6 Costly Mistakes Federal Employees Make At Retirement | Christy Capital Management
Вставка
- Опубліковано 5 лют 2025
- Today, we are talking about the six costly mistakes that federal employees make at retirement.
NOTE: Retirement Benefits Institute is now Christy Capital Management:
See our latest federal-focused articles and resources at christycapital...
Here's a breakdown of what we're going to talk about:
1. *Service Computation Date:*
Federal employees often make the mistake of not understanding their service computation date for retirement.
The service computation date for leave and retirement may differ, leading to miscalculations in retirement planning.
Factors such as non-deduction service, refunded service, and military time can impact these dates.
2. *Beneficiary Designations:*
Federal employees need to ensure correct beneficiary designations across various forms, including SF-3102, SF-1152, TSP-3, and SF-2823.
Contingent beneficiaries are emphasized to avoid probate and ensure a smooth transfer of assets.
Outside accounts like IRAs, Roth IRAs, and non-qualified accounts should also have proper beneficiary designations.
3. *Paperwork for Retirement:*
Filling out retirement paperwork accurately is crucial to avoid complications.
Choices regarding FEGLI life insurance, federal health care, survivor benefits, and tax withholding (W-4 form) require careful consideration.
The Retirement Benefits Institute offers assistance in completing paperwork correctly to navigate the complexities of federal retirement.
4. *Understanding Tax Consequences:*
Federal employees need to understand the tax consequences of retirement planning.
Distinguishing between gross and net income is essential, especially when dealing with pensions and TSP balances.
Tax planning should consider different types of money, such as taxable, tax-deferred, and tax-free, to optimize financial strategies.
5. *Detailed Retirement Planning:*
Retirement planning should go beyond relying solely on pension and social security.
Considerations include contributions to TSP, choosing between traditional and Roth options, evaluating the need for life insurance and survivor benefits, and ensuring financial adequacy into advanced ages.
6. *Seeking Specific Federal Benefits Advice:*
Generic financial advice may not be suitable for federal employees due to the unique features of their benefits.
It is crucial to seek specific advice from professionals who understand federal benefits intricacies to make informed decisions.
The Retirement Benefits Institute offers personalized retirement reports to assess net income, estimate TSP balances, and address specific federal benefit concerns.
#FERSretirement #FederalRetirement Christy Capital Management has helped thousands of federal employees as they make plans for federal retirement. For more information about your federal retirement benefits, go to our website at christycapital... to get support.
The information contained in this video should not be used in any actual transaction without the advice and guidance of a tax or financial professional who is familiar with all the relevant facts. The information contained here is general in nature and is not intended as legal, tax or investment advice. Furthermore, the information contained herein may not be applicable to or suitable for the individuals’ specific circumstances or needs and may require consideration of other matters. RBI is not a broker-dealer, investment advisory firm, insurance company, or agency and does not provide investment or insurance-related advice or recommendations. Brandon Christy, President of RBI, is also president of Christy Capital Management, Inc. (CCM), a registered investment advisor.
We have monthly webinars designed to help federal employees prepare for retirement. See what's coming this month at christycapital.com/webinar/
The only mistake I made was not fully understanding FEGLI choices when I retired last July. Had I understood it fully (and it is unnecessarily complicated IMO) I would have opted for full reduction on my Option A and retained my one multiple on my option B. I'll probably drop it by age 70. I finally wrote OPM and took the full reduction on Option A but it cost me around $1200 for five months that gave me no benefit I wouldn't have had anyway had I taken full reduction at retirement.
Be sure you understand FEGLI fully before you change anything, however. The free insurance you get starting at age 65 through Standard and Option A is a really good deal.
FEGLI options in retirement can be tricky! For those of you who are getting ready to retire, listen to this person's advice and make sure you completely understand your options before completing your retirement paperwork.
Very informative. Thank you not many people explain as much
I just retired FERS federal civilian job 34 years under a Vera/VSIP age 55. All of this information should have been explained by the HR department, just say’n no need to pay for advice when it’s right there at your agency. Just ask and most have retirement seminars. I do appreciate your input on beneficiary and contingent beneficiaries. And POD for bank accounts to avoid probate. ✅
Thanks Mel.
You’re welcome 😊
Specific advise should be specific advice. Great video!
Yes! Thank you!
🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣
Thank you
You can avoid some of this by also having a living trust but it is dependent on states.
Every state does have a different set of options!
very informative
Glad it was helpful!
I believe that you can convert to Roth at 59 1/2 by transferring to private, converting, then transferring back into TSP.
According to TSP, they will accept transfers of qualified and non-qualified Roth distributions from an account that is a Roth 401(k), Roth 403(b), or Roth 457(b). However, they will NOT accept Roth rollovers that have already been paid to you and they will NOT accept transfers or rollovers from a Roth IRA.
@@ChristyCapitalManagement I'm talking about the possibility of converting an existing traditional TSP to a Roth TSP.
@@Tolohtony Currently no possibility of converting existing traditional TSP to Roth TSP.
I will keep my option A ins the one that doesnt increase every 5 years, a month before retirement was told that i have prostate cancer. next year my outside ins reaches its 20 year mark and the payment for 250k goes from $41 a month to over $400 a month. to renew or get other ins you got to be cancer free for 10 years . on my option b i will lower that down after 65 when the price goes up.
It sounds like you've got your plan figured out.
Where do you find your Retirement Service Computation Date? Where can you find that date?
Looking at my retirement numbers it looks like I may be living in a van for retirement...
Move to another country. It will be better.
Why do they provide utility hookups for his van. Lol
Thanks for the video. I tried the link for R. B. I. and requested support but I get a 404 error page. It doesn't seem to go through. Also is there a fee for services.
Typically when people have this issue it is due to the internet browser they are using. Our website is not supported by internet explorer; I would recommend trying on another browser such as google or firefox. You can also call 877-864-1145 and ask to speak to Erica and she will be more than happy to assist you. The majority of our resources are completely free but it will depend on the services you seek.
How much withholding does a single person usually put on the application form?
This depends on your personal situation. Your income level and the state you live in can alter the answer to this significantly. We recommend that you contact a trusted CPA for tax advice.
Ty
can you send me those benef forms? ill pay thanks.