FEDERAL WORKERS MATTER

The federal workforce, including the postal service is said to represent a population of about 2.1 million strong, the largest workforce in the world.  The Government Accountability Office (GAO) reported that approximately 30% of the federal workforce would be eligible for retirement in 3 years.  Federal employees can retire at age 62 with five years of service.  They can retire even earlier with 20 years of service.
According the Office of Personnel Management (OPM) during the first four months of 2013, 60,000 federal workers filed for federal retirement benefits, signaling a 43% increase from 2012.  OPM also reports that the jump in application filings is also due to postal workers taking early retirement buyouts.
We are all aware of attempts to trim the budget and right-size government.  The trend in baby boomers leaving the federal workforce is also highlighting the institutional knowledge that is leaving with them across every discipline.

Retooling succession planning strategies and employing tag-along protocol (pairing new employees with seasoned employees to safeguard continuity of institutional knowledge) will help to plug the gaping hole and run off of critical institutional knowledge so necessary in moving the nation’s business forward.
That being said, too many federal workers leave the service with the stigma hanging over their heads that they are lazy and do not make significant contributions to the goals of our society.  They are often mistakenly labeled as ‘takers’ and not ‘givers’.

This conversation alone should be a great dispeller of the erroneous myths about federal workers.  The conversation should also cause federal workers to lift their heads high and applaud the contributions they have made and continue to make to promote the goals of the nation’s business.
Federal workers do matter because if we didn’t have the hugest workforce in the world willing to be a part of that force, the country would not be able to fulfill some of its most important goals.  Work objectives seem to always gain steam from collaboration and input from diverse sources. The coming together of ideas from the public and private sector makes good business sense.  The private sector can never outnumber public sector resources, but together they can bring variety to the table and build upon the goals of the nation’s business.
As federal and postal employees leave the workforce in great numbers, we join the nation in applauding their work for staying the course.  Federal workers matter!!!!

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

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NEWSLETTER WEEKLY- CLASS IS IN SESSION
We talk a lot about what needs to be done so that you can retire well.  We recommend a whole battery of things to do, a laundry list of sorts, because we embrace and share your goal to retire well.  Hopefully by providing some directions and information your plans to retire well will be enhanced.
I suppose sometimes, it feels as if you are hearing a lecture and being given an assignment to complete with only a short time to do it.  Even if you are just beginning to prepare for retirement and you only have a few years left before reaching your targeted retirement date, don’t despair.  As long as you get started, then you are on track to retire well.
Each of us has a vision for our retirement future.  It is our gift to ourselves to make that vision a reality.  The good news is that making our vision a reality is very, very possible.  A 2005 survey conducted by Fidelity Investment revealed that more than 57% of retirees surveyed wished they had done more planning before they retired.  The survey also indicated that 60% of the surveyed population reported living the lifestyle they desired.
There is an immeasurable lesson in that survey for those facing retirement today and those facing retirement in the future – PLAN so that you can live the lifestyle you desire.  You owe it to yourself to RETIRE WELL.
P. S.  Always Remember to Share What You Know.

~~NEWSLETTER WEEKLY – WINTER RETIREMENT SUMMIT

I had the wonderful opportunity to receive an invitation to attend and cover for this newsletter the 2014 Winter Retirement Summit sponsored by the United States Securities and Exchange Commission (SEC) and the American Retirement Initiative Program in the nation’s capital on February 4, 2014.
While we realize that understanding the entire arena of retirement issues, questions, anticipation and anxiety associated with retirement is more critical today than ever before, we still need to take action to meet the new challenges we face as part of the retirement community.  It is true that the average American is earning more money today than their parents ever dreamed of earning; yet, they are saving less towards retirement.
The fact that Americans are saving less is troubling given we are living longer, some experts suggest as much as 30 or more years after retirement.  Given Americans are living longer, then their financial resources must work harder and smarter to outlast them.  The converse is that the burden of being under-resourced will ultimately become the burden of family, government institutions or both.
It is, therefore, a matter of national urgency, that retirement educators and human resources offices prioritize and redouble efforts to get the largest workforce in the world (federal and postal service workers) to fully and completely understand how their benefits work in retirement.
The Winter Retirement Summit opened by Mr. Keith Green, President of the American Retirement Initiative with welcoming remarks from Dr. Luis Aguilar, Commissioner, United States Securities and Exchange Commission, reminded the audience of the importance of savings and preparing for retirement through consistent education.
The literature in handouts also demonstrated that an increased emphasis on retirement is needed.  It also indicated that a great seriousness should be placed on getting employees to maximize their contributions to the Thrift Savings Plan (TSP), the government version of the 401(k) plan.  Additionally, the literature further stated that a major barrier to maximizing participation in the TSP is the lack of education about how these plans work.  This statement alone simply reiterates the underpinning importance of educating the federal work force in understanding how their benefits work in retirement.
In our most recent posts on the Federal Employees Group Life Insurance (FEGLI), we discussed, among other critical aspects of FEGLI, the need to understand how all benefits offered to federal and postal employees work to build a more secure financial retirement future.  Understanding the TSP and how consistent participation, fully maximizing employee contributions, whether you are CSRS or FERS, are primary components to making your resources outlast you.
We will continue discussing (in many a future newsletter) the many faceted areas of retirement to assist federal and postal employees in gaining the knowledge and information needed to retire well. Stay up to date by following our future newsletter posts.
P. S.  Always Remember to Share What You Know.

FEGLI: CELEBRATING A LIFE WELL-LIVED

As I thought of our discussion about FEGLI, LIFE insurance coverage for federal and postal employees, the word LIFE kept jumping out at me.  Although many of us think of life insurance primarily as death insurance, it really is insurance about LIFE.

FEGLI life insurance provides the policy holder with peace of mind and the comfort of knowing that the expenses necessary to celebrate the final journey of a life well-lived will be covered without family having to incur out-of-pocket expenses.
As such our discussion of life insurance is one of the critical components of what is needed to retire well.  We have laid out the types of coverage, Basic and Optional, provided through your Federal Employees Group Life Insurance along with the provisions and the ability to transport coverage into retirement.

There is always the question of how much life insurance is needed.  Although the answer to that question is as varied as the diversity of our individual needs, the common thread is what you need life insurance to do for you and your family.
Of course, there is the obvious, and for each of us, there will be individual desires and personal goals to fulfill.  Whatever our need for life insurance, it is important to understand what our coverage entails and what it means in retirement.  One thing we must take note of is that no increase in coverage can be made in retirement.

If your planning hinges upon needing additional life insurance to secure your individual goals, make it a part of your pre-retirement check-up list.  We will provide a suggested pre-retirement check-up list, things to do before you retire in an upcoming post, to assist you in the planning process.

It feels good when you know you are putting your plans in order to protect yourself and your loved one.  You are on your way to setting the course to retire well.
P. S.  Always Remember to Share What You Know.

RECAP – FEHB AND MEDICARE

We have discussed a sizable amount of information on the Federal Employees Health Benefit (FEHB) plan and its parallel to Medicare.  The FEHB plan covers the largest number of individuals in the world, including active and retired personnel.

The premium rates paid by employees for individual and family coverage is affordable in a highly competitive market.  Federal employees enjoy not only some of the best benefits available, but the best rates as well.

Premiums change annually, along with plan offerings; allowing employees to examine and evaluate their plans and plan affordability during open season.  Retirees participate in open season, the same as active employees, making changes and adjustments to fit their needs.

Many retirees carry health coverage of a higher-tier and cost to ensure all their health care needs are met.  FEHB, in many instances, include dental and vision, and of course, an unrivaled prescription drug plan. However, when federal employees reach the age of Medicare eligibility, Medicare and FEHB draw a strong parallel  – covering many of the same services.

Reaching the age of Medicare eligibility brings you to a good place to begin analyzing your FEHB health plan to determine if your circumstances merit looking into a plan with lower costs while providing a diversity of services. The reason being is that Medicare covers some of the same services offered by your FEHB plan.

As a retiree, your income may be slightly less than when you were an active employee.  As such you may want to streamline your expenses as much as possible to increase your available income.

By lining up side-by-side the services covered under both Medicare and FEHB, you can choose an FEHB plan that does not duplicare the services of Medicare; but provide all the coverage you need between the two.  This will enable you to choose an FEHB plan with a lower cost and save you money.

For example, FEHB prescription drug plan is among the best on the market, so Medicare Part D (prescription drugs) is not needed for most retirees when they have FEHB.

Medigap policies are generally entertained to close the gap between what your plan offers and what it does not.  Having Medicare and FEHB eliminate that concern.  Also, if you choose a Medicare Advantage Plan, there is also no need for a Medigap policy.

Educate yourself about the health care options available to you in retirement so that you get comprehensive health care coverage with little or no additional out-of-pocket expenes, while still saving money.

Retirement can be the best time of your life because you are in control of your time and the choices you make about what your life will look like in retirement.  Gather, analyze and assess all the information available to determine what fits your needs. Make sure you use your human resources office to receive and understand valuable information about your retirement options.  Educate yourself and your family and do something magnificent for yourself – RETIRE WELL.

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

I started doing retirement seminars

Many years ago when I started doing retirement seminars for federal employees in the Civil Service Retirement System (CSRS) and the Federal Employees Retirement System (FERS), I thought it would be a simple journey.  I would tell the audience how their benefits would work in retirement and dispel their fear.  They would ask some questions and then it would be done.

I would have no attachment to this group of strangers and they would certainly have no attachment to me.  These strangers came from all over the country, different groups twice a month, to entertain the idea of retirement and walking into a new season of their lives.

My premise was not based in reality.  Those seminars transformed my life and connected me to strangers in a way I never imagined.  I have always had a big heart and capable of loving even my enemies.  But there was something uniquely special happening right before my eyes.  We were embarking on a journey and I felt responsible to take the audience to safe harbor, but not in the way I had envisioned.

The first day of the first seminar of many, I looked out into the audience of faces I had never seen, yet I felt as if I knew them.  As my assistant made last minute adjustments to get me ready to formally meet the audience, I kept trying to figure out what was going on in the eyes of my waiting audience. Then as the interactively designed seminar got on the way, it suddenly hit me that they were afraid and I felt all of their fear rush to the podium like a heavy blanket.

The seminar I had planned began to take on a new face, a different direction – not a battery of technical information from defined benefits plans to defined contribution plans.  My audience of strangers was real people, with real families and real concerns, issues and problems with a defined amount of time to bring it altogether and make it work in retirement.  Americans are living longer, and many actuary reports state that the average American will live perhaps another 30 years after retirement.

Those strangers quickly became individuals whose stories and faces will forever be etched in my heart.   After spending nearly a week together, Fridays became bitter-sweet moments of departure.  Through the hugs and tears, we departed with the bitterness of separation, but with the sweetness of knowing we had given our all in the seminar by having presented the tools needed to approach retirement with confidence and courage to retire well.  The greatest gift one human being can give to another – is the gift of knowledge and information.

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

Anticipating Retirement

There is one question that stands out in the minds of every single person anticipating retirement – Will I Have Enough Money to Manage My Expenses and Maintain My Life Style?

Retirement is almost certain to mean for most of us living on a reduced or fixed income.  A reduced or fixed income does not mean a reduction in expenses, although that would be the preferable scenario.

During the course of the week we introduced 2 out of 10 of the most important things potential retirees need to do in order to retire well.  Over the next few weeks, we will continue the discussion of the remaining 8.

In addition, we also introduced tips to getting our house in order to retire well.  We discussed best dates to retire, the impact of sick and annual leave on retirement, and a simple formula for estimating income amongst a menu of diverse topics relevant to federal employees.

Baby boomers face challenges in retirement that many of their parents never did.  Specifically, when most of our parents retired after 30 years of work, so did the mortgage.  A large number of baby boomers will most likely take a fairly hefty mortgage into retirement.  Therefore, we must be smarter than ever about handling our finances and living on a reduced or fixed income.

The last years prior to retirement, particularly the last 5 to 10 years, should be spent paying down debt, not accumulating debt.  We should strive to take as little debt as possible into retirement.  Consideration should be given to paying off high interest debts first, followed by debts with low interest and then getting rid of nagging expenses that carry a small balance.  Consider a campaign with a time horizon to pay them off.

Paying off your mortgage at once would be wonderful if you had the disposal income to do it.  But for some, perhaps it is not so wonderful because of tax considerations and write-offs.  As for credit cards, you cannot be tempted to use them if your don’t have them in your wallet when strolling through a mall.  People who work in marketing spend many hours finding ways to get us to open our wallets and spend our money.  We can’t blame them, they are doing their jobs and doing them well.

Overall by beginning to consciously make a realistic list of wants versus needs and prioritizing needs over wants will help reduce debts going into retirement and post retirement.  There are many challenges facing retirees, but having a plan when anticipating retirement makes these challenges easier to overcome.  There are also many opportunities for implementing strategies that can help you retire well and live in comfort and security.

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