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Contacting OPM, FEHB Changes, and Updates

Posted on Sunday, 23rd June 2013 by

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Recently, due to budget cuts, OPM reduced their call-center’s hours and they are now open from 7:40 a.m. to 5 p.m. Eastern Time. To talk to a retirement consultant, report an annuitant’s death, request a duplicate 1099 R or other issues call their toll free number at 1-888-767-6738. For those in the DC area call 202-606-0500. You will also find other web based options for contacting OPM and reporting deaths on our updated Retiree’s Master Contact List that you can download and keep with your retirement paperwork.  

Retirement claims processing has improved dramatically this year with outstanding retirement processing claims dropping over 50% since January. Even with reduced hours and the sequestration OPM has been able to streamline the process and expedite approvals to reduce the backlog.  

FEHB Changes and Proposals

Next year OPM will have more vendors to choose from, a total of 10 for the dental program and 4 for vision.  The approved vendors are listed below and rates will be published this fall.

Dental Care Vendors:

  • Aetna
  • MetLife
  • United Concordia
  • GEHA
  • Blue Cross Blue Shield
  • Delta Dental
  • Triple S
  • Dominion Dental
  • Humana
  • Emblem Health

Approved Vision Plan Vendors:

  • Aetna
  • Blue Cross Blue Shield
  • VSP
  • United Healthcare

A major change to the FEHB rate structure is being supported by OPM according to Mike Causey, host of the Federal News Radio Show.  OPM is now supporting the self-plus-one FEHB subscription plan similar to how the dental care program now works. This would provide considerable savings to retirees who would be able to reduce their coverage cost from family to self-plus-one.  This would also make it easier for retirees to select and pay for Medicare Part B.  Many retirees already pay for higher cost family coverage and are hesitant to take on another $100 a month or more to pay for Part B.  

Updates

Cynthia Compton-Conley, Ph.D. contacted me last week concerning my “New and Bigger Isn’t Always Better” article that discusses the problem I have hearing TV program and movie audio.  Cynthia is retired CSRS and an audiologist and former professor at Gallaudet. She works with hearing loss and developed a comprehensive website with tutorials on room acoustics and hearing loss along with other very helpful information and links. If you too are having hearing problems, Cynthia states that one in 10 Americans have hearing loss, visit her web site at www.soundstrategy.com. I took their free hearing assessment inventory and found the information very helpful.  She was also able to explain why I’m having this problem and proposed suitable remedies tailored to my personal situation.

FREE Career Planning Guide for federal Employees

Take Charge of Your Federal Career is a practical, action-oriented career management workbook that assists employees with the preparation of realistic Individual Development Plans (IDPs). Packed with proven tips and valuable assessment and evaluation tools, this unique workbook provides federal workers with the individualized know-how and guidance they need to identify, obtain, and successfully demonstrate the skills and experience required to qualify for new and better federal jobs. I wrote this book based on my 36 years of federal work experience.  We are offering 30 copies, one case of books, to federal training offices and supervisors for $84, the cost of shipping and handling, to introduce agencies and federal offices to this succinct career planning workbook.  Pass this on to your training departments and supervisors in your unit. The book is 8 ½” x 11” 216 page perfect bound workbook that will help federal employees plan their careers. Order online or call 800-782-7424. Ask for Special Offer IDP-1432.

Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at  https://fedretire.net to read all forum articles.

Visit our other informative sites

Helpful Retirement Planning Tools
Distribute these FREE tools to others that are planning their retirement

The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in ANNUITIES / ELIGIBILITY, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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New and Bigger Isn’t Always Better

Posted on Friday, 14th June 2013 by

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Have you noticed how big, bright, and clear the new large flat screen digital HD TVs are these days? We purchased our first flat screen about 5 years ago and my wife and I were truly impressed with the picture; a significant improvement over the analog TVs that we grew up with. However, it didn’t take long to realize that the sound quality of these new sets was significantly inferior, especially when watching movies and TV series like Revenge where the voices are muted and garbled.  Oddly, sports, news and general programming audio is fine, we can understand the conversation at reasonable volume levels. While watching movies my wife and I often ask each other “what did they say” and by the time we work it out we end up missing more content. I’ve talked with many others experiencing the same problem and It‘s very frustrating to say the least. 

Over the years we suffered through this by turning up the volume to the point where it was almost unbearable; and I wear hearing aids!  After researching the problem I discovered that the new sets are so thin that the tiny speakers they use don’t have the fidelity needed for voice clarity and center channel reproduction where most of the voice and dialog is produced.  The old TV sets had larger high fidelity speakers. To make things worse yet, many flat screen manufactures eliminated the audio out jacks that can be used for remove speakers or wireless headsets.

I talked to numerous audio specialists and visited online forums about this issue and most recommended a sound bar or surround sound systems which cost anywhere from $100 to several thousand dollars!

My first attempt to address the problem was to purchase a $90 Insignia sound bar from Best Buy. It increased the volume and added more base plus offered three listening modes of which none helped. Recently an audio department sales representative recommended spending $300 or more to get the sound quality we desired.  The LG sound bar with wireless base cost us just under $300 from Sam’s Club and I returned it two days later. Movie and TV series audio was still garbled however the system did fill the room with sound and heavy base, the louder base and surround sound just made the problem worse.

Next we tried the Bose Solo system. Fortunately we have a Bose outlet store close by and I was able to pick it up for $349 plus tax. I hooked up the Solo and experienced the same problem. The demos in the store were crystal clear however most of the demos are action scenes with little conversation. Needless to say we returned the Bose Solo the next day and the sales rep suggested that we should try their $1400 sound bar with external base to achieve the clarity we needed.  The $1400 unit allows users to calibrate 5 locations in a room using a headset.  If we went that route we would have a total invested of $900 for my LG 47 inch TV and to hear it we only need to spend $1400 more!!!

I decided to try other alternatives including closed caption and researched wireless headsets. After reading numerous reviews I purchased a Sony wireless headset, 900 MHZ model number MDR-RF985RK, from Amazon.com for $86.00. One of the benefits of the 900MHZ model is the range which is about 150 feet and you don’t have to be line of site like the infrared models. The instructions call for using the TV’s audio output. Unfortunately, the large flat screen TV manufacturers saw fit to remove this feature and I was told that we needed to purchase a home theater system and connect to their audio output, another frustrating moment. Fortunately we have Comcast cable and I did find an audio output jack on the back of their DVR and cable box. It works fine except there is a delay in the audio and if we have the TV audio volume up too high it is distracting.  

I can now hear clear dialog with these headsets and they pick up all of the background sounds as well.  I was listening to the Voice last night and the fidelity was exceptional. The transmitter for the headphones sits next to the TV stand and also charges the headsets when they aren’t in use. The charge lasts for 25 hours, not bad, and it is a relief to hear what is going on. I find it disconcerting that TV manufactures would market sets with such poor audio quality. The picture is great but if you can’t hear what’s going on what good are they? Before I buy another TV I’m going to check the reviews for picture AND audio quality.  

FREE Career Planning Guide for federal Employees

Take Charge of Your Federal Career is a practical, action-oriented career management workbook that assists employees with the preparation of realistic Individual Development Plans (IDPs). Packed with proven tips and valuable assessment and evaluation tools, this unique workbook provides federal workers with the individualized know-how and guidance they need to identify, obtain, and successfully demonstrate the skills and experience required to qualify for new and better federal jobs. I wrote this book based on my 36 years of federal work experience.  We are offering 30 copies, one case of books, to federal training offices and supervisors for $84, the cost of shipping and handling, to introduce agencies and federal offices to this succinct career planning workbook.  Pass this on to your training departments and supervisors in your unit. The book is 8 ½” x 11” 216 page perfect bound workbook that will help federal employees plan their careers. Order online or call 800-782-7424. Ask for Special Offer IDP-1432. 

Recent Forum Host Articles:

Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at  https://fedretire.net to read all forum articles.

Visit our other informative sites

Helpful Retirement Planning Tools
Distribute these FREE tools to others that are planning their retirement

The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in UNCATEGORIZED

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Phased Retirement Update – Guidelines Released

Posted on Saturday, 8th June 2013 by

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The new phased retirement program will permit those eligible to gradually work their way into full retirement. If they don’t like what they see they can opt out and return to full time, can’t ask for much more than that plus phased retirement will increase your annuity when you do decide to pull the plug.   

OPM issued proposed phased retirement guidelines on June 5th 2013 and comments are due back to OPM by August 5th.  The proposed regulations inform agencies and employees about who may elect phased retirement, what benefits are provided in phased retirement, how an annuity is computed during and after phased retirement, and how employees fully retire from phased retirement.

Phased retirement permits an individual to retire from part of his or her employment, while continuing employment on a part-time basis and continuing to earn additional retirement benefits proportionately based upon the additional part-time employment. An eligible employee who enters phased retirement, which requires the approval of an authorized agency official, will work half-time and will receive one half of what his or her annuity would have been had the individual retired completely from Federal service. During phased retirement, he or she is a part-time employee, not a reemployed annuitant.

Phased retirement will encourage the most experienced Federal employees to continue part time, and will operate as a tool to ensure continuity of operations for agencies. The main purpose of phased retirement is to enhance mentoring and training of the employees who will be filling the positions of more experienced employees who are preparing for full retirement. It is intended to encourage experienced employees to remain, in at least a part-time capacity, while less experienced employees are preparing to assume the duties of the employees who are planning to retire.

A person who enters phased retirement (hereafter a “phased retiree,”) would receive more income than he or she would earn by simply changing to a part-time work schedule or by simply retiring, while continuing to share knowledge and expertise with the next generation of Federal leaders via mentoring and role-modeling. Once these individuals fully retire, they will be entitled to a greater annuity than if they had fully retired at the time of transition to phased retirement, but less than if they had continued employment on a full-time basis.

Participation is entirely voluntary, and requires the mutual consent of both the employee and employing agency. An employee does not have an entitlement to phased retirement. In order to participate, an individual must have been employed on a full-time basis for the preceding three years. Under the Civil Service Retirement System (CSRS), the individual must be eligible for immediate retirement with at least 30 years of service at age 55, or with 20 years of service at age 60. Under the Federal Employees’ Retirement System (FERS), the individual must be eligible for immediate retirement with at least 30 years of service at MRA (minimum retirement age, which ranges between age 55 and 57 depending upon year of birth), or with 20 years of service at age 60.

The law provides that employees subject to mandatory retirement (including Law Enforcement Officers, Firefighters, Nuclear Materials Couriers, Air Traffic Controllers, Customs and Border Protection Officers, or members of the Capitol Police or Supreme Court Police) may not participate. However, certain employees who are exempt from mandatory separation and retirement (such as Customs and Border Protection Officers exempted from mandatory retirement when special retirement provisions for Customs and Border Protection Officers were first enacted) may participate. This exemption does not apply to individuals for whom mandatory retirement has been waived, but only to individuals not subject to mandatory retirement by statute.

You can review the entire OPM proposal by visiting our phased retirement page and clicking on the link.  More to come as comments are reviewed and final regulations issued hopefully later this year.

FREE Career Planning Guide for federal Employees

Take Charge of Your Federal Career is a practical, action-oriented career management workbook that assists employees with the preparation of realistic Individual Development Plans (IDPs). Packed with proven tips and valuable assessment and evaluation tools, this unique workbook provides federal workers with the individualized know-how and guidance they need to identify, obtain, and successfully demonstrate the skills and experience required to qualify for new and better federal jobs. I wrote this book based on my 36 years of federal work experience.  We are offering 30 copies, one case of books, to federal training offices and supervisors for $84, the cost of shipping and handling, to introduce agencies and federal offices to this succinct career planning workbook.  Pass this on to your training departments and supervisors in your unit. The book is 8 ½” x 11” 216 page perfect bound workbook that will help federal employees plan their careers. Order online or call 800-782-7424. Ask for Special Offer IDP-1432. 

Recent Forum Host Articles:

Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at  https://fedretire.net to read all forum articles.

Visit our other informative sites

Helpful Retirement Planning Tools
Distribute these FREE tools to others that are planning their retirement

The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, EMPLOYMENT OPTIONS, RETIREMENT CONCERNS

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Earning Extra Income in Retirement and Having Fun at the Same Time

Posted on Thursday, 30th May 2013 by

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Retirees and employees alike often need extra income to just get by, pay off debt, or to save for special occasions or a rainy day.  There are many part time job offers that you must be cautious of such as advertisements that offer unrealistic wages and annual incomes with little work involved.  Real opportunities take commitment and time that you must be willing to contribute to the cause. There are numerous profitable opportunities in both the traditional and non-traditional work venues if you know where to look and with some of the new freelance opportunities you can have a lot of fun along the way.

This is especially good news for experienced federal retirees that often have extensive knowledge and skills in their specialty and are willing to share it with others.  Our Federal Retiree Jobs Board is a good place to start for those interested in traditional work with contractors and companies in the private sector. Private sector companies list their job vacancies on our site to attract federal retirees for their skills or for the dependability and work ethic that federal workers are well known for.  The Jobs Board offers thousands of job listings for most occupations that you might like to explore.

Request a Retirement Benefits Summary & Analysis from a local adviser.  Includes projected annuity payments, income verses expenses, FEGLI, and TSP projections.

Today with the advent of the Internet, digital cameras, and smart phones there are many unique and profitable freelance opportunities that earn extra income. The advantages are that you can often start them while still employed to gain experience and build your reputation.  After retirement you can devote as much time as desired to earn the level of income or activity that you seek.  Many new retirees leave without knowing exactly what they will be doing and become bored and frustrated.  What will you do in retirement? These freelance activities provide an outlet for retirees to continue to be active and productive and earn additional income along the way.   

The new freelance opportunities range from writing for web sites to what they call micro jobs, work offered by hundreds of companies to gather information they need from YOUR community.  These are legitimate jobs involving individual freelance work to field work for companies that need information that is most often collected with your Iphone or smart phone camera.  Some photographs must be of a higher quality and for those projects you will need a DSLR camera. Microsoft uses these services to provide the photos for their Bing searches.

You can divide the freelance work into several categories:

  • Writing –  supplying articles to websites on diverse subjects that are of interest to other
  • Micro Projects – Supplying site specific Information or photographs  to companies that require either images or general information about your area

These freelance jobs can help you turn your extra time into cash and it doesn’t take a lot of expensive equipment or prior experience to succeed.  

Freelance Writing Assignments

Many web sites buy articles on varied and diverse subjects and some even pay by page views which can significantly increase your income over time. Federal employees and retirees have a wealth of information to share and these websites offer you the opportunity to capitalize on those many years of experience. Why not share what you know with others and receive payment at the same time! These assignments also provide an outlet for retirees to get out and about in their communities and explore interesting venues for their article research.

Here are several sites that you can explore for writing assignments:

  • http://www.demandstudios.com/ buys and publishes these articles on EHow.com, LIveStrong.com and USAToday.com. Writers receive from $15 to $30 per article through Paypal. There is also a revenue share program where you get paid by page views and other criteria. You must first apply online and submit a sample how-to article. Approval takes up to several days. Basically you sign up for a specific title from a list of thousands provided on their site and you have seven days to complete the article. Articles must be researched with sources identified.  An editor reviews your work and they may require a rewrite and they give you 4 days to resubmit the revised article.  Pay special attention to their article format requirements.  You can also apply for copy editing and video production work from home opportunities.  Their FAQ page will answer any question you may have about their programs.
  •  Yahoo Voices at https://contributor.yahoo.com/signup purchases articles either under assignment or through what they call Up-Front offers ranging from $2 to $100 plus you will receive performance payments based on page views.  If your content is distributed to a third party you will also receive a flat distribution payment. You can write about any subject you wish or accept specific content assignments; either way you will earn income from multiple sources.  You have to have a Yahoo user ID to register for their contributor network. Explore their GAQ page and sign up to get started.
  •  www.Helium.com also purchases articles and have numerous revenue streams for writers. Your earnings are based on stock content, incentive payments, web traffic and advertiser interest plus others. You can write about any subject. Visit their FAQ page for additional information.  Your payment varies based on user interest.   

Micro Projects

Over 250,000 nationwide have turned their free time into cash through Gigwalk.  Gigwalk farms out projects to freelancers from thousands of companies. View their introductory video that shows how the service works.  An Iphone is required and you simply download their free app to register and get started.  You will be paid anywhere from $7 to $90 to complete tasks such as verifying specific information, reviewing local restaurants or retail outlets, or take photographs of active projects or locations in your community.  After you register and are approved they will notify you of new projects in your area.

Another option is TaskRabbit where you can perform just about any type of task from shopping to assembling furniture in your community. According to TaskRabbit, college students, recent retirees, stay-at-home moms, young professionals—TaskRabbits are quite literally the people in your neighborhood. They dedicate their time and talents to getting your To-Do list done. Retirees can also find service providers for their to-do-list here. You can benefit both ways with this service. Visit their website at https://www.taskrabbit.com/how-it-works to see if this would work for you.

FREE Career Planning Guide for federal Employees

Take Charge of Your Federal Career is a practical, action-oriented career management workbook that assists employees with the preparation of realistic Individual Development Plans (IDPs). Packed with proven tips and valuable assessment and evaluation tools, this unique workbook provides federal workers with the individualized know-how and guidance they need to identify, obtain, and successfully demonstrate the skills and experience required to qualify for new and better federal jobs. I wrote this book based on my 36 years of federal work experience.  We are offering 30 copies, one case of books, to federal training offices and supervisors for $84, the cost of shipping and handling, to introduce agencies and federal offices to this succinct career planning workbook.  Pass this on to your training departments and supervisors in your unit. The book is 8 ½” x 11” 216 page perfect bound workbook that will help federal employees plan their careers. Order online or call 800-782-7424. Ask for Special Offer IDP-1432. 

Recent Forum Host Articles:

Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at  https://fedretire.net to read all forum articles.

Visit our other informative sites

Helpful Retirement Planning Tools
Distribute these FREE tools to others that are planning their retirement

The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in EMPLOYMENT OPTIONS, ESTATE PLANNING, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SURVIVOR INFORMATION

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Retirement Challenges & Planning Assistance

Posted on Friday, 17th May 2013 by

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Many obsess about what they will do in retirement and fear finding out too late – after they retire – that retirement isn’t for them. Most retirees discover early on that their time remains a cherished commodity and you will wonder how you ever worked and got anything done.

I’ve been retired going on 9 years now and this past year has been a blur.  We moved, sold our previous home ourselves savings thousands in real estate commissions, and we spent a year getting things organized and updated in our new home.  Plus we were blessed with our first grandchild in January and our daughter just announced her engagement. All in all my retirement has worked out well for my wife and I however there were many speed bumps along the way.

Retirees have the time to explore, manage projects like selling your home by owner, remodeling  projects, researching the best place to move to or vacation in retirement, rediscovering a hobby or interest, or simply learning how to best manage your TSP and finances now that you are retired and most likely living on a fixed income. I still find that I don’t have the time to do all that I desired mostly because I’m still managing my business and always researching one thing or the other. Life gets in the way and there are always things to do places to go, and people to meet and the nice thing about retirement is that YOU can tailor it to whatever you choose within reason.

What I like about retirement is that I can devote the time to interests unencumbered by the limitations you had while employed by others who managed your time to their advantage. Now, in retirement you determine what’s important, when to do it, how much of your time and resources YOU will devote to it. Retirement gives you freedom to pursue whatever you choose as long as you are in good health and had the foresight to save and plan for this life changing event.   Here are a few helpful articles and reports that you can use to effectively plan for your retirement:

One of my most interesting projects recently was selling our home through a For Sale By Owner (FSBO) program saving us thousands of dollars in real estate commissions. I will discuss this in depth in an upcoming article. Over the past 40 years I’ve sold 5 homes successfully through this route. Actually, it isn’t a difficult process as many realtors would have you believe especially with the new services offered by FSBO companies. One rather aggressive realtor called several times to tell me about the advantages of listing our home with them. Each time she called I reminded her that her company was listing a similar home just 8 houses down the street from mine.  I asked her why that home hasn’t sold yet with all of the advantages she proclaimed for her services!  We sold our home a month or so before the similar property down the street sold.  I held numerous open houses, used a local MLS lock box so I wouldn’t have to be there for showings, and our home was listed on the local MLS and on Realtor.com.

Federal employees are fortunate to have generous CSRS and FERS retirement and the THRIFT Savings Plan (TSP) plan to fall back on.  Both combined with Social Security can make your retirement financially secure. Unfortunately, I talked with several younger workers recently that aren’t contributing to their TSP.  I don’t think they realize just how important it is to fund their TSP accounts and increase their contributions yearly so they too will have a solid foundation to fall back on when they retire.

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Request a FREE Retirement Benefits Summary & Analysis from a local adviser. A sample analysis is available for your review. Includes projected annuity payments, income verses expenses, FEGLI, and TSP projections. This service is not provided by www.federalretirement.net.

Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at  https://fedretire.net to read all forum articles.

Visit our other informative sites

Helpful Retirement Planning Tools
Distribute these FREE tools to others that are planning their retirement

The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, FINANCE / TIP, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE

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Reassessing Retirement Assumptions

Posted on Monday, 13th May 2013 by

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What makes financial sense for some baby boomers may not make sense for you.

Provided by Paul H. Risser

There is no “typical” retirement. Many baby boomers want one and believe that they will have one, and their futures may indeed unfold as planned. For others, the story will be different. Just as there is no routine retirement, there are no routine financial moves that should be made before or during this phase of life, and no universal truths about the retirement experience. 

Here are some commonly held assumptions – suppositions that may or may not prove true for you, depending on your financial and lifestyle circumstances.  

#1. You should take Social Security as late as possible. Generally speaking, this is a smart move. If you were born in the years from 1943-1954, your monthly benefit will be 25% smaller if you claim Social Security at 62 instead of your “full” retirement age of 66. If you wait until 70 to take Social Security, your monthly benefit will be 32% larger than if you had taken it at 66.1

So why would anyone apply for Social Security benefits in their early 60s? The fact is, some seniors really need the income now. Some have health issues or the prospect of hereditary diseases influencing their choice. Single retirees don’t have a second, spousal income to count on, and that is another factor in the decision. For most people, waiting longer implies a larger lifetime payout from America’s retirement trust. Not everyone can bank on longevity or relative affluence, however. 

#2. You’ll probably live 15-20 years after you retire. You may live much longer, especially if you are a woman. According to the Census Bureau, the population of Americans 100 or older grew 65.8% between 1980 and 2010, and 82.8% of centenarians were women in 2010. The real eye-opener: in 2010, slightly more than a third of America’s centenarians lived alone in their own homes. Had their retirement expenses lessened with time? Doubtful to say the least.2

#3. You should step back from growth investing as you get older. As many investors age, they shift portfolio assets into investment vehicles that offer less risk than stocks and stock funds. This is a well-regarded, long-established tenet of asset allocation. Does it apply for everyone? No. Some retirees may need to invest for growth well into their 60s or 70s because their retirement savings are meager. There are retirement planners who actually favor aggressive growth investing for life, arguing that the rewards outweigh the risks at any age.

#4. The way most people invest is the way you should invest. Again, just as there is no typical retirement, there is no typical asset allocation strategy or investment that works for everyone. Your time horizon, your risk tolerance, and your current retirement nest egg represent just three of the variables to consider when you evaluate whether you should or should not enter into a particular investment.

#5. Going Roth is a no-brainer. Not necessarily. If you are mulling a Roth IRA,  Roth 401(k), or Roth TSP conversion, the big question is whether the tax savings in the end will be worth the tax you will pay on the conversion today. The younger you are – roughly speaking – the greater the possibility the answer will be “yes”, as your highest-earning years are likely in the future. If you are older and at or near your peak earning potential, the conversion may not be worth it at all.

#6. A lump sum payout represents a good deal. Some corporations are offering current and/or former workers a choice of receiving pension plan assets in a lump sum payout instead of periodic payments. They aren’t doing this out of generosity; they are doing it because actuaries have advised them to lessen their retirement obligations to loyal employees. For many pension plan participants, electing not to take the lump sum and sticking with the lifelong periodic payments may make more sense in the long run. The question is, can the retiree invest the lump sum in such a way that might produce more money over the long run, or not? The lump sum payout does offer liquidity and flexibility that the periodic payments don’t, but there are few things as economically reassuring as predictable, recurring retirement income. Longevity is another factor in this decision.

#7. Living it up in your 60s won’t hurt you in your 80s. Some couples withdraw much more than they should from their savings in the early years of retirement. After a few years, they notice a drawdown happening – their portfolio isn’t returning enough to replenish their retirement nest egg, and so the fear of outliving their money grows. This is a good argument for living beneath your means while still carefully planning and budgeting some “epic adventures” along the way.

Your retirement plan should be created and periodically revised with an understanding of the unique circumstances of your life and your unique financial objectives. There is no such thing as generic retirement planning, and that is because none of us will have generic retirements.

Investment Advisor Representative with and Securities and Investment Advisory Services offered through Transamerica Financial Advisors, Inc. (TFA) member FINRA, SIPC and a Registered Investment Advisor. Non-Security products and services are not offered through TFA.

Paul H. Risser may be reached at prisser@tfamail.com, www.risserfinancial.com, or

1-866-274-7737. Paul may also be found on Facebook and Linkedin.

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Investment Advisor Representative with and Securities and Investment Advisory Services offered through Transamerica Financial Advisors, Inc. (TFA) member FINRA, SIPC and a Registered Investment Advisor. LD42774-2/12.

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is not a solicitation or a recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Neither Transamerica Financial Advisors, Inc. (TFA) nor its representatives provide legal, tax nor accounting advice. Persons who provide such advice do so in a capacity other than as a registered representative of TFA.

Citations.

1 – www.forbes.com/sites/janetnovack/2011/02/15/the-big-decision-when-to-take-social-security/ [2/15/11]

2 – money.usnews.com/money/retirement/articles/2013/01/07/what-people-who-live-to-100-have-in-common [1/7/13]

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Posted in BENEFITS / INSURANCE, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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Social Security Update, Medicare Concerns, & Retiree Jobs

Posted on Friday, 3rd May 2013 by

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Norma, a federal employee that elected to collect Social Security while still working, commented on my last article on this subject.

She stated that while it is true you don’t decrease social security benefits if you are still working at age 66 or older you may be subject to taxes on some of the social security money you receive.

She states, “People will have to pay Federal taxes on their Social Security benefits if you file a Federal tax return as an individual and your total income is more than $25,000.  If you file a joint return, you will have to pay taxes if you and your spouse have a total income of more than $32,000. So I, for instance, have to pay taxes on anything I make over $32,000. The good news for getting around this is to max out your TSP with whatever you are getting for social security. If you are already maxed out you will end up paying additional taxes.”

It’s been costing Norma $5,000 to $7,000 in taxes a year because she initially didn’t put extra into her TSP account. However, this year she will owe nothing for social security when she does her federal taxes because she increased her TSP contributions for 2013.

The other good news is that each year you work while collecting you get an increase in your social security (Norma is getting about $45) as they drop her earliest years she worked and add the latest year.  This is in addition to the cola.  So by the time she reaches 70 Norma basically gained the 8 percent or so she would have received had she not started collecting.

Medicare Discussion (Part A and B)

Norma also provided insight into Medicare B (Medical Insurance). Norma had health expenses three years ago and signed up for Medicare B while still working. Now she has to pay the Medicare B plus her Blue Cross FEHB premiums.  She wasn’t sure how Medicare B affected her FEHB plan.  Since she is still working Blue Cross is her primary insurance and she is paying for Medicare (which also has a deductable) however only Blue Cross pays for her insurance.  She stated that, “Medicare to date has paid about $30.00 dollars over three years and until I retire and it becomes my primary I am wasting money paying the monthly premium.”

Many federal employees and retirees approaching age 65 are confused about Medicare; especially Medicare B and if it is worth paying the additional cost for Medicare B coverage when you have FEHB coverage.  If you are still working at age 65 and beyond your FEHB coverage is primary. When you retire at age 65 or older Medicare becomes your primary provider if you signed up for it and your FEHB plan becomes your supplemental coverage.

Note:  You don’t have to take Part B coverage if you don’t want it, and your FEHB plan can’t require you to take it. But, there are some advantages to enrolling in Part B. For example, you have the advantage of coordination of benefits between Medicare and your FEHB plan, reducing your out-of-pocket costs; your FEHB plan may waive its copayments, coinsurance, and deductibles for services and covered by Part B and some services covered by Part B might not be covered or are only partially covered by your plan, such as orthopedic and prosthetic devices, durable medical equipment, home health care, and medical supplies (check your plan brochure for details).

The FEHB health plan brochures explain how they coordinate benefits with Medicare, depending on the type of Medicare managed care plan you have. If you are eligible for Medicare coverage read this information carefully, as it will have a real bearing on your benefits.

The decision to enroll in Medicare is yours. OPM encourages you to apply for Medicare benefits 3 months before you turn age 65. It’s easy.  Just call the Social Security Administration number 1-800-772-1213 to set up an appointment to apply. If you do not apply for one or more Parts of Medicare, you can still be covered under the FEHB Program. Visit their website for forms and additional information.

If you can get premium-free Part A coverage, OPM advises you to enroll in it. Most Federal employees and annuitants are entitled to Medicare Part A at age 65 without cost. When you don’t have to pay premiums for Medicare Part A (Hospital Insurance), it makes sense to obtain coverage. It can reduce your out-of-pocket expenses as well as costs to FEHB, which can help keep FEHB premiums down.

Generally, plans under the FEHB Program help pay for the same kind of expenses as Medicare. FEHB plans also provide coverage for emergency care outside of the United States which Medicare doesn’t provide. Some FEHB plans also provide coverage for dental and vision care.

For more information about your Medicare options review the resources and articles on our Medicare pages. You will find them very informative and helpful, especially links to OPM’s FEGLI and Medicare Booklet and Tammy Flanagan’s 3 part series on this subject.

Retiree Job Opportunities

Many companies and state government departments recently posted jobs on our site to attract federal retirees. You will find jobs ranging from ADT Security Services, Bank teller and client services, FLSA Classifier, research, sales and everything in between. Most are part time and you can tailor you hours to your routine.  Many other opportunities exist for those looking to supplement their retirement income or to start a second career.  We provide this free job listing service to companies that are seeking to hire experienced retired federal workers.

Recent Forum Host Articles:

Request a Retirement Benefits Summary & Analysis from a local adviser. Includes projected annuity payments, income verses expenses, FEGLI, and TSP projections. This service is not affiliated with www.federalretirement.net.

Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at  https://fedretire.net to read all forum articles.

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The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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

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Collecting Social Security While Still Working and CSRS Offset Concerns

Posted on Friday, 12th April 2013 by

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A site visitor to one of our forums stated that she was 66 and still working and was CSRS offset. A colleague suggested that she think about drawing social security now versus waiting until she retires. Once you reach age 66 you can earn unlimited amounts without reducing your Social Security benefit. She had been giving the matter some thought in terms of the pros and cons.

She stated, “It seems to be the obvious pros would be to have the money now since none of us know how many years we will be able to collect and having the extra money now would enable me to increase my contributions considerably to the TSP.  The obvious con seems to be that if left untouched, the social security will increase 8% each year until I reach age 70.  It’s difficult to find any savings vehicle that would match 8%; while some of the funds in TSP have had years of growth larger than 8%, it’s still the stock market (except for the G fund which has growth of under 5%) and therefore there is no guarantee that the extra money invested would gain 8% or more and could just as easily lose money, depending on the economy & world events.

Any thoughts or pros and cons I’ve overlooked?  I realize it comes down to a personal decision but I’m trying to study all facets of the issue before deciding one way or the other.  I know, of course, that I don’t have to make a decision right now.  I am not sure how much longer I will work before retiring – at the earliest, January 2014 but I may delay it until 2015 or later.  I’m just not sure.”

Reply: Since you are at the full retirement age, the decision is basically whether to receive funds now or a greater amount later.  If we knew how long the retirement funds needed to last this would be an easy answer.  I would estimate each annuity amount (payable at 66 and at 70) and how long you would have to live to make up the difference if you wait until you are 70 to collect the higher benefit.

Sometimes the decision is not about us alone, but also about a spouse’s income as well.  For example, a married couple may elect for the lower wage earner to receive Social Security early and the higher wage earner who is still working and adding significant income to the calculation to wait.  This way if the person earning more money retires at age 66 or older the spouse can then elect the higher spousal benefit or if they die, the spouse can opt to receive the larger annuity of the higher earner.

One other thing to consider is if this would allow you to put more away in your TSP account.  After you retire, you cannot contribute money to a 401k or an IRA because deposits must come from wages.  Your beneficiaries can inherit an IRA or 401k, but usually only the spouse can receive Social Security benefits.  If you are already contributing the maximum to your TSP, this may not be a consideration.

You may want to hire a certified financial planner to review your situation in detail to provide more specialized advice in your situation.  They can look at the cost of your debt, your contribution amount to TSP, your Social Security income and your life expectancy.

Recent Forum Host Articles:

Request a Retirement Benefits Summary & Analysis from a local adviser. Includes projected annuity payments, income verses expenses, FEGLI, and TSP projections. This service is not affiliated with www.federalretirement.net.

Learn more about your benefits, employment, and financial planning issues on our site and visit our Blog frequently at  https://fedretire.net to read all forum articles.

Visit our other informative sites

Helpful Retirement Planning Tools
Distribute these FREE tools to others that are planning their retirement

The information provided may not cover all aspect of unique or special circumstances, federal regulations, and financial information is subject to change. To ensure the accuracy of this information, contact your benefits coordinator and ask them to review your official personnel file and circumstances concerning this issue. Retirees can contact the OPM retirement center. Our article is not intended nor should it be considered investment advice and our articles and replies are time sensitive. Over time, various dynamic economic factors relied upon as a basis for this article may change. The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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

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