Private Life Insurance Considerations of a Government Employee
Federal Employees’ Group Life Insurance (FEGLI) is an excellent choice for specific government employees. However, there are a few reasons employees may opt to purchase private insurance as they age instead. If the federal government has ever employed you, you may have some understanding of how FEGLI benefits you and your coworkers.
FEGLI stands as one of the most comprehensive employer-provided insurance programs in the United States. Like term life insurance, FEGLI doesn’t earn interest or build cash value. Upon employment, government employees have enrolled in the program automatically, with extended coverage until they choose to opt out. But what are some of the features of a FEGLI policy?
- Plans Offer Lower Coverage Limits
With an amount less than seven times your salary, FEGLI policies max out at five times your yearly salary. - Rates Increase after the Age of 50
If you start when you are younger, you can enjoy cheap premiums. However, as you age, policy rates increase with time. - Coverage Decreases at Retirement
Most insurance plans offered by an employer do not allow policyholders to keep their plans after retirement. This is where FEGLI is unique; however, even the basic FEGLI plan will decrease in coverage upon retirement.
You must look into the coverage options set forth by your chosen FEGLI plan. Please note that just because you received automatic enrollment doesn’t mean it is tailor suited to your needs. Even the private insurance marketplace has various cost-effective options for more efficient policies. Consider contacting a federal retirement consultant to determine whether a FEGLI plan is right for you or help you find something in the marketplace instead.
Contact Information:
Email: [email protected]
Phone: 7705402211
Bio:
Mack Hales has spent the past 4 decades helping clients prepare for retirement and manage their finances successfully. He also works with strategies that help clients put away much more money for their retirement than they could in an IRA or even a 401k. We involve the client’s CPA and/or their tax attorney to be sure the programs meet the proper tax codes.
Mack works with Federal Employees to help them establish the right path before and after retirement. The goal is to help the client retire worry-free with as much tax-free income as possible and no worries about money at risk of market loss during retirement.
Mack has resided in Gainesville, GA since 1983, so this is considered home. Mack is married to his wife of 51 years, has two boys and five grandchildren.
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.
