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Interim Retirement Checks & Retirement Application Processing Delays

Posted on Friday, 24th January 2020 by

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New retirees are subject to interim annuity payments and many don’t know what to expect when they first leave federal service. Federal employees must have sufficient cash available and be financially prepared when retiring to allow OPM to complete a final adjudication of their claim.

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

OPM processed retirement applications in 62 days on average in November of 2019, the latest data we have available. However, they can take up to a year to process a retirement application if information is missing or problems are encountered. From December of 2018 through November of 2019 OPM processed 102,929 retirements. Retirement application submissions typically increase January through March of each year. Last January OPM received 13,264 applications

Many are receiving interim payments for less than they anticipated due to a number of factors. OPM states that annuitants will receive approximately 90% of their expected NET monthly payment, less federal income tax withholdings. NET payments equal what is remaining after deducting health care and life insurance premiums from the gross amount. My interim monthly payment was 30% less than what I eventually received after my application was processed. It took OPM 90 days to process my application when I retired over a decade ago. Some have reported receiving much less due to extenuating circumstances.

FERS retirees need to be aware of the fact that OPM doesn’t include the FERS Supplement in the interim payment because they don’t have the data available until the retirement is completely processed. OPM reported that a number of factors cause reduced interim payments or prevent OPM from initiating interim payments. These factors include:

  • Court orders that are on file at OPM. Court orders can contribute to as much as a 50% reduction in interim payments. Check out our Divorce Forum for clarifications and informative articles on this subject.
  • Part time service
  • Unpaid military deposits
  • When a redeposit wasn’t paid for refunded service creditable towards disability retirement
  • Employees entitled to special retirements for LEO, FF, ATC or other special retirement programs
  • CSRS offset applicants
  • Non-deduction service performed after 10/1/1982 creditable under CSRS where the deposit has not been paid in full
  • Deposits have not been paid for FERS creditable non-deduction service
  • VA part time direct medical solutions (DMS)physicians, including doctors, scientists, and surgeons
  • Refunded service creditable towards CSRS non-disability retirement ending on or after 3/1/1991 where the deposit has not been paid
  • Excess LWOP
  • Service that is unverified or missing
  • Where an insurable interest survivor election is made
  • When no survivor election is made
  • Receipt of military retired pay

Here are a few things to consider when you are planning to retire:

  • Caution- Do This Before You Retire
  • Thoroughly complete and review your retirement forms. OPM previously reported that 23 percent of all claims received are missing one or more records and 11 percent are not received during the first 30 days. FERS employees must complete the SF-3107 form, CSRS employees must use the SF-2801 form.
  • Send in your paperwork, if at all possible, 3 to 6 months in advance of your planned departure date. This isn’t possible with VERAs because they typically have a much shorter window of opportunity to apply. (Keep a complete copy of your application for reference)
  • Thoroughly review the package that your personnel office sends you. Check your SCD date, military time, and other pertinent data and make needed corrections.
  • Review What to Expect the First Three Months After I Leave.  If anticipated actions in this normal time line don’t correlate with your situation contact your personnel office and OPM immediately. This step can keep your personnel office and OPM on track.
  • Set aside sufficient funds, six months minimum, for bills and emergencies and have other savings and investments that you can tap if processing delays are extreme. Read How to Be Financially Prepared When You Retire.
  • If you have a divorce decree make sure OPM received a copy at the time of the divorce. Visit our Divorce Forum For more information on this issue. An improperly processed divorce decree can dramatically decrease interim and full annuity payments.
  • When contacting OPM about your retirement payments before you receive your claim number, contact your former payroll office first for the date your records were transferred to OPM. Your payroll office should provide you with the number and date of the Register of Separations and Transfers. You will also need your Payroll Identification Number.

Use our “Federal Employees Retirement Guide” to help you through the process. It takes time to compile your application and review all of the options available to you.  Once you elect an option and your application is adjudicated, many of your benefit elections are irrevocable.

Scheduling A Retirement Benefits Seminar

Federal Employee Benefits Advocates (FEBA) provides comprehensive benefit briefings for Federal employees so they can make informed retirement decisions. Briefings include information on CSRS or FERS Retirement Annuities and all insurance programs including Medicare, the Thrift Savings Plan (TSP), Social Security, disability and other relevant retirement planning topics.

Schedule A Seminar in Your Area

Federal Employee Benefits Advocates (FEBA) provides comprehensive benefit briefings for Federal employees so they can make informed retirement decisions. Briefings include information on CSRS or FERS Retirement Annuities and all insurance programs including Medicare, the Thrift Savings Plan (TSP), Social Security, disability and other relevant retirement planning topics.

Helpful Retirement Planning Tools / Resources

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

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.

Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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1099R Tax Forms Available NOW!

Posted on Wednesday, 22nd January 2020 by

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Our 1099R Tax Forms typically aren’t available until the end of January by regular mail. Registered users of OPM’s Retirement Services Website can download their 1099R now. I visited the site on January 22, 2020 and download my copy early to use with my 2019 tax return.  Last year the 1099Rs were available for download on the 18th of the month. 

Federal Employee Retirement Benefits Seminars – Check Availability

You must be registered to use their 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 to sigh up. However, you may have to wait for your password to be sent via regular US mail and that can take several weeks. Many banks and brokerage house’s 1099-INT, DIV and B reports are also available online for download early. Treasury Direct doesn’t send out print copies. You must download your Treasury’s OID and 1099 INT statements from your online account. If you have complex investments, your brokerage statements could be delayed until mid-March or later. 

I’ve personally used TurboTax software for decades with success. 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 statements into your tax return, saving considerable data entry time. There are a number of free online filing services available through the IRS and several of the tax preparation services. The IRS allows you to file online at no cost if your annual income is less than $69,000.  You will have to file your State tax return separately. Turbo Tax offers free online tax preparation and submission of both your Federal and State returns for simple returns.

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

Request a Federal Retirement Report

Retirement planning specialists provide a comprehensive Federal Retirement Report™ including annuity projections, expenditures verses income, with a complete benefits analysis. This comprehensive 27-page benefits summary will help you plan your retirement.

Request Your Personalized Federal Retirement Report™ Today

Find answers to your questions: The best time to retire, retirement income vs expenditures, FEGLI options and costs, TSP risks and withdrawal strategies, and other relevant topics. Determine what benefits to carry into retirement and their advantages. You will also have the opportunity to set up a personal one-on-one meeting with a CERTIFIED FINANCIAL PLANNER.

Helpful Retirement Planning Tools / Resources

Federal Employee Retirement Benefits Seminars – Check Availability

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.

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

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Notice of Annuity Adjustment and 1099 R Tax Forms

Posted on Saturday, 11th January 2020 by

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In late December of each year federal retirees receive a Notice of Annuity Adjustment that provides abundant information for annuitants and their survivors. Any time your annuity payment is modified, for whatever reasons, OPM sends out a new notice outlining the change and the impact on your annuity. If a COLA is pending, health care premiums change, or your long-term insurance premium increases you will receive a Notice of Annuity Adjustment.

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

This document provides annuity and benefit information for you and your family. It includes the annuitant’s Claim number, the amount withheld for each item deducted from your annuity payment, and your gross and net payment. This document specifies the monthly survivor annuity currently payable in the event of the annuitant’s death and includes an annual Notice of Survivor Annuity Election Rights. You will also find OPM contact information and they include a recommendation to register and log on to their online services.

This form provides instructions on how to make benefit elections such as how to apply for a survivor election for a spouse you marry after retirement, survivor annuity elections for a former spouse, and others.

I elected a full survivor’s annuity for my wife when I retired as a CSRS employee. My wife will receive 55% of my full annuity when I die. The full FERS survivor’s annuity is 50%. I divided the surviving spousal monthly annuity listed on this document by my gross monthly benefit; my wife will receive 60% of what I was receiving while alive. When I elected a full annuity, my annuity was reduced by 10%. What many don’t realize is that the surviving spouse of a CSRS retiree receives 55% of the unreduced annuity amount or in my case 60% of what I was receiving monthly while alive. Many believe the surviving spouse receives 55% of what the federal annuitant was receiving prior to death. This is good information to have when finalizing your estate plans.

I keep the Notice of Annuity Adjustments that I receive in my retirement folder and include a copy in our estate binder along with OPM’s annuity and FEGLI insurance verification forms that OPM sends out upon request. This is an important document and needs to be readily available if you or your survivor need to contact OPM or require benefit clarifications.

I receive many questions each year from retirees and survivors that misplaced their CSA retirement Claim Number and need to contact OPM. If you file this form in your retirement planning or estate file this information will be readily available when needed.

1099 Tax Forms Coming Soon

Federal annuitants typically don’t receive their 1099R Tax Forms until the end of January or the beginning of February by regular mail. If you are registered to use OPM’s Retirement Services Website your 1099 R is often available by mid-January for download. I generally download a copy of my 1099 R to start my tax return early.

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. If you haven’t signed up yet do it now. The site offers retired federal employees many helpful options such as changing your direct deposit information, address changes, 1099 R copies, download annuity and insurance verification documents, and much more.

Scheduling A Retirement Benefits Seminar

Federal Employee Benefits Advocates (FEBA) provides comprehensive benefit briefings for Federal employees so they can make informed retirement decisions. Briefings include information on CSRS or FERS Retirement Annuities and all insurance programs including Medicare, the Thrift Savings Plan (TSP), Social Security, disability and other relevant retirement planning topics.

Schedule A Seminar in Your Area

Federal Employee Benefits Advocates (FEBA) provides comprehensive benefit briefings for Federal employees so they can make informed retirement decisions. Briefings include information on CSRS or FERS Retirement Annuities and all insurance programs including Medicare, the Thrift Savings Plan (TSP), Social Security, disability and other relevant retirement planning topics.

Helpful Retirement Planning Tools / Resources

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

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.

Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SURVIVOR INFORMATION

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3.1% GS 2020 Pay Raise – Pay Charts Now Available

Posted on Monday, 30th December 2019 by

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Those planning to retire soon will benefit from the pay raise in a number of ways. Primarily, your annual leave buy back will be at the new pay rate starting the first pay period of 2020. If you plan on staying another year or longer the raise will increase your high three average earnings that is used to determine your monthly annuity. Retirees ended up with a small 1.6% COLA this year, leaving retirees a little behind the curve when taking inflation into consideration.

Federal Employee Retirement Benefits Seminars – Check Availability

Federal civilian employees will see an average 3.1% pay increase starting January 1, 2020; a 2.6% increase in basic pay, with an average 0.5% increase in locality pay. The pay increases for GS employees ranges from 2.85% to 3.52%.

The President signed an Executive Order on December 20th officially averting a second government shutdown in 2019.  The 3.1% pay raise 2020 charts are now available along with new paid parental leave benefits providing all federal employees with up to 12 weeks of paid parental leave per year.

The pay raise will take effect with the first full pay period of 2020, which begins Jan. 5. We published the new pay table on December 26th including the locality pay area definitions outlining the pay rates for all regions nationwide.

The rates of basic pay or salaries are included for the following list of statutory pay systems:

  • The General Schedule
  • The Foreign Service Schedule
  • schedules for the Veterans Health Administration of the Department of Veterans Affairs
  • Senior Executive Service
  • Certain Executive, Legislative, and Judicial Salaries
  • The Executive Schedule

This was the largest annual increase since 2009 when federal employees received a base rate increase of 2.9%. OPM was fast to react to the Presidential Order and released the new tables the day after Christmas.

Following are links to the new 2020 tables, including locality adjustments:

Click here for: Special Rates Tables

Request a Federal Retirement Report

Retirement planning specialists provide a comprehensive Federal Retirement Report™ including annuity projections, expenditures verses income, with a complete benefits analysis. This comprehensive 27-page benefits summary will help you plan your retirement.

Find answers to your questions: The best time to retire, retirement income vs expenditures, FEGLI options and costs, TSP risks and withdrawal strategies, and other relevant topics. Determine what benefits to carry into retirement and their advantages. You will also have the opportunity to set up a personal one-on-one meeting with a CERTIFIED FINANCIAL PLANNER.

Helpful Retirement Planning Tools / Resources

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.

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

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Safety, Health & Convenience – The Apple Watch Connection

Posted on Saturday, 14th December 2019 by

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I have a medical condition called Paroxysmal Atrial Fibrillation (PAF), intermittently my heart goes into arrhythmia. This past year I ended up in the emergency room when I wasn’t able to control the attack with traditional methods. The ER doctor asked if I took my EKG with my Apple watch during the attack. Unfortunately, I had the older series 3 version that doesn’t have this feature.  A watch that can take an EKG! Unbelievable, but true. It’s amazing what they can jam into a small package these days. Recently, I ungraded to a Series 5.

 

Eight Apps Located on Face of Watch

 

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

I purchased my new series 5 GPS model during black Friday.  You can buy two versions, a GPS or a GPS + cellular model. The cellular model is an actual cellphone that you can use independent of your standard iPhone. The GPS model requires your iPhone to be close by to use some of the functions. I was hesitant because I have so many hi-tech devices; setup can be tricky and nerve racking to say the least. That wasn’t the case for my new Apple series 5 watch. I gave my series 3 watch to my wife and initiated the setup on my iPhone for my new watch. When you sync another Apple watch to your iPhone it turns on your phone’s camera. You simply point the camera at the face of your new watch and it automatically sets it up plus transfers all of your existing aps to your new watch. It was easy to set up and anyone can do it.  Now my wife and I both have Apple watches.

 

Traditional Face – One of Many Available

 

The functions, called apps, are truly amazing. The Activity app tracks the number of steps you take daily, the miles you traveled, and how many times you went up and down a flight of stairs. It also tracks how often you stand, move and exercise. The heart rate function tracks and graphs your heart rate throughout the day and night. You can visually see your heart rate graph for the entire day with the high, low, average and resting heart rates!

 

 

One of my favorites is the ECG, equivalent to an EKG function. Just tap the icon for this function on your watch, place your finger lightly on the side button, and it records a 30 second EKG. It displays the results and will let you know if you are in A Fib. Go to the health app on your phone to review the entire 30 second EKG and you can send a copy to your doctor. Not only will this app perform an EKG, it monitors your heart throughout the day and will vibrate if you go into A Fib. You can also set high and low heart rates and the watch vibrates if you exceed these limits. It will sense an A Fib attack coming often before I am aware of it. This early warning allows me to take magnesium that I use to control this condition during the early stages of the event before it gets too far along.

 

 

There are a number of safety features that can be life-saving. You can call 911 in an emergency. They have a function that senses when you fall and if you don’t move for 1-minute they call 911 and give them your location! I accidently triggered this function when I took off my watch and put it down too hard on the bathroom counter one night. The watch began vibrating and several prompts showed up on the screen. One for 911, and two others stating “I fell but you are OK” or that “I didn’t fall .” You can tap on 911 if you need help immediately, if you don’t respond or move for 1-minute they call 911 for you. A great feature for those living alone.

 

Heart Rate Monitor

Ahead of my doctor’s appointment the other day the watch announced that I should leave for the appointment 25 minutes before the scheduled time, traffic was light with an 18-minute commute! The new series 5 has an always on feature where you don’t have to turn your wrist to activate the display like the older series. I turned this off because it drains the battery and requires more frequent charges. The watch goes about 2 days between charges because I wear mine night and day. My wife turns hers off at night and she charges her watch every 4 or 5 days.  It even tracks a woman’s menstrual cycle! These are some of the Apple watch’s unique and helpful apps:

  • Clock
  • World clock
  • Stop watch
  • Multi-function timer
  • Alarm
  • Calculator
  • Activity tracker
  • EKG
  • Pulse rate
  • Weather and alerts
  • Scheduler & event tracker
  • Compass
  • Activity tracker
  • Email notifications
  • Audio books
  • Music player
  • Radio
  • Walkie-Talkie function
  • Menstrual cycle tracking
  • Sound Level (db) detection with alerts
  • SERI queries
  • Messages
  • Voice recorder
  • Breathing alerts
  • Maps & GPS
  • Multiple watch faces
  • Picture display
  • Apple pay, you can pay for products and services with your watch

The Apple Watch is a worthwhile investment and I use mine frequently throughout the day. When I cook, I use the timer. I target 10,000 steps a day and it reminds you when you are too inactive. In the winter months I walk between 7,000 to 10,000 steps daily, summer months I average 10,000 to 12,000.  My wife beats me every day averaging 10,000 + steps daily year-round. When I’m out and about I use the voice recorder to capture things that I don’t want to forget. I’m constantly asking SERI for help. I press the side button and say things like “How old is Clint Eastwood” when watching one of his movies or “What time is the Steeler game on today?” SERI faithfully replies to my requests.  I display family photos of our grandkids on my watch when I’m not using one of its other functions; you can display any picture that resides on your cell phone.

 

Use the Display For Favorite Pictures

If you decide to buy an Apple watch be sure to get the series 4 or 5 if you want the EKG function. For me it was well worth the cost, $359 for the peace of mind and convenience that it offers.  I purchased the 40 mm, they have a larger 44 mm size, it’s about $50 more. Look for sales and the longer the Series 5 is out the lower the price will be. You have to have an iPhone to sync and use your Apple watch. Unfortunately, android phones won’t sync to the Apple watch.

Scheduling A Retirement Benefits Seminar

Federal Employee Benefits Advocates (FEBA) provides comprehensive benefit briefings for Federal employees so they can make informed retirement decisions. Briefings include information on CSRS or FERS Retirement Annuities and all insurance programs including Medicare, the Thrift Savings Plan (TSP), Social Security, disability and other relevant retirement planning topics.

Schedule A Seminar in Your Area

Federal Employee Benefits Advocates (FEBA) provides comprehensive benefit briefings for Federal employees so they can make informed retirement decisions. Briefings include information on CSRS or FERS Retirement Annuities and all insurance programs including Medicare, the Thrift Savings Plan (TSP), Social Security, disability and other relevant retirement planning topics.

Benefits Administration Letter 11-104 requires agencies to educate employees on how to plan for retirement. FEBA assists Federal agencies to comply with this directive. HR departments can Contact FEBA to schedule briefings for their area.

Helpful Retirement Planning Tools / Resources

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

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.

Posted in LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SURVIVOR INFORMATION, WELLNESS / HEALTH

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BCBS Basic to GEHA Standard Comparison + Medicare & You

Posted on Friday, 29th November 2019 by

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Prior to Medicare eligibility, when you are under age 65, many elect high option plans to reduce their exposure to deductibles, coinsurance, and copayments. However, when you turn 65 and enroll in the traditional Medicare A & B options, it often makes sense to switch to a lower cost plan. Most Federal Employee Health Benefit (FEHB) plans pick up these fees.

2020 FEHB Plan Selection Guide

Section 9 of all plan brochures, titled Coordinated Benefits with Medicare & Other Coverage, provides charts that clearly state what you would pay with and without Medicare.  I reviewed the Blue Cross Blue Shield (BCBS) Basic and the GEHA Standard 2020 Plans for this article. It should be noted that similar savings are available with most FEHB plan providers when enrolled in Medicare A & B.

When I review plans, I always discover features that I wasn’t aware of, this article highlights one from Blue Cross and Blue Shield, a potential $1,600 bonus for a family Basic Plan enrollment. The GEHA Standard Plan no longer requires preauthorization for physical, occupational, and speech therapy plus they now provide four pairs of compression stockings per calendar year without a preauthorization requirement. Their High Option Plan now offers a Medicare reimbursement of $600.

Federal Employee Retirement Benefits Seminars – Check Availability

Blue Cross & Blue Shield Basic Plan

Note: The Blue Cross & Blue Shield Basic Plan cost-share when Medicare is your primary payer and your provider is in their network.

  • Monthly Cost – Basic Option Self + 1 = $386.99
  • Limited to in-network providers. If you are treated by an out-of-network provider or facility you are responsible for all costs that Medicare doesn’t cover including Medicare deductibles. Many if not most of the physicians and medical facilities are in their network. However, to avoid extra charges, you should always check with medical providers before services are rendered if you enroll in this plan.
  • Review the Blue Cross Blue Shield Medicare & You Booklet for specifics.
  • Offers a $800 reimbursement for their Basic Option Plan participants. Up to $1,600 under a Self Plus One or Family Plan enrollment.

 

Reimbursement Clarification:  Blue Cross & Blue Shield states, “Each eligible member on a contract has their own $800 benefit in 2020.” I called to confirm this. If you are enrolled in a Self + One or Family BCBS Basic plan, and you and your spouse are enrolled in parts A and B, and paying Medicare premiums, both annuitant and spouse receive up to $800 per year, $1,600 combined.

You have to apply for the reimbursement and provide specific documentation that you made Part B premiums for the year. Reimbursement details are available online and you must apply after accumulating $800 in Medicare Part B premiums, not before.

GEHA Standard Plan

Note: GEHA Plan cost-share. Deductibles, copays and coinsurance are waived whether your provider is in- or out-of-network.

  • Monthly Cost – Standard Option Self + 1 = $282.05
  • Provides coverage for in and out-of-network providers
  • The GEHA Standard Plan includes vision care services, a separate plan isn’t needed.
  • No Part B reimbursement for their Standard Plan, $600 reimbursement for High Option Plan participants.
  • Review the GEHA Medicare & You Booklet for specifics.

Plan Comparison

Both plans provide traditional coverage at affordable costs and coverage extends nationwide and overseas. There are differences in coverage in general and prescription coverage that you need to evaluate depending on the costs of your current medications and whether or not they are generic, name brand, or non-preferred brand-names.  Both prescription plans are comprehensive. Blue Cross and Blue Shield Basic has a 5 Tier system with copays ranging from $10 for Tier 1 to as high as $90 for Tier 5 at preferred retail pharmacies. You can use in an out-of-network pharmacies with both plans.

GEHA Standard has three prescription drug levels; Generic, Preferred brand-name, and non-preferred brand-name groups. Copays range from $10 for generic to 50% for preferred and non-preferred. They have max limits set for both.  If you have high cost prescriptions it often pays to shop around and compare pricing at several pharmacies in your area. One study found that the same prescription cost between pharmacies varied by as much as 75%. What I typically do before filling a high cost new drug prescription is visit the manufacturer’s website and search for coupons. We reduced our copayments dramatically using this method. The copayment for one of my prescriptions, Asmanex Twisthaler, was orignally $150. The maufacture’s coupon reduced my copay to $65.

For those not on Medicare GEHA Standard has a deductible of $350 for Self and $700 for the Self Plus One Plan for the calendar year. BCBS has no deductible for their Basic Plan.

Comparing costs is not always what it seems. You have to weigh all factors.  GEHA’s Self Plus One Standard plan costs annuitants $282.05 per month. BCBS Basic charges $386.99. However, BCBS Basic offers up to $800 a year Medicare premium reimbursement, $1,600 for a married couple if both are enrolled in Medicare A and B. GEHA only offers Medicare reimbursement for their High Option Plan. That reimbursement will offset your annual costs but you still pay the full amount each month and apply for reimbursement after you paid at least $800 during the year to Medicare.  Other costs also have to be considered such as prescription costs and BCBS Basic doesn’t cover any out-of-network costs that could be substantial.

There are many areas to compare before deciding on the plan that is right for you. Use our 2020 FEHB Plan Selection Guide to help you make an informed decision this open season.

Request a Federal Retirement Report

Retirement planning specialists provide a comprehensive Federal Retirement Report™ including annuity projections, expenditures verses income, with a complete benefits analysis. This comprehensive 27-page benefits summary will help you plan your retirement.

Request Your Personalized Federal Retirement Report™ Today

Find answers to your questions: The best time to retire, retirement income vs expenditures, FEGLI options and costs, TSP risks and withdrawal strategies, and other relevant topics. Determine what benefits to carry into retirement and their advantages. You will also have the opportunity to set up a personal one-on-one meeting with a CERTIFIED FINANCIAL PLANNER.

Helpful Retirement Planning Tools / Resources

Federal Employee Retirement Benefits Seminars – Check Availability

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.

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

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Open Season Health Plan Review & Changes

Posted on Sunday, 24th November 2019 by

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Each year during open season I request brochures from providers of interest and review Section 2 to see what is changing for the new year. I also review Section 9 to confirm what each plan covers when you are enrolled in Medicare and check the coverage for areas where we know we will need services in the upcoming year. 

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

I’ve been with GEHA Standard, the MetLife Standard Dental Plan and FEP Blue High Option Vision care plans for many years and they have served my wife and I well. Most years, I review the plan brochures for program changes and haven’t had a reason to change until this year. I attended a FEHB Open House at the Greater Pittsburgh International Airport’s Air Traffic Control Tower to compare plans with health provider representatives. This is where I worked prior to retiring and I was also able to catch up with fellow workers and old friends.

2020 FEHB Plan Selection Guide

The GEHA and Blue Cross Blue Shield handouts covered their plan offerings in colorful illustrated brochures for their 2020 Medical Benefits, Dental Benefits, Vision Care, and Medicare Benefits. There were three companies at the fair, GEHA, Blue Cross Blue Shield and UPMC. I believe all of the companies provide similar brochures that you can request from the providers. The GEHA brochures were exceptional with color tabs and I was able to go immediately to the section of interest.  Their representative, John Repici was very helpful and answered all of my questions. 

The plan brochures along with OPM’s FEHB Plan Comparison Tool and the BENEFEDS’ Plan Comparison Tool simplified my review and helped me select the best coverage for our changing circumstances. Register online at www.BENEFEDS.com to review and download plan brochures, use their plan comparison tool, and to initiate a change.

I’ve had a number of back and neck problems this last year and needed a plan that covers extensive chiropractor care. Hearing aids are another consideration and we travel and may not always find an in-network provider so that too was a factor. 

After comparing several plans including Blue Cross Blue Shield Basic to GEHA Standard we decided to stay with GEHA Standard, it made sense for us plus the Blue Cross Blue Shield Basic plan doesn’t cover anything for out-of-network providers. The monthly premium for GEHA’s Self Plus One Standard plan was only $282.05 compared to $386.99 for Blue Cross Blue Shield’s Basic, a monthly savings of $104.94.  We use this savings to offset our Medicare Part B premium costs.

Since my wife and I have Medicare A & B it made sense for us to enroll in a lower cost FEHB plan because most FEHB plans pick up the vast majority of our co-insurance, co-payment and deductible costs for Medicare enrollees. Since my wife and I signed up for Medicare about 5 years ago, we haven’t paid any deductibles, co-insurance or co-payments except for prescriptions.

After reviewing dental plans, we decided to move from MetLife Standard to a GEHA Standard plan. The cost savings were minimal, about a dollar monthly. The big difference was the increased coverage from $1,500 per person per year to $2,500 a person. A $1,000 increase in coverage for each of us. With the GEHA Standard plan you don’t pay anything for preventive care for in or out-of-network providers and there were other savings such as paying 15% less for out-of-network intermediate services. The comparison that I ran on BENEFEDS.com helped me make my decision. I initiated the change online and received a confirmation within a few minutes.

There are reasons for those needing orthodontic care to be cautious. With GEHA Standard and the FEP Blue Dental Standard plans you have a 12-month waiting period before you can use their orthodontic services. If you have young children that will need orthodontic care shortly consider MetLife, the FEP Blue Dental High Option plan, the GEHA High Option Plan and other plans that don’t require a waiting period.  The FEP Blue high option provides unlimited maximum annual coverage for in-network providers and GEHA offers the same for both in and out-of-network providers.

There is a lot to consider this open season.  Use our 2020 FEHB Plan Selection Guide to find all of the information you need to make an informed health care plan decision this open season.

Scheduling A Retirement Benefits Seminar

Federal Employee Benefits Advocates (FEBA) provides comprehensive benefit briefings for Federal employees so they can make informed retirement decisions. Briefings include information on CSRS or FERS Retirement Annuities and all insurance programs including Medicare, the Thrift Savings Plan (TSP), Social Security, disability and other relevant retirement planning topics.

Schedule A Seminar in Your Area

Benefits Administration Letter 11-104 requires agencies to educate employees on how to plan for retirement. FEBA assists Federal agencies to comply with this directive. HR departments can Contact FEBA to schedule briefings for their area.

Helpful Retirement Planning Tools / Resources

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.

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

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The Ultimate Retirement Planning Guide – Start Now!

Posted on Friday, 15th November 2019 by

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Retirement is more of a destination unlike a planned vacation where you return to work a few days after the trip is over.  Whether you are going on vacation or planning your retirement you have to research and prepare to make the event truly remarkable.

Carole, one of our newsletter subscribers, asked if I had any suggestions on what she should be looking at to plan her retirement. There are many things to consider and I sent her a list of articles and resources that will take her step-by-step through the process. If you are considering retiring it is never too early to start planning your exit, the more time you put into the effort the better off you will be when you walk out the door.

I expanded the list I sent Carole and it should help anyone planning their retirement to understand their options and the path forward.  Please forward this to anyone in your organization that is at or approaching retirement age, it can help them avoid delays and problems that can be encountered when preparing for retirement.  You can also download this guide in PDF format to add to your desktop and also forward to others in your organization.

NOTE: A number of federal agencies disable links that arrive in email messages. You will find this article in PDF format and online on our blog at www.fedretire.net, the links will be active there.

Retirement Planning:

A Year or More Before Leaving

  • What Should I be Doing the Year Before I Retire
    • Suggestion: Keep a copy of your last Leave & Earnings Statement (LES) with your retirement paperwork. This form will have your military credits if warranted and other valuable information that you may need down the road.
  • The Best Day to retire – Select several potential retirement dates.
    • Request annuity estimates from your HR office for the dates selected.
    • How is My Annuity Calculated
    • Annuity Projection Calculator – This spreadsheet accurately determines your projected monthly and annual annuity, based on a selected growth rate, with and without survivor benefit for forty years and your projected survivor’s annual and monthly annuity.
  • Download our Leave & Schedule Excel Chart. These FREE updated chart tracks all leave balances. Place this chart on your desktop to track your work schedule and all leave balances. They are helpful when selecting target retirement dates and to build your sick leave and annual leave balance that you can cash in when you retire.
  • Looking at the Numbers – The Second Time Around – Financial Review
  • FEGLI insurance – What options to carry into retirement.
  • Health Care Consideration – Federal Employees Healthcare Benefits (FEHB)
    • General Guidance
    • 2020 FEHB Selection Guide
    • Qualifying Life Events – If you plan to relocate when you retire, you have 60 days to change your FEHB coverage after a move. There are many other life events that permit changes including: divorce, marriage, when you reach age 65, and death of the annuitant or spouse.
  • Retirement Applications – Download the application at least 6 months before your departure date and prepare a draft, follow the instructions noted on the forms. As you fill out the application, questions will arise. The earlier you prepare the draft the more time you will have to get the answers you need to make informed decisions about your benefits. The instructions are comprehensive, many of your questions will be answered in these instructions. Keep a copy of the application you submit for future reference. Submit your application at least three months in advance of your targeted retirement date if possible. This gives HR sufficient time to confirm your creditable service and process it locally before sending it off to OPM.
  • Veterans (Military Credit) – It can take up to a year to process your military credits and the military payroll offices often are slow to respond. The rules are different for CSRS and FERS employees and you should understand the impact on your annuity. FERS employees must make a military deposit to receive credit for military years served when they retire.If you are approaching retirement, and you bought back your military time, confirm that your Leave and Earnings Statement (LES) lists the payback amount on your biweekly statements. Some federal employees have problems with confirming payback when retiring and it is important to keep all records of your payments and check with your personnel office to ensure this information is in your OPF or eOPF prior to retiring.

Medicare – What to do when you turn 65

If you are retired and receiving Social Security you will automatically be enrolled in Part A and B and should receive your Medicare card three months before your 65th birthday. If you decide not to take Part B follow the instructions that you receive with your enrollment package. If you aren’t receiving Social Security you have a 7-month Medicare enrollment window that starts 3 months before your birthday.  You can sign up online at https://www.socialsecurity.gov/medicare/apply.html or you can visit your local Social Security Office to apply. Call 1-800-772-1213 for additional information and assistance. You can also sign up for Medicare at https://www.medicare.gov under the “New to Medicare” section. It takes about 15 minutes to register and sign up online.

If you are retired but covered under a working spouse’s medical plan or you are still working, sign up for Part A and then advise them that you do not want part B because you are covered by your employer or under a working spouse plan as the case may be.  All current federal employees and those retirees with new employer health care coverage or are covered under their spouse can elect this when they turn 65 to delay Part B without penalty until their working spouse retires, or they leave federal service, or their new employer.

Retirement Planning Information – Find the retirement planning information you need.

After Retirement – What to expect from OPM.

Request a Federal Retirement Report

Retirement planning specialists provide a comprehensive Federal Retirement Report™ including annuity projections, expenditures verses income, with a complete benefits analysis. This comprehensive 27-page benefits summary will help you plan your retirement.

Find answers to your questions: The best time to retire, retirement income vs expenditures, FEGLI options and costs, TSP risks and withdrawal strategies, and other relevant topics. Determine what benefits to carry into retirement and their advantages. You will also have the opportunity to set up a personal one-on-one meeting with a CERTIFIED FINANCIAL PLANNER.

This information should help you prepare for your retirement. I personally developed our Retirement Planning Guide for personal reasons. When I retired from federal service in 2004, I couldn’t find the information I needed to make informed decisions. If you are planning your retirement subscribe to my Federal employees Retirement Planning Newsletter to better understand your retirement options and benefits. I send out monthly email newsletters discussing federal benefits and retirement planning issues.

Use all of the resources available including the retirement specialist in your agencies HR office. They can help. You can print out this guide plus I converted the article to a PDF format that you can download and place on your desktop. Send the PDF file to others in your group to use and place on their desktop while planning their retirement. Just open the PDF file and click on each link of interest to explore your options.

Dennis V. Damp, retired
Copyright 2019, Bookhaven Press LLC

Helpful Retirement Planning Tools / Resources

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.

Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, EMPLOYMENT OPTIONS, ESTATE PLANNING, FINANCE / TIP, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION, WELLNESS / HEALTH

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