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Retirement Cannot Be A Secret
/by Dianna TafazoliYour plans for retirement should include your family. Retirement is a family decision where communication is most important. There are so many benefits with provisions that can be complicated in the federal retirement systems. The federal employee as well as family members need to understand the fundamental concepts of all federal retirement and health benefits available.
Take time to discuss with your family how you feel about retirement. If you are experiencing some emotional separation about your impending retirement, discuss it with your family members or someone you can trust. Talking about your concerns and issues will make the transition from work to retirement much easier.
Don’t go through the challenges of retirement alone. If you don’t feel comfortable talking to your family about your fears and anxieties, you can always get counseling from a career coach or some other professional familiar with the highs and lows people experience about retirement.
If you know other people who have retired try talking to them. Let them share their experiences with you and I am sure what they describe will resonate with what you are feeling. Retirement for many is like saying goodbye to an old friend and that is always painful, even causing some tears to fall. There is absolutely nothing wrong about missing what has been such a significant part of your life for such a long time. There is nothing wrong with being afraid or feeling that you are no longer valued. Allow yourself a time to grieve, maybe 30 minutes, okay an hour and then shake it off and say – Look out world, I am ready for the next new adventure and this time I am doing on my own terms.
You can find the rainbow in retirement if you see all the years you worked as preparation for the best years of your life.
P. S. Always Remember to Share What You Know.
RELATED TSP ARTICLES
Thrift Savings Plan (TSP) Withdrawal Options
For Postal Employees – LiteBlue and the TSP
Federal and Postal Employees – Choosing a Financial Professional
Is All ‘Your’ TSP Money Actually Yours?
Save Don’t Spend
/by Dianna TafazoliOne concept that should be a part of the fabric of our being is save, save, save during the last five years of our federal work career. Hopefully you have been contributing to your TSP since you began working, but certainly the last 5 years before retirement is a time you should save like never before. These last 5 years should be seen as preparing to come into the home stretch of your retirement years.
If you don’t spend money then you should be saving money. The spending you should be doing during the five years prior to retirement should only be for paying those expenses you must – rent/mortgage, utility bills, food, and other must-pay, mandatory items. No extra unnecessary spending should take place during this time.
You are saving now so that you don’t have to pay later and find yourself unhappy, and unsecured in your retirement years. Be frugal during the last five years of your work life, after all you have worked for 20 to 30 years and you should have acquired most of the things you needed and wanted.
When you are contemplating retirement you should scale way back on your spending so that your debts are reduced significantly. The only large debt that might go into retirement with you is unfortunately a mortgage.
Every time you think about spending during the last five years of your retirement, think about how much you want to live in comfort and security and Save ferociously.
P. S. Always Remember to Share What You Know.
RELATED TSP ARTICLES
Thrift Savings Plan (TSP) Withdrawal Options
For Postal Employees – LiteBlue and the TSP
Federal and Postal Employees – Choosing a Financial Professional
Is All ‘Your’ TSP Money Actually Yours?
Federal Retirement Benefit Analysis
Living Will and Durable Power of Attorney
/by Dianna TafazoliLiving Will and the Power of Attorney
A Living Will is an advanced directive giving doctors and hospitals expressed instructions regarding how you want your health care treatment handled. In the event of incapacitation or an irreversible coma and you are unable to articulate your desires, a Durable Power of Attorney can act on your behalf, while you are still alive, ensuring your wishes are carried out. These types of documents are an incredibly important part of your financial plan. The Living Will is generally focused on whether or not an individual wishes to have his or her life sustained by life support systems. Hospitals and physicians are more and more supportive of patients having a ‘living will.’
Whether to sustain life or not by artificial means is such a personal and highly emotional encounter that doctors and hospitals are not eager to bare that responsibility or to have to make such a crucial decision. It is very important that we put plans in place when our capacity to do so is fully intact not leaving painstakingly difficult decisions to be sorted out between family members and loved ones.
For clarity, let’s distinguish between the roles of ‘Power of Attorney’ and ‘Durable Power of Attorney’. Power of Attorney is a fairly well-known concept which is generally invoked for carrying out financial matters when the principal cannot be present. However, when the principal dies the power of attorney also terminates.
Durable Power of Attorney may be a more useful tool when dealing with the elderly and the informed. It allows individuals who can no longer conduct their own financial affairs and affairs otherwise, to continue doing so through the Durable Power of Attorney arrangement. There are no hearings or court proceedings to appoint someone Durable Power of Attorney. It is a simple matter of signing a legal document.
Once again, doing your homework is the key ingredient to success. If you are considering moving in this direction in your planning process, be as certain as humanly possible, that you choose someone you can trust who will always have your best interest at heart.
You may also find it necessary to have both a Medical and Financial Durable Power of Attorney. The Medical Durable Power of Attorney would only be able to handle and speak for your medical treatment and care; while the Financial Durable Power of Attorney would only be able to handle your financial concerns and matters.
In planning your estate, one of the best approaches is to talk to your family about what you plan to do. Open communication with family members and those involved in your life’s achievements concerning how you want to divide your assets is part of implementing an action plan that will help you retire in comfort and security.
P. S. Always Remember to Share What You Know.
For information on your retirement plan and your investments – check your TSP.gov Account regularly.
For postal employees – your PostalEase LiteBlue account is your portal to much more than just your earnings statement
TSP Loans
/by Dianna TafazoliThe Thrift Savings Plan (TSP.gov) is a savings, retirement and investment vehicle available to federal and postal employees. Although different guidelines for FERS and CSRS, the TSP loans are nonetheless a supplement to grow your retirement wealth and retirement income.
Your TSP.gov account is structured so that participants may take out TSP loans from their TSP.gov account. There are two types of TSP loans – a general purpose TSP loan which has a 5 year term limit and a residential TSP loan carrying a 15 year term. You can change the amount of your payments up or down (re-amortize) as long as it is within the period or term of the TSP loan.
Individual borrowers are responsible for making TSP loans payments on time. It is important to always check your quarterly participant statement to make sure your TSP loans payments are being made and made on time. Generally TSP loan payments are payroll deductible; many things might happen that can change when the payments are being deducted. Your pay cycle may change or you may transfer to another agency or assignment and deductions from your pay may be delayed. It is still your responsibility to make sure the payments reach your TSP.gov account in a timely manner. You may pay by personal check or money order directly to the TSP with a payment coupon (TSP-26). Include your TSP loan account number, your loan number and the TSP-26 to make certain that you are properly identified and payments are credited to your account.
Missing a payment on your TSP loan could have tax consequences. If you do miss a loan payment the TSP loan will notify you of the missed payment and you will have until the end of the following calendar quarter to rectify the problem. You cannot suspend your TSP loan payments nor stop them. If you witness a financial hardship, you should consider recalculating (re-amortize) your TSP loan to an amount you can afford.
TSP Loans
For information on TSP Fund choices click here
P. S. Always Remember to Share What You Know.
RELATED TSP ARTICLES
Thrift Savings Plan (TSP) Withdrawal Options
For Postal Employees – LiteBlue and the TSP
Federal and Postal Employees – Choosing a Financial Professional
Is All ‘Your’ TSP Money Actually Yours?
Thrift Savings Plan: Saving for Your TSP
/by Dianna TafazoliSaving for Your Thrift Savings Plan
Funding your Thrift Savings Plan (TSP) account through TSP.gov, with the specifc goal of getting the maximum benefits, is a good goal to set. The IRS sets a limit on how much federal employees can contribute to the TSP. The great design of the TSP is that agencies participate in a matching scenario. Although the IRS sets a limit on contribution levels, the rule of thumb is to make certain you don’t reach that limit too early and miss out of the agency match paid over 26 pay periods in a year.
Paying attention to your TSP matching contributions is possibly even more important than what TSP fund you select. This is because the TSP match can act like ‘Free Money’ because for every dollar you contribute (up to the maximum match) your Agency contributes an identical amount to your TSP. – Its like doubling your money, Day-One.
You can also wait too late to get all of your matching benefits of our TSP accounts.. Therefore, you want to pay close attention to your contribution levels and the time it will take to reach the maximum limit and still receive matching funds. This situation is of particular concern if your salary changes. The level of contribution necessary to reach your maximum contribution changes depending on your salary.
If you set out to reach your contribution level too quickly called front-loading, you run the risk of reaching the level prior to the end of the 26 pay periods; depriving you of the maximum agency match. It is important to watch your TSP contribution levels so that you can contribute your 5% in all 26 pay periods to get the TSP match the agency offers.
You can also visit your agency TSP.gov representative or go online at and view your TSP.gov Account to see how much you need to contribute each pay period to make certain you are not reaching your contribution limit too early in order to realize the agency’s 5% TSP match.
P. S. Always Remember to Share What You Know.
RELATED TSP ARTICLES
Thrift Savings Plan (TSP) Withdrawal Options
For Postal Employees – LiteBlue and the TSP
Federal and Postal Employees – Choosing a Financial Professional
Is All ‘Your’ TSP Money Actually Yours?
Thrift Savings Plan: Why The TSP?
/by Dianna TafazoliWhy choose the Thrift Savings Plan?
The Thrift Savings Plan (TSP) is a retirement savings vehicle designed to help federal and postal employees increase their resources when planning for retirement. But why not take your earnings from the federal government and take your chances in the open market? Maybe you could do better and your money could grow faster or maybe not.
The TSP is an easy way to save with little or no strain and stress on the employee. TSP contributions are payroll deductible once you sign up to participate in the TSP. The TSP offers extremely low administrative fees which external investment firms cannot match. Vanguard which has probably the lowest expense ratios available to investors are still higher than the expense ratio for the Thrift Savings Plan.
Your TSP Account also provides a fund where you will never lose money, the TSP G Fund. The G Fund, Government secured allows participants to earn interest without any risk or loss of principal. There is also very low earnings in the G Fund with only very modest inflationary protection (speak to a TSP expert or licensed and trained financial professional).
So why the TSP, because it offers participants the best way to safely plan for their retirement future while still employed. If you know what the rule of 72 is and how it related to compounding interest; interest built on top of interest that helps your money grow faster. That is yet another advantage offered by the TSP is the fact that while your money is within it or rolled over into an IRA your TSP interest and earnings are tax-deferred.
With the TSP you get to choose the level of contribution you wish to make. Although, employees currently joining the federal service are automatically enrolled in the TSP at a contribution level of 3%, you have the option of disenrollment. But why would you want to? The TSP is hands down the best way for federal employees to start early managing their retirement future.
To access your TSP Account click here
Click here for TSP Roth information.
Have a TSP L Fund – want to know more
P. S. Always Remember to Share What You Know
TSP: Is All ‘Your’ TSP Money Actually Yours
/by Dianna TafazoliIs All Your TSP Money Yours?
Within your TSP.gov Account the money you invest in the Thrift Savings Plan (TSP) and the agency match is yours immediately and you are therefore vested. However, the agency’s automatic 1% contribution has a few strings attached.
For individuals in the Civil Service Retirement System (CSRS), this is not a concern. CSRS employees may participate in the TSP but are not eligible to receive any matching funds. Nonetheless, it is still a useful tool for deferring taxes and helping to save for retirement. Your TSP.gov Account acts as a supplement for CSRS employees in planning their retirement.
FERS employees on the other hand receive matching funds into their TSP.gov account along with an automatic 1% contribution. FERS employees are eligible to keep the 1% contribution after becoming vested by acquiring tenure of at least 3 years with the Federal Government. FERS employees who work in the Congress and certain other non-career employees need only 2 years to become vested in the Thrift Savings Program.
If you are participating in the Thrift Savings Program and decide to leave the federal service prior to the 3 year vesting period, the automatic 1% and the earnings from the agency 1% contribution will no longer be yours to keep. However if you die before leaving service you are vested in all the monies in your Thrift Savings Program account.
Your TSP.gov account (see your account here) is a wonderful vehicle for not only managing taxes but helping federal and postal employees save for retirement.
P. S. Always Remember to Share What You Know.
You may also find information on your TSP Funds interesting, or certain Tax implications of your TSP.gov investments.
RELATED TSP ARTICLES
Thrift Savings Plan (TSP) Withdrawal Options
For Postal Employees – LiteBlue and the TSP
Federal and Postal Employees – Choosing a Financial Professional
(TSP) Thrift Savings Plan
/by Dianna TafazoliThrift Savings Plan (TSP)
The Thrift Savings Plan (TSP) is a program created to help federal employees save for retirement with an investment arm through payroll deduction. The Thrift Savings Plan is a defined contribution plan, a key part of the Federal Employees Retirement System (FERS). As of 2010, employees are automatically enrolled in the Thrift Savings Plan with 3% of their basic pay going into the Traditional Thrift Savings Plan. The agency contributes an automatic 1% with a 3% matching contribution. Employees who are automatically enrolled in the Thrift Savings Plan can choose to withdraw from participation.
When the automatic inclusion into the Thrift Savings Plan was implemented, those funds were deposited into the G Fund. The TSP G Fund represents government securities in the diversified portfolio of the Thrift Savings Plan. The G Fund is the only fund that is internally managed by the Thrift Savings Board. The G Fund never loses money. After being automatically enrolled in their TSP.gov account, participants may contact their agency representatives to choose to allocate their funds at their discretion among the TSP L Fund (age-based combinations of other TSP Funds), the C, S, F and I Funds. These funds are contracted out and managed by Black Rock Institutional Trust Company.
The Thrift Savings Plan is, of course, operated through payroll deductions meaning you can no longer make contributions when are not an active employee either full or part-time and in a pay status. As a retiree, with an established TSP.gov account, you can participate in the Thrift Savings Plan interfund transfer feature.
The Thrift Savings Plan also accepts funds from other eligible plans. The Traditional Thrift Savings Plan accepts transfer and rollovers from Traditional IRAs and Simple IRAs. The Roth TSP accepts transfers from the Roth 401(k), 403(b), and the 457(b). The Thrift Savings Plan does not accept transfers and rollovers from Roth IRAs.
The Thrift Savings Plan is managed by the Federal Retirement Thrift Investment Board (FRTIB) made up of 5 board members appointed by the President of the United States and an Executive Director. The FRTIB also has an Advisory Council, the Employee Thrift Advisors Council (ETAC) made up of employee organizations, unions and the uniformed services.
The Thrift Savings Plan, although a part of the FERS retirement plan, it also is a vehicle that can be used by CSRS employees to plan for retirement. There are no matching contributions made to the Thrift Savings Plan for CSRS employees.
To access your TSP.gov Account click here
Postal employees can access their Thrift Savings Plan through LiteBlue
P. S. Always Remember to Share What You Know.
RELATED TSP ARTICLES
Thrift Savings Plan (TSP) Withdrawal Options
For Postal Employees – LiteBlue and the TSP
Federal and Postal Employees – Choosing a Financial Professional
Is All ‘Your’ TSP Money Actually Yours?
Tax – Deferred Advantages
/by Dianna TafazoliWhat do tax-deferred instruments like the Thrift Savings Plan do for federal and postal employees? Most importantly, the instrument can give the employee a larger amount of money to take home. Taxes are calculated against your earnings on a pre-tax basis. For example, if you earned $1,000 and placed $200 in your Thrift Savings Plan (TSP) account, instead of paying taxes on $1,000, you would only pay taxes on $800 and the $200 would be deposited into your account for later use. This scenario would give you more because less money is being deducted from your earnings today and your $200 would be invested for later use.
Is a tax deferment election the best choice for every federal employee? This is a situation that requires evaluation of one’s individual circumstances. Prior to the expansion of the TSP’s structure, a tax deferred program was the only option available. Now participants in the Thrift Savings Plan can decide to defer their taxes via the Traditional TSP or pay taxes up front via the Roth TSP.
The Traditional Thrift Savings Plan allows you to defer taxes and only pay the taxes when the funds are withdrawn. The Roth TSP requires paying the taxes up front which eliminates having to pay taxes when the funds are withdrawn. The Roth TSP also allows for tax-free earnings when certain conditions are met.
Employees can now see if the Traditional TSP or the Roth TSP or both fit into their plans to retire well and meet their individual needs. Visit your TSP.gov Account to review the information on the TSP and how it helps in planning your retirement future.
P. S. Always Remember to Share What You Know.
It is also important to review your TSP fund selections and make sure that your reaching your retirement goals
Financial Advisors and Federal Employees
/by Dianna TafazoliI was recently asked if my trainer of financial advisors and planners interested in the federal workforce differed from training federal workers? Without missing a beat, I said most emphatically “It certainly does.” It is more intense because financial advisors for federal employees need to know more about the Federal Retirement Systems than the federal workforce themselves.
The Federal Retirement Systems probably have some of the best benefits you will find all things being equal. It, too, is a system of immense rules and regulations that can be undeniably complex, even for someone who has spent a career absorbing all of the nooks and crannies.
The Civil Service Retirement System (CSRS) often referred to as the old retirement system was enacted in 1920. The world has changed a number of times since then and many amendments have been made to the system. One must be constantly updated on the changes so as to be an excellent source of information dissemination. I find that many financial advisors and planners I work with who wish to begin helping the federal workforce think of simply helping the workers manage their money. There is nothing wrong with that premise only that would leave the federal employee missing out on a great number of potential benefits
Federal Employees Partnering with Financial Advisors
Financial Advisors and Financial Planners (really the same thing) are important pieces of the partnership needed to guide the federal employee workforce to safe harbor so that their sails can withstand the uncertainty of storms that will surely come in their lives. To strategize such a journey requires acquiring a very sound knowledge of the Federal Retirement Systems (FERS, CSRS, FEGLI, FSAFEDS, etc.).
We are not talking about becoming Federal Retirement Specialists, but we are talking about partnerships that will equip these professionals to help manage the financial resources of a very unique group of employees. When you cast your net to work with the federal workforce in helping to plan their retirement, it needs to be cast wide because federal employees are as diverse as their many duties and responsibilities.
Although there are two retirement systems technically, there are a number of aspects that apply to special categories of employees as well, like firefighters, air traffic controllers and law enforcement officials.
Yes, my approach to conversational training with financial professionals is much more intense and absolutely focused on ensuring they know the language of the federal retirement systems and its workforce so that they can give them the tools necessary to retire in comfort and security.
If the federal workforce gets a course in the basics of the Federal Retirement Systems, then the professionals they entrust to handle their hard earned money – get the ADVANCED-ZERO TOLERANCE version with lots of hand-holding collaboration. I learn as much from Financial Advisors and Planners as they learn from me. We are all invested in making life in retirement and before a little easier to maneuver for federal workforce.
Financial Advisors who are knowledgable in federal and postal benefits need to be able to help you with your TSP account and Thrift Savings Plan fund choices, your Federal Employees Group Life Insurance (FEGLI) selection (both while employed and any potential reduction elections that you might want) and also possibly help you with your FSAFEDS and FEHB elections.
P. S. Always Remember to Share What You Know.
Recommended Articles
For Postal Employees – LiteBlue and the TSP
Federal Retirement Benefit Analysis
Is The Pension Survivor Benefit Best For You? by Todd Carmack
A Little-Known Opportunity Can Increase Your Retirement Income. by Mark Sprague
Plan for Pre-Retirement Debt Reduction
/by Dianna TafazoliDebt Reduction Plan
By now your laundry list of things to do as you prepare to Retire Well should be growing. There are a lot of things we want to take into retirement with us, but one thing we want to leave behind is HEAVY DEBT. Since most of us will be living off of an income that is decidedly less than what we earned as active employees, reducing our debt is a key laundry list item.
Unlike our parents and grandparents, our mortgage obligations may not be retired when we retire. Therefore, taking that debt into retirement may be unavoidable. The good news is that you might be able to trim the cost of your mortgage. One way of doing that might be to downsize, since the nest might be empty and the space you once needed while raising your family may no longer be needed. There are also other choices and options concerning your mortgage liabilities that you may want to research and examine to see if they fit your lifestyle and budget. Some of those options will be discussed in subsequent posts.
As for now there are many steps we can take to reduce our debt. First step, identify and categorize your debt as small, medium or large in terms of the balance owed. Second, we are going to evaluate the interest owed on all debts. Third, we should analyze how long we have been carrying the debt. The fourth step is to assess what percentage of your debt is comprised of NEED and what percentage is comprised of WANT.
Once you have taken the suggested steps, then begin to pay down little, small, nagging debts no matter the interest rate. After you have taken care of that, begin to pay down the debt that has the highest interest rate first because the more interest you have to pay out, the more of your hard earned money you are handing off to someone else. Then follow through by paying the remaining debts with lower interest rates. The key to making your debt reduction plan work is once you begin to pay down the debt take care not to accumulate additional debt. Dividing your debts into things you purchased because you needed them versus things you wanted, will help you avoid impulse spending.
Regardless of whether you are eligible for CSRS or FERS, part of your Retirement Plan should be to make sure you have as little debt as possible (and hopefully one at all) as you enter retirement. Think about establishing a debt reduction plan at least five years before you retire so that you can get a handle on how to use your restructured income to enjoy some of the things you wanted to do that were otherwise restricted by your commitment and obligation to work.
P. S. Always Remember to Share What You Know.
Click HERE for information on TSP.gov
Click HERE for information on LiteBlue
Click HERE for information on Retirement Planning
Plan Building: How Do I Get Started?
/by Dianna Tafazoli~~HOW DO I GET STARTED WITH A PLAN?
By now you are probably asking – How do I get started setting goals that are SMART and putting a plan into action? You get started by first simply writing down what you desire your retirement picture to reflect. Write down your goals, evaluate and analyze them so they fit your circumstances and values.
Create a strategy that is doable with short, intermediate and long-term goals with time horizons that are based in reality. Make certain that the plan you create can be put into action without causing undue stress on your emotional and financial well-being. Lastly, make room to monitor and track the movement of your plan, leaving time and space to modify the plan as circumstances and conditions change in your life both for you and your family.
A plan that starts out SMART ends with giving you in retirement the lifestyle you desire and deserve.
P. S. Always Remember to Share What You Know.
The Chief Executive Officer (You, the CEO)
/by Dianna TafazoliYou, the CEO
Organizations have many layers of responsibility. However, the organization’s failures or successes rest in the hands of the Chief Executive Officer, the CEO. The BUCK stops with YOU, because you are the CEO of the Business of Your Life.
You have to take charge by prioritizing the steps necessary to ensure the success of the Business of Your Life as you move into retirement. CEOs inquire about what they need to know in order to ensure long-term viability of the organization’s resources. As the CEO (YOU) of the Business of Your Life, it is time for you to establish an open and frequent line of communication with your Human Resources Office.
Make sure that your service computation date is correct as well as your FEHB and FEGLI elections verifying at least 5 years of participation. Meeting the five year requirement enables you to take your FEHB and FEGLI into retirement.
Consider letting the last two years prior to your planned retirement year, be a period of investigation and examination of your work history profile to avoid surprises as you draw closer to your targeted retirement year. Give yourself time to process the information you have gathered to determine the level of utilization and implementation.
Once you have made your inquiries, gathered and assembled critical information, processed the information to determine the right fit for your retirement vision, you can then begin applying what you have learned from your research and investigation.
Determining the right fit for your retirement vision is highly customized. Your retirement future is not a cookie-cutter phenomenon, but a challenge and an opportunity unique to your circumstances, needs, values and choices – The Business of Your Life. Applying what you have learned means making it happen, making it real and making it work. It’s up to you to make it happen – the BUCK stops with YOU- the CEO.
P. S. Always Remember to Share What You Know.
Tips to Getting Your House in Order to Retire Well
/by Dianna Tafazoli~~Sharing Information
Pension systems and retirement plans often have many provisions that can be challenging to navigate and understand, the Federal Retirement Systems are no different. However, sharing information and provisions of your retirement system with spouses, partners and family members are important.
There are questions to be considered when putting plans in place for retirement, be it at the end of one’s career or at the beginning. Sharing information is key to proper planning.
• Are the people involved in your life appropriately aware of your financial picture (your Thrift Savings Plan, FEGLI selections, Last will, etc.)?
• Do they share the same financial values, objectives and goals as you?
• How will the loss of your income impact their ability to independently handle finances?
• If you’re a postal employee – have you printed out and saved copies of your LiteBlue.usps.gov information?
• Has there been a discussion as to the location of important documents and files including any TSP withdrawals?
• Do they know who to contact in the event of a tragedy at your place of employment and what action to take concerning your benefits?
• Have you talked with them about your Thrift Savings Plan , your Annuity, how much they might receive from your (FEGLI) life insurance and who your beneficiaries are if you were to pass?
Whether you are single or married everybody needs someone they trust to know these things. Sharing information with these trusted individuals ensures fewer details are missed. Everybody needs a partner when it comes to planning the business of our lives and for planning for the safety and security of retirement.
P. S. Always Remember to Share What You Know.
Access your TSP.gov account from here
Can I Choose My Own Retirement Date?
/by Dianna TafazoliCan I choose my own retirement date?
Is there a best day to retire? The answer is yes, but with some qualifiers. Choosing a retirement date should certainly be of your own choosing. However, there are some important factors to consider when choosing the best retirement date, like are you getting the maximum benefit available to you.
To be on the safe side, it is a good rule of thumb to visit your human resources office where your employment records are kept to discuss best options for your retirement date and other subjects. Your human resources office should be able to determine if you meet the age and length of service requirements based on the date you have chosen. It is good to select a number of potential retirement dates so that you are not disappointed if the first choice is not to your advantage.
The human resources office will not only help you choose the best day to retire but will speak to you about when your annuity payments will begin based on the selected date of retirement. They will also counsel you if you do not meet the age and service requirements and help you understand how the additional requirements can be met. Human resources cannot, however, help calculate how your TSP account balance or help you make TSP related decisions, or any other savings may impact your decisions about retirement. You will need to talk with a financial professional who is also an expert in your benefits for that type of calculation.
For example, under the Civil Service Retirement System (CSRS) if you retire between the 1st thru the 3rd of the month your annuity will begin the following day and you will receive your check on the 1st of the following month. If you retire on the 4th and after your annuity will begin the following month and you will receive your check on the 1st of the next month. Example: Retiring on the 4th of October and after, annuity begins in November and you will receive your check in December. There is a remarkable time difference based on when you retire. Therefore, knowing when to retire is very important information to have at your disposal.
The annuity begins the 1st day of the following month for employees retiring under the Federal Employees Retirement System (FERS). Having the right information, carefully evaluating all of the available information (including TSP allocations, etc.) and selecting options that offer you the greatest benefit is without question the best date to retire well.
P. S. Always Remember to Share what You Know.
What should you do 1 Year before Retirement
Postal employees should regularly check their LiteBlue information (FEHB, TSP.gov allocations, etc.)