Class of 2021
As the saying goes, “The days are long but the years are short.”
Here we are again, at the end of another year.
For those of you who are new, this is the popular “Class Of” article, put out annually, and the one paper I don’t write. This is written by those that retired from the government in 2021. The Retiring Class of 2021. Man, am I jealous!
What’s the purpose? It’s simple. What they just walked through is what each one of you will walk through, hopefully. Some of you perhaps very soon. It’s always good to hear the examples of those that have done what you’re planning to do. To get their perspective. It makes things less scary.
The questions are mine. The responses are those of subscribers who sent in answers. I do not edit anything, other than removing names. You’ll see plenty of typos and grammar errors. That’s fine with me. The message is what’s important. No one’s sitting there with their hair up in a bun, grading this stuff with a red pencil.
Yes, it’s long. In fact, it’s very long. But some retirees have a lot to say. And this is their chance to give back so I don’t short them. Read it over multiple sittings if you want.
Enjoy!
(For purposes of readability, each bullet point is the start of a new individual’s answer. Not all respondents answer all questions.)
Did you retire at first eligibility or later? What were the reasons for leaving when you did?
I waited an additional 6 months to coincide with my wife retiring and to take care of some work things since retirement crept up so fast!
I also used the extra time to max out my TSP for the year and TSP "catch-up contribution" by spreading it out over the additional 6 months of the year.
I also accrued the extra annual leave that helped increase my AL payout check ($23K after taxes).
I became eligible for retirement in March 2021 and retired September 30, 2021 after being offered a $25,000 VISP, which had not been offered for eight years. I figured I better take the money and run two years prior to SCE mandatory retirement.
I retired five years after I was first eligible.
I retired when I achieved over 30 years of total government service (25 years in FERS- SCE).
I was also within six months of mandatory retirement and felt that I had achieved all my goals in government service.
I retired at first eligibility, August 31, 2021. I was blessed with a wonderful 37-year career. Reason number 1 for retiring; I was eligible and reason number 2; I had a toxic supervisor who created a hostile work environment the last two years of my career (keeping it real).
I retired at the mandatory age of 57. I truly enjoyed my unique position within not just my agency but the Federal government as a whole. I had always planned on mandatory as I knew 30 plus years would provide a comfortable pension and ample TSP growth.
I retired after 26 years of covered LEO service. I got passed over for promotion, so I knew it was time. I’m under 50 years old but planned on doing the “life expectancy” withdrawal exception to the 10% penalty before 59 1/2. If you don’t understand that last sentence, do the research and RETIRE!
We all work with colleagues whose job may be their identity, who may have a huge “Captain America” ego believing government cannot survive without them, who complain about the job every day, suggesting they are one phone call or work assignment away from calling it quits, but then offer excuses for why they can’t or won’t retire. We’ve all seen them being drug out of their offices on their last day kicking and screaming because their second or third extension request was denied. It’s these same people whose plaques cover an “I love me wall” in their office that end up in boxes stored in their basements after they finally retire. I was determined not to be that person.
From the early years of my career, I developed a financial plan to be able to retire at the earliest date of eligibility (for me what was age 50). Throughout my 25 years of service I watched with admiration colleagues who preceded me do the same, including those who decided to forego the opportunity to begin distributions from TSP at age 50 (for SCEs) and instead retired at ages 48 or 49. I began planning early so I too could be this person.
Planning means I do not need to work, yet if I chose to, I believe I am much more marketable for a second career at age 50, versus 55 or 57 (i.e., I have older friends who suggest they are being passed over based on younger applicants competing for the same post-government career jobs).More importantly, there is life after government.I never allowed the job to be my identity.
I retired two months after eligibility because I ran the numbers on my sick leave and realized if I stayed eight more weeks I could get credit for another percent. Two extra months was worth it to me and an easy sprint.
When I was eligible. Actually a few months past because I had to wait for my security re-investigation and polygraph for next job.
I retired about a year and a half after first eligibility. The job had become increasingly annoying, so I "ran the numbers" and decided that I could afford to retire.
I was eligible at age 56. I retired at 58. I decided to retire because I wasn’t enjoying the work anymore. Plus, I wanted to be young and healthy enough to travel, spend more time with my family, and take up some new hobbies.
What was the exact financial reason (and moment) you decided to retire, if you can point to one thing?
I've had it in my mind for a few years to retire at eligibility if the numbers were there.
I did lot's of online financial research along with a "mid-career counseling session with Chris Barfield" that honestly made me realize it could be done.
As the day got closer, I realized it would be sustainable to retire and continue living the same lifestyle financially as I had been doing while working.
VISP offer for end of the fiscal year.
Financially, I guess it was when staying wouldn’t have significantly improved my pension and my TSP was over a million.
I attended the Dave Ramsey Financial Peace University 7 years ago and realized if I wanted to retire when eligible, I had to be free from debt, live on a retirement budget, and max out my TSP. So, I made my decision 7 years ago I wanted to retire when eligible which was August 31, 2021.
I was going to get paid the same (with TSP monthly withdrawals) whether I was working or retired. Wait, they were going to pay me for just staying alive? So, why not do something else?
From the beginning of my career, I told myself I would retire at the earliest possible date of eligibility. I was able to keep my promise to myself through good financial planning and psychologically preparing myself over my final 5 years as I approached my 50th birthday. Here is an observation: Throughout our careers we’ve watched colleagues jockey for that preferred desk in a squadroom within hours of someone leaving government. Others purloin staplers, computer monitors, chairs, and other commodities from their desk often before they exit the building for the last time. Within days of leaving your agency will remove your name from the email system. Weeks thereafter colleagues aren’t necessarily wondering how you’re spending your time in retirement, but instead are talking about the new guy transferring in from another city to fill the vacancy you created, or the academy graduation date of a new recruit. Don’t be that person who becomes institutionalized in government service and is working for a fraction of your worth (i.e., the difference between a salary and an annuity). Regardless of what you choose to do (e.g., a second career, watch grandkids, travel, etc.) there are other chapters to live and write about in life. Consider taking advantage of the tremendous benefits afforded those in the federal workforce sooner.
One million in TSP.
Dan Jamison said you can do better. Did the math and calculations showed that I could pretty much do anything and come out ahead
I had more than one exact financial reason. After reading through the Fersguide and all the articles you and Dan Jamison wrote (over and over again) and using the retirement estimator, I realized I would be missing out on the Retirement Annuity Supplement for only a few dollars more a month in my pension. Also, I didn’t have much debt, was maxed out at a GS-13 step 10 and had a sizable TSP balance. Another big financial reason was having healthcare. We are so fortunate to have healthcare after we retire
Specifically regarding the retirement process, what would you have done differently? (Retire earlier/later, save more, learn more, file earlier, talk to more people, get more estimates, etc.)
I did not max out my TSP right away starting out as a GS7 but I could have. But I maxed it out within a few years.
So, I definitely would have maxed it out from Day 1 if I could do it again.
I also made the mistake that I'm sure many have done by playing around with my TSP too much - shifting the balance and contributions percentages to different funds - trying to time the market.
I absolutely realize that the best thing to do is to "set it and forget it."
Everything has gone smoothly so far. I have been retired 2 1/2 months and I received my AL payout, maxout payment and interim pension on time.
If I knew we were going to remain in a semi-telework status a little longer I may have stayed until the end of the year, but overall very happy with my decision to retire when I did.
I followed a plan established early in my career which I would encourage others establish to avoid excuses for why retirement is not possible (e.g., I still have kids in school, I need to pay for a wedding, my ex- took half of everything through a bad divorce, my house isn’t paid off, my old girl/boyfriend ran up my credit card balances, etc.). There are plenty of resources out there (e.g., FERS Guide, Barfield Financial, Tammy Flanagan, etc.) to help develop and fulfill your individual financial plan. Read and educate yourself liberally and plan accordingly.
In my case, I wish I could have saved more in TSP. I was a single mother, putting a son through college (paying cash).
I was well educated on the retirement process, I went to many retirement seminars (I began 5 years before my eligibility date), currently subscribe to NARFE, FERSGUIDE, Barfield Financial Newsletter, etc.
I was very lucky that in my first year on the job, a forensic auditor explained to me the importance of the TSP, long term growth, maxing out contributions, and never trying to time the market. He also directed me to roll over my city pension with a reputable investment firm that included a financial advisor as a provided service.
I’m happy with estimates, etc. A couple of things I would have done differently: 1) Copy my EOPF folder into a PDF, then not forget the password you used to protect it. (EOPF is gone after your retire, so an accessible digital copy is necessary for 2) Have a good handle on what your HIGH 3 salary is. It’s not as easy a formula as just whatever your grade is divided by three years. Your salary changes about twice a year, so you have look at all your SF-50s going back three years, then get your average. It’s tricky however; when OPM provides the useless 10 page booklet, you will know whether they get close to the HIGH 3 number that you compute. 3) Know what your SS Supplement is supposed to be. I had a friend that had his computation messed up by OPM and he’s being shorted $80 per month. That will likely take a long government time to rectify.
Nothing.
Nothing. Maybe put more in the TSP when I was just starting out. But it’s tough when you get assigned to San Francisco for your first office.
I would have maxed out the TSP every year and put all of it in the C fund.
The only thing I would have done differently is concentrate on the yearly maximum dollar amount you can invest in the TSP. I was always doing a percentage and could have been contributing more early on.
How is actual retirement compared to how you envisioned it to be? (Better/worse/more boring, etc?)
It is great. It is still setting in but the stress is definitely lower.
No more fighting traffic, checking my work phone all the time (especially at night and on weekends) for missed calls, micro-managing upper management with their usual do as I say not as I did agendas, early morning wake-ups for arrests and search warrants etc etc.
I can truly do what I want, when I want.
I’m regretting retirement due to boredom and not knowing what to do with myself. I was a SCE and used to working long days, nights, and weekends so not sure how to occupy my time as of yet. It's only been three weeks so I'm sure I will get a plan soon as I've been spending my time traveling.
Time has gone so quickly that this is a trickier question than you would think. Plus with Covid still spiking in places, I really haven’t traveled and have been catching up with things around the house.
I am loving being retired! I love the freedom and peace it has given me. I am able to whatever I want, when I want. As much as tightening the financial belt hurt 7 years ago, it was well worth it for me.
It is about what I expected. I left in May and have not yet gotten bored but do see it on the horizon. I am currently preparing paperwork to teach at various Federal Academies. After a year off, I might seek part time employment or volunteer work as well.
Be sad for anyone that doesn’t say retirement is awesome. You get so much more of your time and your life back. Besides, your “on the job” headspace is freed up to do whatever you want to. I tell former co-workers that I barely think about that phase of my life at all. It’s like a book whose page has turned. For some, the job was/is your identity. Not for me.
Throughout my career I worked a breakneck pace over long days, nights, weekends, and holidays, often making up for colleagues who didn’t work any LEAP. My retirement plan includes taking time off to decompress. I plan to do so through the rest of the calendar year. Since I retired at age 50, I have found that some days can be hard to fill because friends, family, neighbors, and colleagues of my same age are still working. Still, I have done (and planned through end of year) more personal travel this year than the sum total during the last decade of government service.
I had a great career and would not change my chosen path. Yet, I would not change my decision to retire at eligibility. In fact, I now seldom carry a weapon, concealed firearms card, or my retirement credentials. I haven’t joined social media groups comprised of retirees who post comments about their careers or the photographs from agency association conventions. And, I have never been interested in knowing what a former colleague posts that they ate for dinner.
I am so busy now I don’t know how I had time for a job before. I haven’t gotten a chance to even play golf.
It’s exactly how I envisioned it. Working with some stress. I take public transportation to work; no more sitting in gridlock. But wife is happier with the extra income. So overall it’s better. Never boring for sure.
It’s great! I have only been retired a few months but I am really enjoying it. I have been able to travel and be with my family. My stress level is way down and so is my weight!
If you don’t mind sharing, what was your exiting TSP balance?
$991K
2.2 million.
Just over 600K
$991k. Three months later it was up to $1,025,000
The first half of my career I was in most of the funds although only a small percentage in the G fund.
For the second half I was mostly in the C/S funds.
I never was in the L funds.
$830,000
1.5 million, it went down and is back to about 1.3 million.
I can’t imagine what it would have been if I hadn’t moved it around in 2008 and if it had remained all in C for the last 10 years or more. Still should be more than enough.
My current TSP balance is $387,059. I also have a brokerage account with Fidelity and I have a savings account with emergency funds that covers a little over six months of monthly living expenses.
About 1.27 million. 26 straight years of maxing out averaging 75% C Fund. I did take two TSP loans during my career (about $15k each).
TSP = $1.3M, personal brokerage = $1.7M
$1,040,010
Just a tad over 1 mil. Plus I had a roth on the side, maybe $200,000.
My current balance is 1.1 million
I know we could always use more money, but specifically, do you think your annuity, supplement, and TSP are covering your expenses ok?
Annuity and supplement alone should be enough to cover my expenses.
House and cars paid off - no debt to speak of other than every day living expenses.
I haven’t started receiving any monies yet but based on the estimates, I anticipate a $200 per month raise over what I was bringing home as I had my TSP maxed out for several years. The million dollar question is when will my interim payments begin?
Yes, I’m taking home as much retired as I was when I was working. Expenses are basically the same, so anything I earn on the side is gravy. Having no income limitations until 57 years old is great too. Anything I make helps the cause.
I have been retired less than 3 months, but yes I believe so, especially once I am receiving my full pension and supplement.
I retired at 56 and will be living off of my annuity and supplement until I turn 62. Both of those income streams cover my monthly living expenses and I can still put money towards giving, my brokerage account, and emergency fund. Once I turn 62 and the supplement stops, I will begin pulling from my TSP until I turn 67 and then turn on social security.
I don’t have any debt other than my mortgage which is $1271.00 a month (principle, interest & includes escrow account).
I am actually doing better in retirement as I ended up with a pay raise. I have started TSP monthly disbursements with a Roth conversion factored in. This, so that I can attempt to partially manage SECURE Act tax liability for my heirs. I think FERS is better than the old system and provides us with an incredible retirement that the average American is not so lucky to have.
More than enough and have not yet begun taking TSP distributions. The calculator on the TSP website reveals with a $6,500/monthly distribution beginning in 2022 with a balance that earns at least a 6% annual rate of return (the C Fund since inception has enjoyed a more than a 10% annual rate of return) my account will last me more than 40 years, assuming I live that long. I seem to be covering my expenses with my annuity and supplement alone.
So, far “yes” but there are other factors. I sold my home in the DC area and made over $100,000 more than what I paid for it. I have enough now to buy a home outright in the south, so that’s a big chunk of money I don’t have to stress over. I haven’t gotten my final figures yet so not sure about what’s to come but I feel confident.
Haven’t tapped into my TSP because of my post retirement job. But I know I can do it.
I'm still waiting on my first interim payment from OPM, so it's a little early to know for sure. But, all the estimates indicate that expenses will be covered easily.
Yes, they are covering all my expenses without having to work. I am using a small amount of my TSP but it is still growing.
If you are in the private sector (or looking to get into the private sector), how did you find/are you finding the experience of job-hunting? Did you hire a resume service, or some sort of job placement consultant?
Not working and no plans to get a job if I can help it.
N/A at the current time.
N/A
I have discovered that neither SAM.gov nor Dun and Bradstreet are very easy to work with.
Got hired through a friend. I’m a government contractor. I WOULD NOT recommend the background investigator gig. A ton of unpaid training and more PALMS courses!!!
I am not currently in the market for a job after retiring from government service. Instead, I have enough savings so a second career will be on my terms as a “want” versus a “need,” doing something I enjoy. I plan to pursue the “hobby” in 2022.
I began interviewing prior to leaving the government. My plan was to begin volunteering where I want to work and hope it becomes a full-time job. So far, I am implementing my plan and my responsibilities have increased to the point I can see a part-time or full-time job coming and I think I will be able to choose what I want.
I was fortunate to have contract companies all around me. Networking with people is the best way in my opinion.
What would you tell those considering retiring in the next few years?
Everyone has different situations regarding their financial situation but i'd say take a good look at your numbers and try and get some type of retirement planning session if you can, even if you have to pay.
If you don't have any idea how much your annual expenses are compared to your current income and your projected retirement numbers, figure it out as soon as possible.
Have a plan for what to do with your time before retiring. The days get long with no focus.
Run your numbers and do your homework on submitting a healthy retirement package.
Go when you have achieved your professional goals and are able to support your personal goals. If you do plan to get another job, leave while you are marketable for the new career you are seeking.
My thoughts to those considering retiring in the next few years are the following: 1) reduce your debts as much as possible; 2) try living on a “retirement income”; 3) attend retirement seminars; 4) subscribe to NARFE (this has been and still is so helpful); 5) use the FERS basic retirement calculator spreadsheet; 6) max out your TSP.
The more educated you are on the retirement process, your finances/expenses and what you need to do to prepare for retirement, the less stress and/or anxiety you will have.
Meet with a financial advisor. Either one that is provided free as a service for investing with a larger financial firm or pay for a few meetings with an advisor. They can help you to manage your finances both while employed and in retirement as well as with potential tax implications and Social Security strategies. Be careful though with the smaller companies that make money by making trades on your behalf that don’t necessarily benefit you
Leave sooner rather than later. Staying another year for a percentage more annuity or another 20k in your TSP is not worth it. Enjoy your life. Get a hobby or several.
There is life after government service. Retire as soon as you are eligible. By the time we reach age 80 to 85 we aren’t spending a lot of money or doing a lot of traveling. Many may find themselves watching Wheel of Fortune in a recliner wearing khakis and white Velcro tennis shoes in a retirement home. So from the date of retirement, we have between 23 and 30 years to truly enjoy the balance of our productive years. I say maximize the time by not being that employee who applies for extension after extension, who believes government can’t survive without you, and eventually has to be drug out of the office on the final day. If you can’t do it on your own work with a professional to understand the numbers and evaluate really why you may still be working. Don’t undervalue the value of an annuity and healthcare benefits earned just for waking up every day.
Don’t wait. Go live your life on your terms. You’ve earned it. I did experience some hesitation as the date approached and am still can’t believe I actually retired, but there is life out there if you do a little planning ahead. Have something, even if it’s volunteer work, to go to and the transition is much better.
You can do it. Plan for it. Get some certifications if you plan to continue working.
Get out of debt and reduce your expenses. Start retirement paperwork early (my agency likes at least 60 days).
Pay off or at least pay down your debt. The less debt and fixed expenses you have the better especially with recent inflation.
What would you tell those 20-somethings that are just starting their federal careers?
Max out your TSP ASAP and leave it alone - don't try timing the market and moving it around and definitely don't panic when the market takes a big hit. It will definitely come back.
I cannot stress enough to feed your tsp and max out as soon as possible. Stay away from the G fund as I wasted valuable years early in my career as I was not briefed on the TSP when first hired by the U.S. Courts system.
Put as much money into the TSP C fund as you can and let it sit. Trying to move money to a safer or better performing fund seldom does better. I had a boss with three years less time on the job that never looked at or moved his money from C, except to make sure he was maxing out his contributions every year and he had close to $300,000 more money when he retired at 20 years than I had at 23 years in the TSP.
My advice to the 20-somethings is to max-out TSP and make sure you are contributing to both Traditional AND Roth.
Live within your means and save for emergencies!
Max out your TSP. Put everything in the C fund. Set it and forget it. Don’t burn bridges, one day that A-hole will be your boss. Make and keep as many friends in the government as possible. When eligible, take the money and run. Tomorrow is not guaranteed.
If at all possible, max out your TSP contributions NOW. You will learn to live with a reduced GS-5 or GS-7 pay check within a few months. Each subsequent step raise will make life easier. Be aggressive in the Thrift, with C or S funds, avoid the G and Lifecycle funds. Never, ever try to time the market. Rejoice when it is down as you are buying your shares on sale. The year you turn 50, sign up for Catch Up contributions. Time is your greatest ally.
In my early 20s, circa 1997—and well before the proliferation of the Internet, online trading, and more than a decade before the advent of social media—I began investing in the stock market through what was then the paper version of dividend reinvestment programs (DRIPs). Many fortune 500 companies allow investors to contribute nominal amounts of money to buy fractional shares of common stock. Some programs offered discounts on the purchase price for each share, although that benefit largely evaporated over time. I initially bought into 10 companies (e.g., ABT, DUK, KO, PG, PEP, PFE, etc.). Based on program guidelines I would mail—and later draft from my checking account—small amounts of money—whatever I could come up with even if it was as little as $25—on a monthly or quarterly basis to invest in fractional shares of stock. As my portfolio grew, I added companies through the tech boom of the early 2000s (e.g., HD, MAR, TD, SBUX, etc.) and enjoyed additional positions from spinoffs (e.g., SJM, YUM, VAC, etc.). The paper version of monthly statements transitioned to an online account where I continue to reinvest dividends. By age 50 I have an personal brokerage account balance of $1.7 million. This is in addition to my TSP balance of $1.3 million.
My advice to any 20-somethings starting a career in public service is to skip the daily $5 cup of Starbucks coffee and set up and begin contributing to an online brokerage account. Many offer free stock trades. Reinvest the dividends to buy additional fractional shares. Moreover, beyond a mortgage avoid significant debt. Become disciplined to pay off your credit card(s) each month (i.e., not spending beyond your means). SCEs don’t need a new car every other year when the Government provides one to get you between home and work each day (e.g., I had the same POV SUV for 16 years before gifting it to my nephew when he turned 16 years old).
Equally important to all of the aforementioned, contribute the maximum amount possible to your TSP. In the early years of my career TSP capped contributions at 10%. At some point in the early 2000s the percentage increased to 11%, 12%, 13%, 14%, and 15%, one additional percentage each of 5 consecutive years before the cap was lifted to match the IRS limit. From the very beginning and through the years of my career I contributed the maximum allowance (in addition to the aforementioned contributions to a personal brokerage account, both on a single government salary). For those who do not believe they can afford it, follow the advice of Dan Jamison of the FERSGuide and increase your TSP contribution $5 every pay period until it hurts. Then the next pay period back it down $5. When annual pay adjustments occur in January each year, instead of spending the extra $40 in net income each pay period, use it to increase your TSP contribution. Same for QSIs, cash or performance awards, and step increases.
Having retired at the earliest date of eligibility with a cumulative $3 million on deposit in my TSP and personal brokerage accounts, I also have additional funds in checking and savings, as well as real estate investment trusts. None of my wealth was inherited or won through gambling or a lottery, but based on my government salary alone. I grew up in the Appalachian Mountains with two brothers and two sisters in 2-bedroom home with a wood-burning stove for heat. We were fortunate to not have to walk barefoot miles uphill in snow to and from school. Now retired 6 months I plan to consider a second career in 2022 more as a “want” versus a “need,” meaning I don’t ever have to work again. With good financial planning (i.e., minimize debt and invest over the long-term) there is no reason my story can’t be replicated. The one advantage you now have is much more time to watch your money grow.
Work hard and don’t be afraid to promote. I waited until my last five years to take the leap and promoted to bolster my TSP and retirement. Promote sooner than I did. If you’re hesitant about whether you will do well in supervision just go to HQ and you will realize if some of the people they’ve promoted can do it…you can do it. And life on the supervisory side is much better once you attain a certain level.
Keep your nose clean and contribute to your TSP.
Max out TSP contributions
Don’t make your job your life or your identity. You are dispensable. Work hard but have a balanced home/work life. It makes transitioning to retirement much easier. Start contributing to the TSP as soon as possible, contribute the maximum you can, and invest a majority in the C fund. Luckily, when I started someone told me to increase my contributions to the TSP every time I got a raise so I wouldn’t miss it. Boy, were they right. I started as a GS-6 making $16,521 a year and retired with 1.1 million in my TSP. Don’t get into too much debt. Also, you can get loans for a home, a car, and school but you can’t get loans for retirement so save, save, save for retirement.
What resources did you use to get retirement/post career guidance? And would you recommend it to others?
When I started in 2000, I was not aware of any resources - we would at the mercy of the older agents telling us which TSP funds we should be in.
Today there are much more resources available.
I did use these resources when I became aware of them:
Dan Jamison's FERS Guide
Chris Barfield emails and website and a mid-career retirement session
Online articles from websites such as Govexec, Federal New Network etc - just trying to stay informed.
I also had a private free session with a retirement planner some years back that I met during a FLEOA seminar.
I started attending every retirement seminar I could find about 10 years prior to retirement and encouraged my coworkers to do the same as the federal government retirement is complicated. I also joined several Facebook groups and learned from professionals in those groups. I read everything I could related to retirement and subscribed to several newsletters.
Read, read, read. Ask questions. I subscribed (and still do) to retirement newsletters and read articles on websites whose audiences are government employees (e.g., FedManager, Government Executive, Federal News Network, etc.). I am an annual subscriber of the FERSGuide and monthly subscriber of Barfield Financial. Understand benefits and when it’s wise to cancel them (e.g., FEGLI is the best buy until it becomes cost-prohibitive certainly by age 50; I cancelled mine at age 40 when purchasing a whole life insurance policy as an investment opportunity). Compare and contrast FEHB plans during Open Season. Take advantage of tax mitigation strategies (e.g., FEHB HDHP). Take responsibility for your financial future.
Dan Jamison’s Fersguide
OPM RI 90-1 - FERS
OPM RI 90-8- Information for FERS Annuitants
OPM RI 38-126 - Life Events and Your Retirement and Insurance Benefits
Social Security Statement
FERS Benefit Statement
myfederalretirement.com federal retirement checklist
TSPBK08 - Summary of the Thrift Savings Plan
TSPFS10 - Questions and Answers to TSP Withdrawal Options
TSPBK02 - Withdrawing from Your TSP Account
TSP-775 - … TSP Withdrawal and Required Distribution
TSP-536 - Important Tax Information about Payments from your TSP Account
TSPBK31 - Death Benefits
IRS Publication 721 - Tax Guide to US Civil Service Retirement Benefits
Prior to retiring, I attended retirement seminars presented by Pinnacle Personnel Services (Deborah Hatch) and I would highly recommend her. After retirement, I have been reviewing the webinars on NARFE’s website given by Tammy Flanagan also excellent!!
I subscribed to all of the free federal email strings such as FedAgent, My Federal Retirement, and FedSmith. They all have good articles with surprisingly polite and relevant comments from readers. I wish I had discovered Mr. Barfield sooner as he provides fantastic advise and has great insight into our retirement system. I also took advantage of both in person and virtual retirement seminars when my agency offered them.
Chris Barfield and Angry Dan Jamison provided me with all the knowledge and scenarios. I read the FERSGUIDE from cover to cover every year.
Chris Barfield and Dan Jamison are excellent resources for 1811’s. 100% recommend their advice. The more you understand the more your confidence grows in taking the retirement plunge.
I also talked to retirees. I haven’t seen a miserable retiree yet.
Yours and Dan Jamison’s FERSGUIDE.
For retirement guidance, I definitely relied on advice from Chris Barfield and would highly recommend him to others. I also participated in a retirement webinar that my agency sponsored (also recommended).
I attended federal retirement seminars, read the Fersguide and all the articles provided by you and Dan Jamison. I used the retirement estimators provided by my agency and the one on the Fersguide website. I would recommend all of these things as well as reading as much as you can and talking to as many people as you can.
Anything else you would like to share with current employees?
I can't stress enough the importance of maxing out the TSP and doing your best to live within your financial means by having a very good understanding of your debt to income ratio.
I can say from personal experience, don’t let what you read or hear from others scare you when it comes to OPM’s backlog. I retired on August 31, 2021 and received my lump sum annual leave pay-out on October 4, 2021. I was expecting my annual leave to come around that date but I was not expecting my 1st OPM interim payment on October 7, 2021. The letter I received from OPM stated I will be receiving my interim payments on the first of every month until my case is finalized. So, in my case, I did not have to wait 4-5 months before receiving my first interim payment. Everyone’s situation is different, if you prepare and ensure your paperwork is filled out correctly, hopefully you too will experience the same. Or, maybe OPM is processing a lot quicker than what they are reporting.
Strongly consider moving a portion of your TSP to a private investment firm when you retire. The Thrift is not easy to deal with in retirement and the current administration wants to make numerous ill advised changes to a system that has worked well for the employees over the last four decades. Consider the Roth option within the TSP as well to make your taxes less cumbersome in retirement.
You are very lucky to have a great, secure job that still pays a pension. You are also very lucky to have health insurance. Both of these will benefit your spouse and family, even after your death.
I see too many government workers obsessed with their TSP balance. Some check the market several times a day. I know way more retirees that haven’t withdrawn a penny from their million dollar TSP balances.
My advice to you is: Stop watching the daily stock market. Withdraw a percentage of TSP money the month after you retire and don’t stop until you die. Your family will then have a chunk. Those TSP checkers/non-withdrawal folks are going to be in their mid 70s having to withdraw HUGE amounts due to RMDs.
Tomorrow is not guaranteed.
According to a recent report by the Federal Reserve Bank, household debt climbed to a new record of $15.24 trillion in the third quarter, an increase of $286 billion or 1.9% from the second quarter of the year. Credit card balances rose by $17 billion, just as they had during the second quarter. Total credit card debt is already $1.1 trillion higher than at the end of 2019. Mortgages rose by $230 billion last quarter, totaling 10.67 trillion. Auto loans and student loan balances also increased, rising by $28 billion and $14 billion, respectively. All this and yet, we are experiencing a labor shortage.
Enjoy your career by making a difference. We can certainly afford more of the 20%ers who often do 80% of the work. Though, don’t lose sight of the finishline as soon as you can cross it. Controlling what you spend to avoid significant debt while maximizing investment opportunities is not necessarily rocket science. We spend a career training and practicing the precision of firing a round down range to hit a target. There is no reason we cannot be equally disciplined to spend within our means to avoid debt to the greatest extent possible (e.g., paying off credit cards at the end of every billing cycle).
Be grateful for the salary and benefits earned as a federal employee. Yet, don’t believe working until ages 57 (for an SCE) or 70 to increase a social security benefit is necessarily worth the daily commute, years of additional grind, and time away from enjoying what we hope to be the final decades of life. Tomorrow is not guaranteed.
Good luck. Stay strong and Stay safe.
And if you enjoy what your’re doing, keep doing it.
It's never too early to start planning for retirement. Learn all you can about the process and give your HR department plenty of time to process your paperwork.
Don’t be afraid to retire. I get validation everyday from my former co-workers, family and friends that I made the right decision to retire. It was time. I had a successful career but I am enjoying the next chapter.