social Security pension rather than their husbands.

The higher your spousal Social Security benefit or your own Social Security benefit will be paid to you as a spouse.

5. Working While Retired Can Reduce Social Security Benefits

You become eligible for a portion of your Social Security benefits when you turn 62. But if you choose to continue working while getting those benefits, the Social Security Administration will lower your payouts by $1 for each $2 you make over the yearly cap, which is $19,560 in 2022.

The Social Security Administration (SSA) will only lower your benefits by $1 for every $3 you earn beyond the yearly cap ($51,960 in 2022) if you continue to work in the year you reach full retirement age. Your benefits won’t be cut in this way after you hit FRA.

6. Widows are Entitled to Social Security Benefits From Their Spouse

A widow may be eligible for 71% of her deceased spouse’s benefits at age 60. Once a widow reaches the full retirement age, this percentage increases to 100%.

The SSA might be able to provide you with a lump sum payment of $255 if you were cohabitating with your spouse at the time of their death.

7. You May Still Be Eligible for Your Ex’s Benefits If You’re Divorced

You might believe that once you get divorced, all of the financial advantages of marriage are lost. But it doesn’t usually work that way when it comes to Social Security.

If you are currently single and your ex-spouse was married for at least ten years, you might be eligible to file for benefits depending on their employment. (This does not reduce the advantages they get.)

Just make sure that neither of you was married to anybody else when you were eligible for Social Security pension benefits. Your ex-service spouse’s history will determine how much of a Social Security pension you can receive.

During the divorce process, some women might consent to waiving their claim to their ex-spouse’s social security benefits. But the SSA hardly ever carries out these orders.

If you are aged 60 or older, and your ex-spouse has passed away, and you want to know your exact full retirement age, you are still eligible to receive benefits based on their job (or 50 if you have a disability).

Contact Information:
Email: [email protected]
Phone: 2129517376

What You Should Know About DoD Civilian retirement

March 14, 2024 /by aaron steele

Federal employees, who work alongside active-duty personnel to keep the mission going, eventually reach the age where they can retire. But it’s critical to ensure that a worker is physically, financially, and intellectually prepared to retire.

The Office of Personnel Management‘s (OPM) website includes resources and tools for potential retirees on the three components of financial retirement planning: Social Security, government pensions, and the Thrift Savings Plan (TSP).

The Benefits and Entitlements Service Team (BEST) manages Offutt’s civilian retirement program. BEST is in charge of providing customer service and up-to-date benefits information to Air Force civilian workers.

BEST’s customer service section advises persons considering retirement to know how many years of service they have, how many years of creditable civilian service they have, and their minimum age and years criteria. Those who retire before the required number of years and at the required age may be penalized.

Due to the large number of retirement claims submitted in 2021, processing times were delayed. People can apply for retirement six months before the proposed retirement date and 60 days before the requested retirement date. The retirement application can be completed in 30 days if there are no problems.

BEST advises maintaining a copy of all submitted documents. While their office can answer broad inquiries about the retirement process, they will refer them to a counselor if a caller requires assistance with the whole application.

According to a BEST representative, the regular leave will be paid directly to the employee, and sick leave will be added to your credited time in service in one-month increments. She advised employees to save for a few pay weeks if the initial retirement payout is delayed due to processing issues.

Remember that federal taxes will be deducted automatically from your retirement pay, and state taxes will vary depending on where you retire.

Because the retirement dashboard is tailored to the employee’s job profile, BEST advises using the Government Retirement and Benefits Platform. The site has a wealth of information, and employees can also request precise projections of their expected annuity and premium deductions.

The GRB Platform gives you the tools you need to change your perks and other information. It connects to personnel and payroll systems, online benefits enrollments and updates, and online retirement applications. Health and life insurance, social security, the Thrift Savings Plan, long-term care insurance, flexible spending accounts, retirement, and workers’ compensation are all covered.

The GRB Platform can also calculate an estimated Federal Employees Retirement System (FERS) retirement salary, which can be factored into future planning. Other items to think about and plan for include life and medical insurance and when to collect Social Security.

Contact Information:
Email: [email protected]
Phone: 3604642979

Aaron can help you and your family to create, preserve and protect your legacy.

That’s making a difference.

The Increase of Fed Rate Might Encourage Floating Rate Annuities

March 13, 2024 /by rick viader

The Federal Reserve Board goes to great lengths to raise interest rates by 0.75 percent on average, and American life and annuity companies are attempting to be courteous about that now.

In the same way, the Federal Reserve raised its target range for the rates of federal funds. However, these are the rates at which the bank advances reserves to one another nightly, on Wednesday from 0.75% to 1% to 1.5% to 1.75%.

Also, because an annuity delivers a guaranteed minimum interest rate, Security Benefit may refer to it as a fixed or non-variable annuity. For instance, a rate sheet that became effective on Monday states that the set income interest rate is 1%. Equally important, on even a 5-year agreement, the firm offers a higher base rate with a 1.6% guarantee duration.

We can say that the floating-rate addition is also available with the product, and its value is based on how the three-month Chicago Mercantile Exchange Term Secured Overnight Financing Rate (SOFR) reference rate performs. Moreover, according to Security Concern, the current rate of 1.43% SOFR increase will raise the overall awarded interest rate to 3.03% in the agreement’s first year. In the same way, the annual maximum interest rate will indeed be 5.1%.

In addition to the above content and by offering brief annuities or using a “laddering” technique, in which new annuities are financed with certain sums of money at predetermined intervals, other businesses may assist customers in managing interest rate unpredictability. This strategy results in average annuity portfolio crediting rates that progressively increase while increasing interest rates and slowly decline during periods of dropping rates.

The Look for New Concepts

According to a recent remark by Security Benefit’s head of distribution, David Byrnes, recent Fed rate rises may prompt customers to explore other bonds. However, buyers are bracing themselves for further volatility, according to Byrnes. “The bond’s poor record in the stock market in the recent year, mediocre profits in Q1, increased worries, and future predicted percentage raises the contribution in the atmosphere,” he said.

He noted that searching for solutions that can protect principles when interest rates climb may be advantageous for floating-rate annuities. Also, by limiting the amount of currency that individuals and businesses may use to make purchases, the action aims to lower inflation.

Rising interest rates may benefit or harm life and annuity issuers differently. They may also bring attention to the products like non-variable annuities with floating interest rates created for times of interest rate volatility.

The Sense

Adding some essential points to the above content, we can say that financial services organizations can start wanting to provide their customers items with alluring advantages instead of merely doing so out of politeness.

The Whole Image

Customers may be tempted to move money out of annuities that are fixed and fixed cash-value life protection into alternative “currency saving” products if banks raise the rates on certificates of deposit and money market fund rates to rise. In the same way, higher rates could also have a negative impact on the sales of the mutual fund affiliates of life insurers, earning based on the assets process of a variable annuity. However, rising rates may also cause the billions in bonds in life insurers’

In addition to the above content and for the brokers within the significant fixed insurance of life, fixed annuity, longstanding incapacity protection, and the other protection and insurance process for a long life, bond yield hikes may be very beneficial.

Menus of Products

Equally important, the product menus of life insurance companies are also being examined to determine what choices are currently available for customers searching for solutions to deal with increasing interest rates or interest rate ambiguity. For instance, Security Benefit cites the Rate Track Annuity contract as something it currently provides. This is known as a single annuity premium or a deferral annuity that helps you pay a greater total rate while interest rates rise.

Contact Information:
Email: [email protected]
Phone: 9568933225

Bio:
Rick Viader is a Federal Retirement Consultant that uses proven strategies to help federal employees achieve their financial goals and make sure they receive all the benefits they worked so hard to achieve.

In helping federal employees, Rick has seen the need to offer retirement plan coaching where Human Resources departments either could not or were not able to assist. For almost 14 years, Rick has specialized in using federal government benefits and retirement systems to maximize retirement incomes.

His goals are to guide federal employees to achieve their financial goals while maximizing their retirement incomes.

The Complete Schedule for Social Security Checks

March 13, 2024 /by jason anderson

Social Security retirement benefits, like disability and survivor benefits, are generally paid in the month after the month in which they’re due. So, if you want to begin collecting Social Security payments in July, your benefits will be delivered in August.

However, the day of the month you were born determines your benefit payment. Here’s when you can expect to get your monthly paycheck.

If you were born:

From the 1st through the 10th, your check will be deposited on the second Wednesday of each month.

From the 11th to the 20th, your check will be deposited on the third Wednesday of each month.

From the 21st through the 31st, your check will be deposited on the fourth Wednesday of each month.

However, there are a few exceptions to this schedule. If your Social Security check is due on a holiday, it’ll be deposited the day before. Also, if you receive both SSI and Social Security payments, you’ll get your Social Security check on the third day of the month.

You should also be aware that Social Security payments are sent on the third day of the month to beneficiaries who began receiving benefits before 1997.

For a comprehensive list of payment dates in 2022, go to SSA.gov/pubs/EN-05-10031-2022.pdf.

Receiving Alternatives

You can get your income from Social Security in two ways. The most common one is direct deposit into a bank or credit union account since it’s simple, safe, and secure. If you don’t want this option or don’t have a bank account into which your payments may be transferred, you can purchase a Direct Express Debit MasterCard and have your benefits put into the card’s account.

This card may then be used to withdraw cash from ATMs, banks, or credit union tellers, pay bills online and by phone, make purchases at shops or places that accept Debit MasterCard and receive cash back, and purchase money orders at the U.S. Post Office. Your account is debited automatically when you spend or withdraw money. You may check your balance by phone, online, or at ATMs.

There’s also no cost to apply for the card, no monthly fees, and no overdraft fees. However, optional services, like multiple ATM withdrawals, have minor charges. Cardholders now receive one free ATM withdrawal per month; however extra monthly withdrawals cost 85 cents, plus a surcharge if you use a non-network ATM. For additional information, go to USDirectExpress.com or call 800-333-1795.

When and how to apply

The SSA advises applying for benefits three months before you expect to begin receiving payments. That’ll give you sufficient time to ensure you have all the information required to complete the application. A checklist of everything you’ll need may be found at SSA.gov/hlp/isba/10/isba-checklist.pdf.

You can apply for Social Security benefits online at SSA.gov, over the phone at 800-772-1213, or at your local Social Security office. Be sure to schedule an appointment first.

Contact Information:
Email: [email protected]
Phone: 3234811328

Bio:
For over 13 years, Jason Anderson has served as a Personal Financial Advisor, Estate and Retirement Planner, helping to educate individuals from all walks of life and income levels on wise money investment and planning for a comfortable lifestyle and retirement.

Over time, Jason Anderson has become the ‘Go-To’ leading authority on personal financial advising, financial planning, and analysis, as well as retirement planning and financial planning for SMALL BUSINESS OWNERS. He also provides HIGHLY Popular financial education seminars for groups. These financial seminars empower people to more effectively budget, plan, manage their money, and achieve their personal financial goals. As a result of the excellent results, praise, and feedback that their financial seminars have received, the City of Los Angeles, The AFL-CIO union groups, as well as several other organizations, have decided to partner with Jason to more effectively accomplish their mission. He was also honored to be showcased in the November 2014 issue of Forbes Magazine “Americas Financial Leaders” and has been dubbed by the media as ‘The Financial Educator.’

Jason is passionate about the work he does because it brings him joy to help his financial planning and advising clients reach their financial goals. He finds excitement in assisting families in saving and paying for their children’s college education without stress, thanks to the financial plans he designs for them. He also takes pride in witnessing clients reach retirement and enjoy it precisely the way they desire.

Personally, Jason finds joy in being a husband and father of two wonderful children. In his spare time, he enjoys traveling, sports, hiking, and reading.

He works with Employees, Business Professionals, Business Owners, and ‘High Net Worth’ People.

► Like to discuss your personal financial situation?
☏ Call Jason at (323) 481-1328 for a FREE Consultation
✉ Email him at [email protected]

Disclosure:
All annuity and life insurance products are designed to supplement securities as part of an overall plan. The recommendation of annuities and life insurance is not designed to eliminate the need for securities in any way.

The Matter of Retiring from Government Employment

March 12, 2024 /by ali el-sayed

It’s easy to conclude that retirement is sheerly based on numbers, especially when it comes to the federal government’s opinion on retirement. According to the CSRS and FERS retirement programs, employees are eligible to voluntarily retire after so many years of service or a specific age. Whether retirement is due to a disability or an early-out offer, there are many different rules to consider.

Federal employees are generally aware of the specific date they will meet either of those numbers many years in advance. Some of them spend time counting down the years, which turns into months and, eventually, days. As many hope for an early-out option to shorten their countdown, up to 15% of federal employees are currently eligible to retire & remaining on the job.

Federal employee retirement remains on a voluntary basis, aside from a few occupations, including law enforcement. With some employees remaining ten years past their retirement age, one must wonder why they would choose to stay at work time and time again. Aside from financial readiness, other personal factors may play a role in this decision.

One study concluded that individuals have the option of receiving benefits at different ages. There are also phased-in benefit reductions to monthly benefits before the full retirement age (FRA). For example, raising the full retirement age (FRA) beyond 65 would result in fewer people claiming benefits at 62 due to the severe reduction in benefits. Ultimately, the government offers a variety of policies to encourage later retirement.

Contact Information:
Email: [email protected]
Phone: 8132032515

The Cost of Federal Health Insurance Will Rise Slightly in 2022

February 29, 2024 /by Mitul Patel

According to figures published by the Office of Personnel Management (OPM) on September 29, federal workers registered in a health insurance policy under the Federal Employee Health Benefits (FEHB) scheme should anticipate their health insurance expenses to rise by around 2.4% in 2022. That cost hike resulted in an average 3.8% rise for workers and a 1.9% rise for the government, according to the constitutionally required cost distribution between the government and employees.

In a press release, OPM Director Kiran Ahuja stated, “Quality health insurance has never been more vital, and OPM is ensuring that all eligible enrollees have the information they need to make educated choices about their coverage.” “The pandemic highlights an employer’s obligation to offer excellent, cheap, and trustworthy healthcare alternatives to its employees.” The federal government, as the country’s biggest employer, is happy to set an example by offering a diverse range of health insurance plans via the FEHB and FEDVIP that provide the deserved coverage for every individual.”

The cost hikes for health insurance in 2022 are lower than in 2020 and 2021, but they were still almost twice the record low 1.3% rise in 2019. According to the OPM, if Feds receive the 2.7% raise in pay that President Joe Biden plans to implement in 2022, the average health insurance costs for Feds will be around 4.8% of their salary, a slight increase from the average 4.7% of salary cost for Feds in 2021.

In a message, National Treasury Employees Union National President Tony Reardon stated, “Clearly, the government did a better job bringing down the employees’ part of premium expenses in the FEHB scheme for 2022, and we appreciate that improvement.” “However, we will advise our members to plan for price hikes by evaluating all of their choices during the forthcoming open enrollment season and deciding which plan is best for themselves and their families.”

Because of enrollment numbers, average yearly expenditures, the age of people enrolled, and other considerations, federal workers are not assured of receiving precisely the average cost rise on their plans in 2022. Feds who transfer strategies between 2021 and 2022 may experience a more considerable or lower rise, no increase at all, or even a cost reduction.
While increased insurance prices may be inevitable, federal workers and retirees should be aware that they have several alternatives to select from during the open season. Although most subscribers will only face a 5% rise if they re-enroll in their existing plans, it’s still vital to consider your alternatives. In a statement by Ken Thomas, the National Active and Retired Federal Employees Association National President, he stated, “NARFE urges all participants to carefully evaluate the plans and pick the one that best matches their requirements.”

According to the Office of Personnel Management (OPM), insurance costs were primarily due to rising drug prices, chronic sickness expenditures, and medical innovation. COVID-19 costs pushed up pricing, as did increasing demand for mental healthcare, according to OPM. COVID-19 cost the FEHB scheme nearly $1 billion in 2020. However, since many insured individuals postponed medical procedures and utilized their insurance less in the early months of the pandemic, the pandemic helped lower medical insurance costs.

Overall, COVID-19 expenses are predicted to reduce in 2022 due to vaccines and the requirement that government workers obtain them since the federal population is less likely to have a severe coronavirus illness. Next year, federal employees will have 275 options, one less than in 2021, with the same 18 countrywide plans accessible to federal employees in any location of the country. The remaining 257 plans are offered in some nation regions. They include 192 HMO plans, 37 high-deductible health plans, and 28 consumer-driven health plans.

These plans signify a trend away from HMO plans, which have cheaper premiums but seldom cover out-of-network care, and toward HDHP plans, which have lower rates but larger deductibles. 20 of the 23 new plans offered by current FHB carriers are HDHPs. The new carrier, Virginia-based Healthkeepers Inc., also provides an HDHP plan.

Federal employees may also choose between 18 fee-for-service plans, which pay healthcare providers directly or reimburse enrollees for services delivered, and 28 consumer-driven health plans, which establish spending limitations before an enrollee’s part of the expenses rises. In 2022, FEHB providers will be required to implement a new feature that will alert members when a medicine that requires prior permission is about to expire.

Prior authorization is a procedure that insurance companies need for some drugs that may have less expensive alternatives, have serious side effects, are only used for aesthetic reasons, or are created for particular age groups and medical problems. When a doctor prescribes one of these drugs, the insurer goes through a review procedure to see whether they would cover it. Patients taking maintenance drugs must have their prior authorizations for such prescriptions evaluated regularly, or they will expire. The new 2022 requirement requires FEHB carriers to inform participants 45 days before their prior authorizations expire.

The FEHB program’s open season starts November 8 and ends December 13.

OPM Retirement Backlog Keeps Increasing.

February 27, 2024 /by marvin dutton

The Office of Personnel Management (OPM) data shows that the retirement backlog has reached a new high of 36,603, which was last recorded in March 2013.

The current backlog of OPM retirements is 36,349. It has increased by 16% in 2022 and 48% since its low point of 24,619 in May 2021. Recently retired federal employees waiting for their claims to be processed did not expect to miss the days when the OPM retirement backlog was “only” 24,000 claims.

The number of retirement claims received by OPM’s retirement services office was higher than usual last month. The backlog grew because OPM received 10,042 new claims and only processed 9,117. It increased by nearly 3% at the end of February.

Despite fluctuations over the last five years, OPM’s retirement backlog has increased by 77% since March 2017.

How long does the OPM take to process a federal employee’s retirement claim?

The Office of Personnel Management (OPM) claims to process federal employee retirement applications in 60 days on its website. With such a large backlog, it’s understandable that some new federal retirees may have to wait longer.

This is an OPM website response to one of the frequently asked questions:

“Retirement Services makes every effort to process retirement claims within sixty days. However, if we require additional information from you or your previous employer, your claim may take longer to process. If your retirement claim, for example, has unique conditions, it may take longer than usual (e.g., applying a specific retirement law, evaluating a court order, etc.)

It may also take longer if we need to contact you to make a benefit election (such as a service credit deposit), if we need to contact your former employer for further information, or if a benefit from another agency, such as the Social Security Administration, affects your claim.”

What Can Federal Employees Do to Make the Retirement Application Process Go More Quickly?

According to OPM, the most straightforward approach to minimize delays is to submit your retirement application packet early and double-check that everything is in order. Another question from the OPM website:

“By submitting your application ahead of time and ensuring that your Official Personnel Folder (OPF) is complete, you can assist reduce processing delays. Your personnel and payroll offices will be able to finish their actions before your retirement date if you submit your documentation early.”

How to Avoid Common OPM Retirement Application Errors

Any errors on your OPM retirement application packet will only slow down the process further, so be sure you don’t make any.

Initial retirement cases completed in less than 60 days took an average of 44 days, while those completed in more than 60 days took 128 days.

Contact Information:
Email: [email protected]
Phone: 2129517376

Investment Window Policies Finalized by TSP

February 26, 2024 /by todd carmack

TSP account holders have awaited the opportunity to move their investments away from mutual funds throughout the program’s history. Having gone into effect on June 1st, the Federal Retirement Thrift Investment Board (FRTIB) has adopted a new rule without any changes. TSP participants were poised to begin utilizing the new mutual fund window the same month to expand their horizons and save money.

A new record-keeping system enables investments to be made through the mutual fund window, thanks to the ease of an app, new online features, and additional security features. More significantly, certain transactions had to experience suspended access between May 26th and the early-June launch date. In addition, a new annual administrative fee, annual maintenance fee, and individual trade fee were enacted, specifically for those who opt for the window. Minimal initial transfer amounts and a limit on investments through the window were also put into effect. These changes mean that the option will be extended to investors with $40k or more invested within a TSP.

Because the FRTIB has expressed the value of overall transparency toward TSP participants, the fees have been posted in dollar amounts. Through account maintenance fees and transaction fees, TSP participants choose to pay indirectly through revenue shares. There is also a limit regarding the amount of retirement savings that can be used for mutual funds. While many have criticized the 25% cap, the FRTIB assures investors that the cap is not intended to replace core TSP funds. The mutual fund window was created to enhance TSP rather than provide it as an alternative to core options.

Contact Information:
Email: [email protected]
Phone: 7735026467

Bio:
Todd Carmack grew up in Dubuque, Iowa, where he learned the concepts of hard work and the value of a dollar. Todd spent years in Boy Scouts and achieved the honor of Eagle Scout. Todd graduated from Iowa State University, moved to Chicago, spent a few years managing restaurants, and started working in financial services and insurance, helping families prepare for the high cost of college for their children. After spending years in the insurance industry, Todd moved to Arizona and started working with Federal Employees, offing education and options on their benefits. Becoming a Financial Advisor / Fiduciary can help people properly plan for the future. Todd also enjoys cooking and traveling in his free time.

There is a major issue in your retirement savings plan: GMO

February 20, 2024 /by rick viader

Americans nearing retirement are shocked. Unsophisticated “McMoney” accounting consultants told them that bonds were secure, steady, and reliable and that balancing stocks and bonds was fine in all scenarios.

To their dismay, none of these things are true in January. GMO analysts James Montier and Martin Tarlie wrote a report explaining why these assumptions are erroneous, how they might harm our retirement accounts, and what we can do.

If financial planning had an anthem, it would be “Let’s Do the Time Warp Again.” Planners develop client portfolios using old, outdated ideas. Portfolios are designed using 1952 technology and 1970s assumptions. According to a 50-year-old methodology, today’s retirees face huge portfolio risks.

These techniques are “Random walk” assumptions â€” market simulations. Assuming stock and bond fund returns don’t affect past performance. Montier and Tarlie debunk it. Valuations, which are based on current performance, affect future returns. Ascending must descend. Buy low, sell high.

Why presume random returns? They may question you if you don’t have orange-and-brown shag carpeting, an avocado green bathroom suite, bell-bottom jeans, or pork chop sideburns. Okay. Expect a slump if stock prices rose faster than profits, dividends, or economic growth over a decade. After a decade or more of Fed manipulation, bond prices may have risen. Financial journalists and specialists are “shocked, astounded” by the decrease in bond prices this year. Bond index funds have lost 10%, including the iShares Core U.S. Aggregate Bond Index ETF AGG, -0.35% TIP, -0.25%, and VAIPX, +0.40% have dropped roughly 9%. Long-term Treasury bonds dropped 30% today. This is the worst bond market since the 1970s. Some say it’s worse than the 1840s.

The typical “60/40” portfolio of 60% stocks and 40% bonds has lost a disastrous 16%.

Should we be surprised? Bonds enable: Price rises reduce yield or interest rate. After a generation of rising prices and falling yields, bonds entered 2022 more expensive than ever. If you purchase a 10-year Treasury bond on January 3, 2019, at a yield of 1.6% and hold onto it for ten years, I can tell you how much you will have profited.

Even if 10-year Treasury bonds have returned 5% annually historically, this is immaterial. Investing in a 10-year Treasury bond with a 5% starting yield is the only way to earn 5% yearly compounded.

TIPS are much more straightforward. Through a clever computation, annual returns are adjusted to match the consumer-price index, assuring a “real” inflation-adjusted yield beyond what inflation would offer. 10-year TIPS yielded 1% less than their nominal rate to start the year. Investing in the bond for ten years would reduce your purchasing power by 10%(without extra fees).

Error-free. Definitely. If you could earn a profit instantly, you may have traded commodities. Such enterprises’ capital loss shouldn’t have shocked investors. TIPS with a negative “real” yield were worse than cryptocurrencies. TIPS could not be held to maturity to increase wealth. The math didn’t work.

“Investors” bought Treasury bonds with 1.6%-2% yields in January. 1-year bonds yielded 0.4%, 10-year bonds yielded 1.6%, and 30-year gave 2%. When did inflation peak? It’s 7%. Burning money is a waste.

My friend was new to financial advising. I warned him to avoid “confiscation certificates.” Falling stocks are less predictable. Bonds weren’t appealing.

Valuation, growth, and yield affect equity returns, argue Montier and Tarlie. Return generator characteristics. Easy math. They use 1890s stock market data to verify it. U.S. stock prices have risen for 15 years.

Montier and Tarlie emphasize advisor risk. Risk isn’t volatility. Retirement poverty is “ruin.” “Putting it all together, you get a harsh judgment of how the financial planning industry helps folks prepare for retirement, including simplistic “glide pathways” given by a sector whose main goals are to collect assets and avoid being sued. The challenge is replacing or adding to it. Montier and Tarlie provide two possibilities.

The first is a “glide path” that avoids pricey equities and bonds. The GMO warned for years about inflated U.S. equities, but it was too early to act (and at worst, plain wrong). The probabilities favor their second idea. Reduce long-term bonds for equities and “short-term bonds” like Treasury bills or near-cash. When bonds are pricey, the short-term paper may be safer.

Warren Buffett and Andrew Smithers recommend Treasury bills or short-term bonds to complement equities.

Even minor exposure to commodities (through futures funds like DBC or resource stocks funds like GNR) may help diversify a portfolio. Simple models with basic assumptions shouldn’t be trusted.

Contact Information:
Email: [email protected]
Phone: 9568933225

His goals are to guide federal employees to achieve their financial goals while maximizing their retirement incomes.

Strategies for Long-Term Financial Security: Advice for Federal Employees

February 16, 2024 /by stephen william

Long-term financial security is a top priority for federal employees as they plan for retirement and navigate the complexities of the federal benefits system. This article provides actionable advice and strategies to help federal employees achieve long-term financial security, covering topics such as retirement planning, investment management, healthcare costs, and estate planning.

Planning for Retirement:

Start Early and Save Consistently: Begin saving for retirement as early as possible and contribute consistently to retirement accounts such as the Thrift Savings Plan (TSP) and Individual Retirement Accounts (IRAs). Take advantage of employer matching contributions and tax-deferred growth opportunities to maximize your retirement savings potential.
Understand Your Retirement Benefits: Familiarize yourself with the various components of your federal retirement benefits package, including the Federal Employees Retirement System (FERS), Social Security, and TSP. Understand how each component works, how benefits are calculated, and what options are available for distribution and survivor benefits.
Develop a Retirement Income Plan: Create a comprehensive retirement income plan that outlines your sources of retirement income, estimated expenses, and investment strategies. Consider factors such as inflation, healthcare costs, and longevity when projecting your retirement income needs and develop a plan that aligns with your goals and risk tolerance.
Seek Professional Guidance: Consider working with a certified financial planner or retirement advisor who specializes in federal employee benefits. A professional advisor can help you develop a personalized retirement plan, optimize your investment portfolio, and navigate the complexities of the federal benefits system.

Managing Investments:

Diversify Your Investments: Diversification is key to managing risk and optimizing returns in your investment portfolio. Spread your investments across different asset classes, such as stocks, bonds, and real estate, to reduce volatility and enhance long-term growth potential.
Rebalance Regularly: Regularly review and rebalance your investment portfolio to maintain your desired asset allocation and risk tolerance. Rebalancing involves selling assets that have performed well and reinvesting the proceeds in underperforming assets to maintain your target allocation.
Consider Lifecycle Funds: Consider investing in lifecycle funds offered through the Thrift Savings Plan (TSP), which automatically adjust your asset allocation based on your target retirement date. Lifecycle funds are designed to become more conservative as you approach retirement, reducing risk and preserving capital.
Monitor Fees and Expenses: Be mindful of fees and expenses associated with your investments, including management fees, expense ratios, and trading costs. Minimize fees where possible by investing in low-cost index funds or ETFs and avoiding unnecessary trading activity.

Contact Information:
Email: [email protected]
Phone: 7988550130

Why You Should Consider a Thrift Savings Plan Investment Today

February 14, 2024 /by rick viader

The Thrift Savings Plan (TSP) is a one-of-a-kind retirement plan that provides significant benefits to participants who join the program, use its features, and do their best to plan for their financial future.

Some may see its simplicity as a disadvantage; however, it makes managing one’s retirement very simple for the average person.

The TSP’s use of only five essential proprietary funds poses a problem. This means that there are only five primary funds to choose from; as a result, you cannot invest in your preferred company, no matter how much you like Apple, Disney, Ford, or any of the thousands of other companies. You cannot even consider investing in energy or retail mutual funds.

However, analyzing the dozens of funds, ETFs, or thousands of stocks available to you will not require much mental effort or time.

The fact that you can only choose from five different funds makes it simple to invest in the market and build a comfortable nest egg for your golden years. Unfortunately, the government does not make things as easy as they appear.

Your payroll deductions will be deposited into the TSP G Fund, as directed by the government. If you keep your money in the G Fund, it will not earn any interest or profit. It is a highly conservative bond fund to keep pace with inflation. You won’t be losing money, which is good, but you won’t be contributing to a retirement fund, so even if it keeps up with inflation, you won’t have enough money to live comfortably when you’re older.

What options do you have for your TSP?

The other four funds are as follows:

F Fund

The F Fund is similar to the G Fund in that it invests in bonds, but it offers a higher potential return than the G Fund, meaning that your capital will experience more growth.

C Fund

The objective of the C Fund is to replicate the performance of the most significant component of the S&P 500 market index, comprising the 500 largest companies.

S Fund

The S Fund is an investment vehicle that attempts to model its investments after the largest U.S. companies in the Dow Jones group.

I Fund

The I Fund is a group of different international funds that work together.

There are additional Life Time funds known as L Funds. These funds adjust the proportion of their holdings in each of the five primary funds based on when you plan to retire. The disadvantage of these funds is that government administrators assume everyone is the same and will have the same financial needs, goals, and challenges during their investment years and after retirement. This could be challenging since no two people are alike.

You may be able to increase the size of your account to accommodate your goals if you use a personal investment program. A few mutual and exchange-traded funds (ETFs) accurately replicate the TSP funds. However, because the government does not release day-to-day data, investment software cannot analyze and make decisions using the government TSP funds. However, several other mutual funds and ETFs are exact duplicates of the TSP funds. You will be able to know the best time to move your money from one fund to another by entering these funds into a program and developing back-tested strategies. Alternately, you can consider your personal preferences when building a portfolio of investments to maximize your return and get the most for your money.

There are a few precautions to take and a general strategy to follow to implement a good TSP management plan successfully:

According to the TSP trading rules, investors can only make two trades (transfers) per month unless they invest in the G Fund.
The best way to handle payroll deposits is to direct them to the F Fund, where they can be traded or transferred the following month.
Use personal investment management software as a guide to help you decide when and where to move your money within the various TSP funds.

Putting money in your retirement account to work for you rather than against you will result in a larger retirement nest egg and less stress about your finances. Establishing your TSP strategies should only take 20 to 30 minutes every few weeks.

You Could Borrow from Your TSP Account

TSP loans allow you to borrow money from your TSP account. In this case, you essentially act as your own lender, making payments to your account with interest that varies depending on the average yield of all U.S. Treasury securities with at least four years to maturity.

Loan Caps

A TSP loan has a $1,000 minimum borrowing amount. The following rules govern the maximum amount you can borrow:

You can’t borrow more than you’ve put into the account plus your earnings.
You cannot borrow more than 50% of your account’s value or $10,000, whichever is greater.
You cannot borrow more than $50,000 minus any TSP loans taken within the past year.

Given the median home price in the U.S. of $355,900, a TSP loan will not buy you a decent home in most areas. But you can still use your loan to pay for closing costs or even your down payment. This can help you buy a bigger home than you might be able to otherwise.

Your TSP plan administrator handles all the back-end work, such as sending out loan funds and depositing them back into your account as you repay them over time. However, remember that the interest rate you’ll pay yourself is likely lower than what you could earn elsewhere, such as in the stock market or another interest-bearing account.

Contact Information:
Email: [email protected]
Phone: 9568933225

His goals are to guide federal employees to achieve their financial goals while maximizing their retirement incomes.

How to Get the Most Out of Your FERS Pension

February 13, 2024 /by jason anderson

The federal government’s FERS has a three-legged stool of retirement benefits comprising the Basic Benefit Plan, the Thrift Savings Plan (TSP), and Social Security.

This article focuses on the Basic Benefit Plan, also called the federal government pension.

Pension Calculation for FERS

The FERS Basic Benefit Plan, or pension, is determined by multiplying the duration of creditable service by a percentage (typically 1% or 1.1%) and then multiplying by the “high-3” average wage. The 1% is used for those under age 62 at the time of separation for retirement and those over 62 with fewer than 20 years of service.

If a federal employee quits at 62 with at least 20 years of creditable service, the percentage rises to 1.1%. These three years are typically your last three years of service, but they might be earlier if your basic pay is more. Your basic pay is the basic salary you earn for your job.

As a result of evaluating the three years of your highest pay more heavily to maximize the pension benefit, it makes sense to retire after you have earned the highest salary in the federal government. Furthermore, if you work until age 62 and have 20 years of service, you will receive 10% extra in lifetime pension income!

Survivor’s Benefit

With the pension, the survivor’s benefit is equally essential to consider. That’s particularly important since you can leave the surviving spouse half of your pension if you die before them. The pension annuity is lowered by 10% if the survivor’s benefit is 50%.

The survivor’s benefit is sometimes overlooked when calculating your FERS pension benefit. You can offer your surviving spouse 50% of your annuity for a minor 10% reduction in your monthly payout.

Cost-of-Living Adjustments (COLAs)

COLAs are an essential part of the pension. When the cost of living rises for basic necessities such as groceries, gas, and so on, your purchasing power diminishes.

So, the FERS pension includes a cost of living adjustment. In general, it would be best if you were 62 to increase the cost of living. Inflation is currently near 40-year highs and is unlikely to fall for some time.

The cost-of-living adjustment (COLA) is an essential component of the pension since it is one of the major issues with many pensions that aren’t adjusted for inflation. As a result, your purchasing power erodes over time, and you must make up the difference elsewhere in your budget.

Maximizing FERS

The following are the top four ways to maximize your FERS pension:

1) Retire with at least 20 years of service and at least aged 62. Your monthly pension payment will grow if you can retire with more than 20 years of service. However, aim to maintain a minimum of 20 years and an age of 62.

2) Retire in your 60s with the highest three years of salary. Before you retire, work on achieving your large advancements in the federal government. In this case, your multiple is based on a greater last three years’ wage.

3) Defer taking the pension benefit until you reach 62 to maximize the COLA and then take advantage of it instead. Then, if possible, retire at 62 or later.

4) If married, consider the survivor’s benefit. You may cover your spouse with a 50% monthly annuity for a modest reduction in your monthly annuity.

These four basic guidelines don’t apply to all situations, so you should discuss them with a financial consultant for advice tailored to your situation.

Contact Information:
Email: [email protected]
Phone: 3234811328

Personally, Jason finds joy in being a husband and father of two wonderful children. In his spare time, he enjoys traveling, sports, hiking, and reading.

He works with Employees, Business Professionals, Business Owners, and ‘High Net Worth’ People.

► Like to discuss your personal financial situation?
☏ Call Jason at (323) 481-1328 for a FREE Consultation
✉ Email him at [email protected]

Contact Information:
Email: [email protected]
Phone: 3234811328

Personally, Jason finds joy in being a husband and father of two wonderful children. In his spare time, he enjoys traveling, sports, hiking, and reading.

He works with Employees, Business Professionals, Business Owners, and ‘High Net Worth’ People.

► Like to discuss your personal financial situation?
☏ Call Jason at (323) 481-1328 for a FREE Consultation
✉ Email him at [email protected]

Ways You Can Invest in Veteran Hires

February 13, 2024 /by marvin dutton

If your firm has dedicated time and resources to veteran recruitment or is stepping up these efforts, you also have to think of ways to invest in their success once they’ve been hired. Here are some top tips.

Benefits & Policies evaluation

Actions speak louder than words when developing a diverse, engaged workforce. You can take action by offering more tailored benefits to veterans and military-connected individuals. Group life and health insurance can enhance veterans’ government coverage. If you hire or recruit many veterans, you should provide them special perks personalized for their circumstances. Many of these options offer profitable rates, individual customer care, and financial education resources for military-connected employees.

Many industries now allow remote or hybrid work. Make sure military spouses and veterans have flexible work opportunities too. Providing a serving spouse job stability in the face of relocations or allowing a recently-separated veteran to find a permanent home while keeping employment at your company helps employees and lets your company retain top talent regardless of location and lifestyle.

Inform staff about affinity groups and EAPs. Many give veterans direct access to additional resources and incentives, such as mortgage recommendations, gym membership discounts, and physical and mental health help. Show your support by continuously connecting with affinity groups and making their resources available to veteran employees during onboarding and through internal communications.

Promote networking

Many veteran employees will be at a significant transition point in their lives and careers. Using existing talents and structures can make employees feel welcome and supported. If your company employs veterans or military-connected individuals, create a special employee resource group for them. That can help them find mentors, learn about corporate culture, and exchange experiences. Human resources and benefits decision-makers should stay in touch with this group. Their feedback on things like family leave, childcare, and training programs might help identify a need for changes. Your employees will appreciate you actively listening and changing corporate regulations.

Encourage learning

Your organization needs a thorough education program to encourage veteran hiring. Easy access to certificates, college credits, and tuition help is a win-win. They’ll gain skills and confidence in a new job setting or industry, making them an asset to your company. HR and mentors should ask veterans what they want from their careers in the future and support further education.

On-the-job training and development initiatives for new hires of various backgrounds are also important. If you have a network of veteran employees, foster mentorship through training and development initiatives. Discuss these programs with new and old employees. Their experience can guide training and development structure, goals, and metrics.

If you’re still hiring experienced employees, external organizations and affiliates can help. American Corporate Partners can help with mentoring, hiring, and onboarding as you build internal procedures.

Engage with other firms and service organizations

Even if your veteran hiring and engagement program is robust, consider chances to collaborate with local and national service organizations. Countless organizations range from general awareness to industry or issue-specific. Explore affiliate programs with these organizations to determine if they may offer mental health or financial advisory services to your veteran personnel.

Providing annual service hours is another approach to keep staff engaged and strengthen ties to local military and community organizations. That’s a win for local nonprofits, veteran employees wishing to continue active in service, and your company as it grows its role as a change-maker for staff and the community.

Contact Information:
Email: [email protected]
Phone: 2129517376

Benefits and limitations of thrift savings plan annuity

February 8, 2024 /by todd carmack

Annuity, like other retirement plans, is a plan in which you pay a certain amount now, enabling you to receive a monthly allowance until your last breath.

The Thrift Savings Plan (TSP) annuity provider provides different services like:

Joint life annuity: This TSP is for you and your spouse or someone closer and dearer to you. Your joint annuitant is advisable to be part of the people with an insurable interest in you. The joint life TSP annuity allows you and your partner to receive monthly earnings as long as you are both alive or one dies, leaving the other partner alive. The pension still covers the monthly allowance of the survivor for the end of their life.

Single life annuity: The TSP single life annuity only offers you the monthly payment benefits as long as you are alive and stops after you die. This annuity plan can not be transferable to your partner.

100% survivor annuity: This is one of the benefits of the joint life annuity package. Choosing this pension plan allows the survivor to receive the same monthly amount you receive when both of you are alive. For instance, the monthly payment for you and your annuitant is $1000; when both of you are alive, the survivor will also get that amount if any one of you dies.

50% survivor annuity: The 50% survivor annuity plan is also not a bad idea. The monthly fees to the survivor will be 50% of the initial amount paid while both of you are alive. It is advisable to choose this plan option, especially if you are ten years older than your joint annuitant. It will serve as a windfall, not something you will rely on as a means of surviving.

Annuity payment options

You should choose the joint or single life annuity and consider the two payment options and the factors that affect the monthly annuity payments.

Level payment: If you choose this payment option for either the single or joint life annuity. You will receive the same amount of money monthly throughout your entire life for the single-life grant. While for a joint life grant, you and your joint annuitant will receive the same amount monthly every year without any increment. The survivor’s amount will later depend on whether you chose the 100% or 50% survivor annuity.

Increasing payments: This payment option might not be impressive to you because the amount paid per month is small compared to the level payment option. However, This increasing payment is preferable to the level payment due to the rapid economic growth. Things are changing every day, and your income should also be increasing. The annuity payment will be increased yearly by 2% on the first day of payment. Before March 2, 2020, the income from the TSP annuities rose between 0% and 3% annually based on the consumer price index.

The other side of this plan is that you can not choose this payment option if your joint annuitant is not your spouse.

Factors that can affect your monthly annuity payment include the following:

§ The amount you used to acquire the TSP annuity.

§ TSP annuity option you opt for (the single or joint life annuity).

§ Your age or the age of your joint annuitant when you bought the annuity.

§ The “interest rate index” when you purchase the annuity.

Additional features of TSP annuities

Providing payment for beneficiaries

You can provide payment options to your beneficiary(ies) in the annuity section of your TSP withdrawal form. Note that your monthly receivable amount will be lesser than when you did not choose any additional features.

Cash refund

Assuming you and your partner (if the joint annuitant is applicable) die before they pay you, the remaining amount of the TSP balance you used to obtain your annuity will be paid to your beneficiary(ies) in a heaping sum. This feature applies to any of the annuity plans.

Ten-year certain

If you buy the single life annuity, you can add the ten-year specific feature to your plan. The features give you 100% assurance that you or your beneficiary can receive your money until ten years if you are alive or dead. Also, if you live beyond ten years, you can still collect your monthly payment. Still, your beneficiary(ies) are not eligible for the annuity payment when you die.

Special considerations (spouse’s rights)

The additional pension feature gives your spouse rights over your annuity purchases whether you are together or separated. Presuming you are a uniformed officer or FERS, your spouse is legally eligible for a joint life annuity with level payments, no cash refund, and 50% survivor benefit. Suppose you have more than $3,500 and want to make a total withdrawal from your account; your spouse must sign the statement on your withdrawal form, which waives their right to it. In this case, you do not use the aggregate money to purchase the annuity.

Contact Information:
Email: [email protected]
Phone: 7735026467

Don’t Put Your Customers’ Retirement Plans in the Hands of Medicare

February 1, 2024 /by ali el-sayed

Health Savings Accounts (HSAs) can assist with paying current and future medical costs, including those associated with retirement. There was a time when many workers in the United States could look forward to a comfortable retirement, complete with profit sharing and investments, a pension, benefits from Social Security and Medicare, and other amenities. They were confident that their golden years would be marked by rest, mental tranquility, and relatively few worries regarding their medical expenses.

Unfortunately, times have changed. Presently, a pension plan is available to only 15% of workers employed in the private sector in the United States. Only about one-fifth of companies in the United States offer a profit-sharing program. The Dow Jones Industrial Average experienced a value reduction of more than 10% during the first four months of 2022. Those who are 64 years old have a median balance of less than $85,000 in their 401(k) accounts, but the average balance for this age group is $232,000.

There is no cookie-cutter model for retirement. However, one factor that will affect everyone throughout their senior years is the rising expense of medical care. Many regulations come with Medicare, and if seniors break any of them, it might increase the amount of money they have to pay for their medical treatment for the rest of their lives. According to Katy Votava, president of Goodcare.com, “People do feel overwhelmed and baffled by Medicare. However, there are a few fundamental tasks that a consultant can perform.”

Advice for those working in the financial sector

There are, without a doubt, many intricacies to Medicare’s requirements. Taking on such a challenge might be difficult if you do not have someone on your team who is fully committed to working through the issue. However, there are several methods that financial advisers may utilize to start the discussion with clients, as well as resources that they can send customers to get the dialogue started.

Include discussions about healthcare on the agenda for your next client meeting. “Put it on the yearly agenda, and a lot of those problems will fall out before they’re a crisis,” Votava said. “Put it on the quarterly agenda, and it will fall out before it’s a catastrophe.” When customers reach the age of 62, you should begin discussing Medicare with them. Ask them what physicians they are currently seeing and whether they will be able to continue seeing those doctors once they become eligible for Medicare.

Develop working ties with Medicare specialists in your area so that you may recommend consumers to them. As a start, asking customers who have previously been through the procedure for their recommendations on impartial insurance companies is a good idea. Prepare a list of resources for the clients in advance. Eldercare.gov, Medicare.gov, the Medicare Rights Center, and State Health Insurance Assistance Program (SHIP) are excellent places to start when looking for information on Medicare. Advisors may also help clients troubleshoot a few critical circumstances in which clients are most likely to make mistakes by engaging in certain problem-solving activities.

Reaching the age of 65

When it comes to becoming eligible for Medicare, reaching age 65 is a prerequisite. However, precisely what this entails is shifting due to the growing number of people who continue to work into their 60s. Because of this, many of your customers are likely to inquire about Medicare with the same query: “Do I have to sign up when I am 65, or can I wait?” according to Votava. If a customer has a health plan through their employer that satisfies the requirements, they can put off enrolling in Medicare if they continue coverage as long as they stay in their job. This is on the condition that they have not begun receiving retirement payments from Social Security, which would result in their automatic membership at the age of 65 in Medicare Parts A and B, which cover medical and hospital insurance, respectively.

Your client’s company must have at least 20 employees to be eligible for the delay. According to Votava, the employment plan cannot be either a retiree plan or a COBRA plan. According to her statement, the plan’s prescription medication coverage must also satisfy the criteria of Medicare. Votava advised that if the individual already had the necessary coverage, they might put off enrolling in the program until a later date that offered a special registration period. “If none of those conditions apply to you, then you should enroll in Medicare,” Votava says.

According to Votava, one thing you will want to make sure your customers who are still working and are in their 60s think about is that Medicare coverage might sometimes be a better option than an employment plan. If a customer is going to be required to join up beyond the age of 65, they do not want to wait until the last minute as the penalties are expensive. The first registration period begins three months before a person turns 65 and continues until three months after that milestone birthday.

If your client misses that date and does not have creditable coverage, they will face a 10% surcharge on their premium for every 12 months they wait. J.P. Morgan Asset Management provided this information. “If someone goes into it with the mindset, ‘Hey, I’m in excellent condition,’ it may end up being extremely expensive,” Roy said. Electing to enroll for Medicare only once the client absolutely needs to could be a grave error, as “choosing to go that route will set [them] back a lot of money.”

Contact Information:
Email: [email protected]
Phone: 8132032515

Tag: thrift savings plan

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