fbpx

Posted on Sunday, 17th February 2019 by

Share

Many retirees dream of a home away from home. The thought of having a place to escape to in the winter months, or during the summer for sun lovers, is enticing on many levels. Others consider a mobile home to explore this vast county in style and to visit the many attractions they heard so much about growing up.

Northern cold climate retirees, snow birds, are either relocating to or buying second homes in the south in large numbers, some going as far as Central America to escape their frozen environs. If you are thinking about a second home there are many factors to consider, both pro and con, before signing on the dotted line.

Things to Consider When Buying A Vacation Home

1) Does your Home Owners Association (HOA) allow short term rentals?

Before buying a vacation property determine if the complex allows short term rentals. Short term rentals can create issues for fulltime and vacation home owners that don’t rent their property.

There can be a constant flow of new people coming and going from rental units.  Some plans restrict rentals to 6 month or longer, which is ideal for those not wanting to deal with short term rental turnover. If you are considering a vacation condo, townhome or patio home, and don’t want to rent your property when you aren’t there, find a complex that restricts short term rentals.

CLICK HERE To Receive Your Free Copy

2) What are the costs of ownership?

Another consideration is the expense, can you afford the upkeep, utilities, taxes, and common charges. When a new plan opens the builders may have kept the common charges (HOA fees) low to attract buyers. Once the complex sells out, the common charges can increase.  Typically, you must pay common charges of several hundred dollars monthly to cover everything but your electric, insurance, Internet, and taxes. When you add all costs, even without a mortgage, your monthly expenses can easily reach $500 or more monthly. Discuss all of your costs with the realtor and talk with the tax office to verify their estimates.

Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

3)What is your real estate tax liability for non-resident property owners?

Taxes for those residing out of state are often considerably higher than permanent residents. In some states a non-resident owner can pay up to three times more than what a permanent resident pays for real estate taxes. The taxes are often far less than what many would have to pay up north, yet it seems unfair to penalize vacation home owners when they are only using the services at that location part time. If you rent your vacation property the state and city may add additional taxes including a personal property tax and a higher rate depending on the property classification.  

4) Consider noise in condo and attached properties.

Noise can be a problem, especially when you have short term rentals in your development. Many large complexes have a security service that you call to address inappropriate behavior and excessive noise.  The owner of the unit above could install hardwood floors that often magnify foot traffic. If you are concerned about noise it may be best to purchase a top floor unit to reduce your exposure from the noise above. That being said, noise from adjacent units and those below can also be a problem.

5) Are you considering renting your unit?

Many buy vacation homes with the thought of paying part of the mortgage and expenses by renting their property through a property management firm. This can make it more affordable for the buyer. However, the buyer must be aware of rental pitfalls. Rental units often get abused by renters and the owner must pay for the repairs and upkeep even though some costs can be recovered from the negligent party.  Also, the property management fees can be excessive and your share shrinks as expenses rise.

Another consideration is that once you rent a property, often the city and state taxes increase because it is now an income property. With a rental property, you may have to pay personal property taxes and your Assessment Ration (RTO) can more than double your assessed value. In South Carolina your RTO ranges from 4 to 10.5% which means your property value is multiplied by these percentages to determine your assessed value for tax purposes.   

6) Is the trip to your home away from home sustainable?

Travel to and from your vacation home takes planning, coordination, and time. Ideally, its beneficial if it is close enough to just get up and go anytime you feel the urge to get away. If the property is over 5 or 6 hours away the trip can become tedious and dangerous, especially in winter weather. Ideally, the shorter the drive time the better and less stressful the journey.

If you fly that is another story and flying adds other factors to consider such as car rentals, etc.  Consider the trip length before buying. Even though you may be able and willing to do it now, as we age travel becomes more of a problem. Can you sit for extended periods, do you like or can you at least tolerate the trip several times or more each and every year?  The further away the more hesitant you are to make the trip.

7) Environmental concerns.

Those living up north are often unaware of the heat, humidity, and pest control issues when owning a southern property. Many first-time vacation home buyers turn up the AC to 80 in the summer and leave it at 50 degrees in the winter when returning home to reduce their vacation property utility costs. This leads to other problems. Keeping it at those extremes can cause mold and mildew problems.

You can install a NEST thermostat in your vacation home and adjust the HVAC system temperature remotely from your cell phone.  If you can’t adjust your HVAC remotely you have to have someone in the area to do it for you, either a neighbor or handyman. You can also install a video monitor at your condo if you are concerned about security issues and access. Many condos and townhome complexes include internet, cable, and Wi-Fi in the monthly common charges.

Most condo common charges include pest control and they treat the units on a set schedule that varies per location. If you leave a home for extended periods down south bugs become an issue, even with treatments expect the unexpected at times.

8) Are you comfortable with vacationing at the same place every year?

Once you buy a vacation home you’re obligated to visit often. There are maintenance issues such as regularly changing the HVAC air filters, pest control, general cleanup and maintenance that you have with all properties you own. In many cases, a second home is just that, a home away from home, not a vacation destination. A lot of vacation home owners maintain a daily routine just like at their primary residence. It is an escape from the winter doldrums for snow birds and just a comfortable place that they enjoy getting away to.  

There are many things to consider before buying a vacation home. I suggest making a list of pros and cons and perform a detailed budget analysis to determine if it’s affordable and makes sense for you and your family. Yes, it is nice to have a place to escape to, however without a complete evaluation and review you may regret your decision.

Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

Helpful Retirement Planning Tools / Resources

Distribute these FREE tools to others that are planning their retirement

Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

Be Sociable, Share!

    Posted in BENEFITS / INSURANCE, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, Travel

    Comments (0)|

    Posted on Friday, 8th February 2019 by

    Share

    I received my TSP 2018 Annual Statement this week and there was a short announcement about the Lifecycle (L) Fund changes on the backside of the Highlights sheet. The statement includes your total contributions, projected lifetime monthly annuity amount, fund and account performance statistics and more.

    The TSP has begun adjusting the L Fund allocations differently with the intention of improving investment outcomes. Effective in January 2019 the L Funds will increase exposure to international stocks (the I Fund) from 30% to 35% of the overall stock allocation. Vanguard suggests, “To get the full diversification benefits, we recommend that you consider investing about 40% of your stock allocation in international stocks and about 30% of your bond allocation in international bonds.” 

    Furthermore, the L 2030, L 2040, and L 2050 overall stock allocations will hold steady for a period of years before resuming their transitions from stocks to bonds. In addition to improving investment outcomes, this pause is intended to align the L 2030, L 2040, and L 2050 Funds with the L 2060 Fund, which will be introduced in 2020 with an initial stock allocation of 99%. You can track the quarterly allocation changes on the TSP site. 

    Sign up for a FREE Federal Employee Workshop (Pittsburgh Area)
    Hefren-Tillotson / Member SIPC
    A no-obligation workshop for Federal Employees interested in learning how to prepare for retirement.

    Many retirees move to the L Income Fund to keep up with inflation with less risk. The L Income Fund stock allocation (C, S, and I Funds combined) will increase from 20% to 30% over a period of up to 10 years with a greater emphasis on international stock exposure. A financial adviser can recommend fund allocations that would best suit your personal situation.

    Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

    The L Income Fund’s allocations prior to this change were 74% G, 6% F, 11.20% C, 2.8% S, and 6% I. This mix provided an 80% bond to 20% stock ratio. The L Income Fund allocations were fixed at these levels until the January 2019 change.

    Request Your FREE Copy Today
    Limited Time Offer

    The shift started in January of 2019, the total bonds from the G and F fund decreasing below 80% and gradually move to 70% by 2028 as shown in the above chart. This move increased the stock funds to a total of 30% of fund assets.

    Fund performance figures for the previous 12 months are listed in the TSP chart presented below. The only funds that increased in value were the L Income, L 2020, G and F funds. The G fund was the best performer during this period with a 2.94% gain followed by the F Fund with 2.39%. The L Income had a 1.44% gain followed by a .32% gain in the L 2020 fund. All others lost from 1.89% for the L 2030 Fund to a high of 12.11% for the International I Fund.

    There are more TSP changes coming, including new withdrawal options and a major website makeover later this year.  Many new employees along with uniformed service members that elected the new Blended Retirement System (BRS) are participating in the program this year. We will keep you informed of these changes as they are implemented. This is a good time to assess your TSP allocations and contributions. If you are invested in the L Life Cycle Funds review how the new allocations will impact your investments.

    Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

    Helpful Retirement Planning Tools / Resources

    Distribute these FREE tools to others that are planning their retirement

    Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

    Be Sociable, Share!

      Posted in BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP

      Comments (0)|

      Posted on Tuesday, 5th February 2019 by

      Share

      I received several emails from federal workers that quit because of the shutdown! They asked how to cash in their FERS retirement. Recently, the Washington Post published an article about federal employee’s facing the decision to Stay or Quit.

      Sign up For a FREE Federal Employee Workshop (Pittsburgh Area)
      Hefren-Tillotson / Member SIPC

      A no-obligation workshop for Federal Employees who are interested in learning how to effectively prepare for retirement.

      Certainly, new hires and those with only a few years federal employment were struggling, and I understand that. Many others are living paycheck to paycheck. However, I recommend thinking twice before taking an action you may regret down the road, the grass isn’t always greener on the other side. Most federal credit unions offered no or low-cost bridge loans, waived monthly payments, and many financial institutions and companies offered some form of assistance. You just had to ask.

      Request a  Federal Retirement Report today to review your projected Annuity payments, income verses expenses, FEGLI, and TSP projections.

      Federal employees have the best of both worlds. We’re furloughed and still eventually get paid. Laid off workers in the private sector apply for unemployment compensation and receive a fraction of what they were earning while employed. Federal benefits are among the best available anywhere. We have generous vacation and sick leave options, excellent pensions and TSP (401K) retirement plans, low cost insurance policies, and many health care plans to choose from. Federal employment is secure, for the most part, and employees often have careers that last a lifetime. Mine did.

      My brother worked in the private sector for 45 years, was laid off and had to start over a half dozen times or more. He worked for major corporation; US Steel, H. J. Heinz, the Horne’s Department Store, Murphy’s, the Burlington Coat Factory, and many others that simply downsized or shut down. They left him high and dry, and in most cases without a pension. He had to relocate twice and both times those companies downsized. This is not unusual in the private sector. When he was laid off, he subsisted on unemployment compensation until he found a new job. That’s reality on the other side. Sure, there are great private sector jobs too, finding one may not be so easy

      Because federal employment is considered secure, many don’t take the precautions they should to prepare for emergencies, such as a shutdown. I often discuss ways to economize and save not only for retirement but for life’s uncertainties. Everyone should have a safety net, 3 months of expenses for times like this stashed in a savings account plus other reserves the closer you get to retirement. When I talk to groups and mention this, many say they simply can’t save, they live pay check to paycheck. I tell them it’s possible and you have options to make it painless.  You just have to do it, start small and grow your savings over time.

      Here is a list of articles and other resources that you may find helpful to save for a rainy day:

      Another shutdown may be coming soon, if the parties can’t agree on border security.  Don’t get frustrated, call your representative and tell them to negotiate in good faith. Unfortunately, our representatives spend more time raising money for their next campaign than they do representing their constituents.

      Request a Federal Retirement Report™ today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

      Helpful Retirement Planning Tools / Resources

      Distribute these FREE tools to others that are planning their retirement

      CLICK HERE to Request A Free Copy While Supplies Last

      This book is an indispensable resource for the everyday investor, “Gold Is A Better Way” turns the strategies recommended by Wall Street on their head and makes the case for a return to sound investing.

      Adam Baratta strips away all the confusion and complexities surrounding investing and breaks down investment concepts and the simple fundamentals driving markets. He provides a roadmap for how to win at the game of investing and, more importantly, explains the “why” so readers can continue to win. Everyday investors gain tools that allow them to know with certainty they are making sound investment decisions, as well as an understanding of where to diversify investments that have historically performed well.

      “A fresh new voice in the world of gold . . . Baratta’s book and cutting edge platform make the undeniable case why gold demands consideration in every portfolio.” -ZeroHedge

      Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

      Be Sociable, Share!

        Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, EMPLOYMENT OPTIONS, ESTATE PLANNING, FINANCE / TIP

        Comments (0)|

        Posted on Saturday, 19th January 2019 by

        Share

        Normally, federal annuitants don’t received their 1099R Tax Forms by regular mail until the end of January or the beginning of February. If you are registered to use OPM’s Retirement Services Website your 1099R is now available for download. I visited the site on January 16, 2019 and was able to download my copy that I will use for my 2018 tax return.

        Complete Your 2018 Taxes Early

        Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

        To get a head start on your taxes visit OPM’s web site and download a copy. You must be registered to use the site. If you aren’t registered read the article titled “Connect to OPM’s Online Services” to understand the registration process and sign up. It doesn’t take long, however, you may have to wait for your password to be sent via regular US mail and that can take several weeks.

        Many bank and brokerage 1099 and DIV reports are also available online and can be downloaded from your accounts. This can expedite the completion of your tax return. The government shutdown may slow things down this year since the IRS will not process paper tax returns until after the shut down is over. However, the postal service will still post mark your paper filed return. Any tax return postmarked by the due date will be considered filed on time by the IRS. Even if the shutdown is ended soon processing delays can be expected. 

        I’ve personally used Turbotax software since they first issued this helpful software package. It’s intuitive and walks you through the entire process, double checks your work, and they allow you to file online. This software can also download and integrate your brokerage accounts into your tax return, saving you much time.

        Take advantage of OPM’s early 1099R online availability if you wish to file early or simply need to replace a lost 1099R.

        Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

        Helpful Retirement Planning Tools / Resources

        Distribute these FREE tools to others that are planning their retirement

        Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

        Be Sociable, Share!

          Posted in BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, RETIREMENT CONCERNS, SURVIVOR INFORMATION

          Comments (0)|

          Posted on Tuesday, 15th January 2019 by

          Share

          This shutdown is the longest in history and if the parties can’t agree on funding border security this shutdown could go on for some time. The Washington Examiner reported, “Some 30 Democratic lawmakers left the government shutdown behind Friday on a chartered flight to Puerto Rico for a winter retreat with 109 lobbyists and corporate executives during which they planned to see the hit Broadway show “Hamilton” and attend three parties including one with the show’s cast.”

          Making Ends Meet

          Our representatives should stay in Washington until government is funded. We the people should insist that anytime Congress refuses to come to the table and forces a shutdown, our representatives must not be paid for the duration. They should also NOT receive back pay like all other feds will receive, make them pay for their inaction and inability to do their job.

          Fortunately, there are ways for furloughed employees that don’t have sufficient resources and savings to bridge the gap until their back pay is restored.  

          Credit unions and other financial organizations are coming together to help furloughed federal workers make it through the government shutdown. The Allegent Federal Credit Union in Pittsburgh is offering low-cost short-term loans plus they initiated a NO COST “Skip A Pay” service for all federal employees affected by the shutdown. Furloughed employees should contact their local credit union for similar low and no cost assistance.

          Here is a short list of things furloughed employees can do if they are having a difficult time financially during the shutdown:

          • Furloughed employees may be able to file for unemployment compensation, those who are not working. However, be aware that once your backpay is restored you must pay back the unemployment compensation that you received.
          • The Credit Union National Association announced that credit unions across the U.S. are providing assistance to the affected employees. Some of the programs included:
            • Zero percent APR interest signature relief loan for 12 months signature relief loan
            • Pay Disruption Assistance Program with mortgage loan forbearances, loan and credit card payment deferments, and short-term low rate loans
            • Online member portals with special furlough loans
            • Preexisting loan deferred payment opportunities for up to 60 days
            • Cash advances of up to 90% of federal employee’s regular monthly pay. Contact your local utilities and ask them what programs they have for situations like this. I called several utilities in my area and they have a budget option plus offer other ways to assist such as their Customer Assistance Program (CAP).
          • If you aren’t able to make your mortgage or car payment contact the lender immediately to let them know before the payment is due. They may have programs available that will help you avoid a late payment or they could offer a short-term loan to help.
          • The National Active and Retired Federal Employees Association (NARFE) partnered with the Federal Employee Education & Assistance Fund to offer $100 grants to active federal employee NARFE members who are not receiving a paycheck during the current shutdown as a result of being furloughed or working in excepted status. Members can APPLY online.  You will need to provide documentation of your furlough or excepted status. FEEA will contact you with any questions, and will let you know if your request is approved or denied. You must be a NARFE member in good standing and your membership status will be confirmed with NARFE. For questions, please contact me at execdir@narfe.org
          • Articles concerning assistance for furloughed federal employees.

          I suggest calling your representatives and let them know it’s time to get back to the table and pass a budget. They need to do what’s good for the country and do their jobs. This has gone on far too long. 

          Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

          Helpful Retirement Planning Tools / Resources

          Distribute these FREE tools to others that are planning their retirement

          Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

          Be Sociable, Share!

            Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, FINANCE / TIP

            Comments (0)|

            Posted on Saturday, 12th January 2019 by

            Share

            OPM issued a FACT SHEET covering the impact on federal employee benefits and pay as a result of the government shutdown. The following excerpt explains the impact on employee’s pay and benefits.

            FACT SHEET:  Pay and Benefits Information for Employees Affected by the Lapse in Appropriations

            Government Shutdown Briefing

            Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

            This information covers pay and benefits matters that may be important to employees if the lapse in appropriations continues past payroll processing deadlines.  Payroll deadlines vary from agency to agency, so the actual timing of when an employee’s pay and benefits may be impacted will vary. 

            This information is only for employees who are:

            • Furloughed (a type of nonpay status), or
            • “Excepted” from furlough (i.e., continuing to work and earn pay, but their pay is delayed until appropriations are authorized). 

            Employees who are “exempt” from the lapse in appropriations (e.g., because they are not paid from annually appropriated funds) are not impacted.

            What you should know

            PAY

            Furloughed employees: You cannot receive pay during a lapse in appropriations if you are furloughed, and Congress will determine whether you will receive retroactive pay for furlough hours.

            Excepted employees: You are entitled to be paid for hours worked, but you cannot receive pay until funding is provided.

            ANNUAL AND SICK LEAVE ACCRUAL

            Any leave you had previously scheduled during the lapse period is cancelled, so you won’t be charged leave.  In addition, per OPM guidance, if you had properly scheduled “use-or-lose” annual leave that you weren’t able to use because of the lapse in appropriations, that leave must be restored to you.  Your agency will provide instructions on any action you may need to take.

            Furloughed employees: You won’t accrue annual and sick leave during the furlough once you’ve been in a nonpay status for 80 hours (for full-time employees with a regular 80-hour biweekly tour of duty).  Congress may, however, authorize retroactive accrual of leave.

            Excepted employees: You will continue to accrue leave, but accrued leave will not be available for use until funding is provided.

            RETIREMENT

            No retirement deductions will be made if you aren’t receiving pay.  Generally, a period of nonpay status will have no effect on an employee’s retirement-creditable service or high-3 average pay unless the nonpay status is for more than 6 months during the calendar year.

            ALLOTMENTS FROM PAY

            Since no allotments can be made if you’re not receiving pay, you may want to review your allotments to determine whether you’ll need to make alternative arrangements (e.g., if you are using allotments to pay loans, alimony, etc.).

            UNEMPLOYMENT COMPENSATION

            Furloughed employees are eligible to apply for unemployment benefits, but excepted employees working on a full-time basis are generally not eligible. Employees who wish to file should do so with the Unemployment Office for the state where the employee worked (i.e., last official duty station prior to furlough).

            Please be advised, however, if Congress authorizes retroactive pay for furloughed employees, you would be required to pay back any unemployment benefits you received, in accordance with State law.  For more information see OPM’s Pay-Leave Guidance and the U.S. Department of Labor’s Unemployment Compensation for Federal Employees website, https://oui.doleta.gov/unemploy/unemcomp.asp.

            FEDERAL EMPLOYEES HEALTH BENEFITS (FEHB)

            FEHB coverage continues even if you don’t receive a paycheck.  Your share of premiums will accumulate and be withheld later when the lapse ends and employees can be paid.

            FLEXIBLE SPENDING ACCOUNT (FSAFEDS)

            Your FSAFEDS payroll deductions stop when you don’t receive pay.  You remain enrolled in FSAFEDS, but you can’t be reimbursed for eligible health care claims until you return to pay status and your payroll deductions can be made.  Payroll deductions will be subsequently collected to match your annual election amount.

            Eligible dependent care expenses incurred during the lapse in appropriations may be reimbursed up to whatever balance is in your dependent care account—as long as the expense incurred allows you (or your spouse, if married) to work, look for work, or attend school full-time.

            FEDERAL LONG TERM CARE INSURANCE PROGRAM (FLTCIP)

            Your coverage will continue.  However, if you usually pay your premiums through payroll deduction, and the lapse period is less than three consecutive pay periods, your accumulated premiums will be withheld when the lapse ends and employees can be paid.  Otherwise, Long Term Care Partners will begin to bill you directly for premium payments.  You must pay those bills on a timely basis in order to continue your coverage.

            FEDERAL EMPLOYEES’ GROUP LIFE INSURANCE (FEGLI)

            Coverage continues for up to 12 consecutive months of nonpay status, but premiums are collected only for pay periods for which you receive pay.

            FEDERAL EMPLOYEES DENTAL AND VISION INSURANCE PROGRAM (FEDVIP)

            Your coverage will continue.  However, if the lapse period is less than two consecutive pay periods, your premiums will accumulate and be withheld later when the lapse ends.  If you do not receive pay for two consecutive pay periods, BENEFEDS will begin to bill you directly for premium payments.  You must pay those bills on a timely basis in order to continue your coverage. 

            THRIFT SAVINGS PLAN (TSP)

            For information on the effect of a furlough on your Thrift Savings Plan contributions, loans, and investments, please refer to https://www.tsp.gov/index.html

            CHILDCARE SUBSIDY PROGRAM

            Employees enrolled in their agency child care subsidy program should contact their agency HR office for information about payments.

            EMPLOYEE ASSISTANCE PROGRAMS

            Employee Assistance Program (EAP) services can be helpful in providing confidential counseling with experienced, licensed counselors, and many EAPs can provide access to legal and financial consultation services.  Contact your agency’s EAP office to determine what services might be available to you.

            OTHER CONSIDERATIONS

            Some mortgage, loan, credit and utility providers have indicated that customers may qualify for alternative arrangements.  Please contact your providers for more information.

            Note:  This guidance should not be considered time and attendance instructions.  Guidance on documenting time and attendance will be provided by each agency and payroll provider.’

            Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

            Helpful Retirement Planning Tools / Resources

            Distribute these FREE tools to others that are planning their retirement

            Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

            Be Sociable, Share!

              Posted in UNCATEGORIZED

              Comments (0)|

              Posted on Friday, 11th January 2019 by

              Share

              OPM sent out a notice of annuity adjustment in late December to all annuitants and survivor annuitants. I received mine on December 22. This document, the first for 2019, includes your new monthly payment resulting from our recent 2.8% COLA Adjustment. There’s a lot of important information included on this form and I keep them in my retirement folder for future reference, along with all correspondence received from OPM.

              Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

              This document is a wealth of information, it lists your previous and new year’s gross annuity with all deductions and so much more. First, you should know that your 2019 deductions may change shortly due to health care premium changes resulting from the recent FEHB Open Season. You may receive a new Notice of Annuity Adjustment in February listing federal dental and vision care premium increases. The current notice does list your primary FEHB plan increase in a statement under the Notice of Annuity Adjustment Chart. Also, anytime you initiate a change to your checking/savings allotments, state or federal tax withholdings, or anyone of 89 deductions or additions listed on the back of this notice, you will receive a new annuity adjustment in the mail.

              The first adjustment that we receive each year also includes the monthly survivor annuity currently payable in the event of your death to your spouse. It actually lists the gross monthly amount payable to your named spouse. This is listed just below the Adjustment table on the form. This form also includes your retirement claim number and suggests having this number available when contacting OPM about your retirement benefits. 

              I typically highlight the key information on this form and place a copy with my estate plan. You will also find valuable information about your survivor elections on the back of the form along with OPM contact information and a list of the codes used for deductions and additions.

              Enter your new 2019 annuity values provided on this notice in our updated Projected Annuity Calculator. My annuity has increase over 33% since I retired in 2005. This calculator lets you project annuity growth through 2059!

              Those who elect a survivor’s benefit can calculate their total value without the survivor election using the data provided by this notice. For example, if your spouse’s monthly survivor annuity currently payable in the event of your death is $2,750, multiply that number by 12 to determine the spouse’s annual benefit, $33,000 a year in this example.

              If you elected a full survivor’s benefit your spouse receives either 55% for CSRS or 50% for FERS annuitants full annuity amount for life.  To elect a full survivor annuity for your spouse your annuity is decreased by 10% for FERS and just under 10% for CSRS annuitants.

              To determine your full CSRS annuity amount, without the spousal election deduction, divide $33,000 in this example by .55 (CSRS) which equals $60,000 a year.  Use 50% for a full FERS survivor’s benefit. Many annuitants assume their spouse will receive 50% or 55% of what they are currently receiving yearly. The surviving CSRS spouse receives 55% and the FERS spouse receives 50% of what your total annuity would be without a survivor annuity election. This is also the amount a federal annuitant would receive if their spouse dies while the annuitant is retired.

              Another way to look at this is that the surviving spouse for a CSRS annuitant will receive approximately 60% of what the couple receives prior to the annuitant’s death when the annuitant selected full survivor benefits.  A surviving spouse for a FERS annuitant will receive about 55% of what the couple receives prior to the annuitant’s death when the annuitant selected full survivor benefits.

              Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

              Helpful Retirement Planning Tools / Resources

              Distribute these FREE tools to others that are planning their retirement

              Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

              Be Sociable, Share!

                Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, RETIREMENT CONCERNS, SURVIVOR INFORMATION

                Comments (0)|

                Posted on Friday, 4th January 2019 by

                Share

                Many retirees and survivor annuitants call OPM to change direct deposit information and become frustrated because they can’t get through, their line is busy most of the time. OPM services 2,113,414 federal annuitants, 523,737 survivor annuitants plus postal service retirees as well.

                It is easy to change monthly annuity payments from one financial institution to another if you understand your options. Direct Deposits will continue to be received by the originally selected financial institution until OPM and the U.S. Treasury are notified by the payee that the payee wishes to change the financial institution receiving the Direct Deposit.

                It’s recommended that the annuitant maintain accounts at both financial institutions until the transition is complete. Don’t close your original account until after the new financial institution receives your first Direct Deposit payment.

                If you are already receiving your federal benefit payment by direct deposit, and would like to have your payments sent to a different account use the procedures that follow to make the change. Recently, OPM and the U.S. Treasury made changes to the program including updating the link to the SF 1199A form.

                To enroll in Direct Deposit or to change your enrollment to a new account, OPM needs to know the routing number of the financial institution and your account number. The financial institution will provide this information or you can locate this information on the checks you use.

                Use the following direct deposit change options:

                • Fax an SF 1199A form to 724-794-6633. This form can be obtained from your financial institution or you can print out a copy online. (The bank must sign the form)
                • Mail an SF 1199A form to OPM, Retirement Operations, PO Box 440, Boyers PA 16017-0440.
                • Call OPM at 1-888-767-6738. Please be sure to have your bank routing number and account number handy.
                  • OPM’s line is frequently busy, call early and often throughout the day to get through and you must have your retirement claim number or Social Security number available.

                Using OPM’s Retirement Online Services makes changes like this easy, you can make this change online after registering for the free service. I signed into my account, see following graphic, and clicked on Direct Deposit. The blacked-out areas hide my personal account information. All you have to do is click on change and enter your new bank routing and account numbers. When you access the Direct Deposit page it will state what date your change will take effect in the last line above your personal data.

                The menu to the left on the Services Online graphic show all that you can do once registered. You can obtain duplicate copies of your 1099 R statement, print out a statement outlining all of your life insurance coverage, initiate or change allotments, increase or decrease state tax withholding, print out a statement of your annuity that you can provide to lenders for loans, and much more. It is worth the time and effort to register for this service.

                To register you must call OPM and they will send you access information in the mail. Yes, I know it’s difficult contacting them by phone. What I do is dial their number, if its busy I hang up and immediately click on redial, I typically get through in several minutes using this technique. Expect long wait times, I’ve waited on hold for up to 45 minutes.

                Request a  Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.

                Helpful Retirement Planning Tools / Resources

                Distribute these FREE tools to others that are planning their retirement

                Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

                Be Sociable, Share!

                  Posted in BENEFITS / INSURANCE, FINANCE / TIP, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SURVIVOR INFORMATION

                  Comments (0)|

                  google-site-verification: google7da01e5320bde85e.html Terms Of Use