Medicare and Social Security

[SkyPilot]

Aha! This is what I suspected, and good information to evaluate the value of Part D for FEHB BCBS plan participants.
The US Office of Personnel Management (OPM) has determined that the Blue Cross and Blue Shield Service Benefit Plan prescription drug coverage is, on average, expected to provide as much as the standard Medicare prescription drug coverage in terms of benefits. Therefore, you do not have to enroll in Medicare Part D and pay extra for prescription drug coverage. If you do decide to enroll in Medicare Part D, we will coordinate benefits for prescription drugs with your Part D coverage.

Page 12

http://www.fepblue.org/downloads/2013_medicare_and_you.pdf

 

[nasa1974]

Aha! This is what I suspected, and good information to evaluate the value of Part D for FEHB BCBS plan participants.
The US Office of Personnel Management (OPM) has determined that the Blue Cross and Blue Shield Service Benefit Plan prescription drug coverage is, on average, expected to provide as much as the standard Medicare prescription drug coverage in terms of benefits. Therefore, you do not have to enroll in Medicare Part D and pay extra for prescription drug coverage. If you do decide to enroll in Medicare Part D, we will coordinate benefits for prescription drugs with your Part D coverage.

Page 12

http://www.fepblue.org/downloads/2013_medicare_and_you.pdf

Good info. Thanks SkyPilot.

 

[nnuut]

No more Social Security at 62?


By Jennie L. Phipps · Bankrate.com


Read more: No more Social Security at 62? « Bankrate, Inc.

 

[nnuut]

Austerity is raising it's ugly head! Well, cut my legs off and call us Greece.
Jimmy Carter started screwing Government workers and these guys will finish the job.

[h=1]Senators Propose to End Defined Benefit Pensions for New Federal Employees[/h] by Ian Smith | November 13, 2013

Senators Propose to End Defined Benefit Pensions for New Federal Employees - FedSmith.com

 

[Birchtree]

The money in a defined benefits pension plan is not the employees - it's just a promise that can be changed. A defined contribution is much better - the money sum is yours and cannot be altered. Everyone will need to become more cognizant of investing for their retirement. I'm in favor of these plans.

 

[Scout333]

Just a quick question for FERS retirees, do you believe you were better off with the TSP and the 5% match, and supplements, etc or think you would have been better off with the CSRS annuity and no match? Seems a little hard to compare since they are so different.

 

[nnuut]

Lets look and see who is writing & pushing this legislation

Senators Richard Burr (R-NC), Tom Coburn (R-OK), Saxby Chambliss (R-GA)

This isn't a political thread...so I'll just rhetorically ask if anyone sees something in common with the 3 "crafters" of this plan?

Hint: Its the same group that has been whittling away federal benefits for decades...since Reagan cut off CSRS for new hires.

Do you know why there are only Republicans on that list? Because they know we are going broke and something has to be done, the Dems wouldn't dare try and save our economy they would lose votes.

 

[Bquat]

Just a quick question for FERS retirees, do you believe you were better off with the TSP and the 5% match, and supplements, etc or think you would have been better off with the CSRS annuity and no match? Seems a little hard to compare since they are so different.

The other system was better unless you do 15% of your own money and trade well. We my be better off when they drop all of them from being eligible for Social security as a last ditch effort to balance budget a couple years from now. Just a rumor. Soon everyone under FERS will have to wait until 62. No SS supplements soon,Whine over.

 

[nnuut]

Just a quick question for FERS retirees, do you believe you were better off with the TSP and the 5% match, and supplements, etc or think you would have been better off with the CSRS annuity and no match? Seems a little hard to compare since they are so different.

I remember being asked twice if I wanted to switch from CSRS to FERS, I declined both times. I made the right decision.

 

[Kaufmanrider]

The other system was better unless you do 15% of your own money and trade well. We my be better off when they drop all of them from being eligible for Social security as a last ditch effort to balance budget a couple years from now. Just a rumor. Soon everyone under FERS will have to wait until 62. No SS supplements soon,Whine over.

I hired a few years after FER's started. I believe CSRS was better, but I just did a quick calculation of my retirement benefits under each and I am not so sure. I retire Jan 11, 2014.

CSRS would give me $13,500 more annually, give or take a couple dollars, than my FERS and SS Supplement together will provide. Using my TSP account balance as of today to receive life expectancy monthly payments (which I don't plan to do yet) my annual pay would be about the same as CSRS.

CSRS gets better annual COLA's, but I'll get an increase in my SS when I apply for full benefits down the road. And as a LEO, I will get COLA's annually.

As BQUAT said, TSP is key.

Bquat, not everyone in FERS under 62 will lose SS supplements. Those under mandatory retirement (LEO/ATC/FF) will keep the supplement according to the reports I have read.

 

[Frixxxx]

Here's a quote from these a$$ clowns...giving the REAL REASON they're proposing this:
The Senators said in a press release that federal employees currently enjoy a costly benefit that is unavailable to the average private sector worker which is creating an untenable cost burden for taxpayers. “Federal workers enjoy both a defined benefit pension and a Thrift Savings Plan (equivalent to a 401(k)) with up to a 5% match, paid for by the taxpayers. The average private sector employee gets a 401(k) with a 3% employer match and no pension. Federal workers also continue to enjoy federal health care benefits (FEHBP) after they retire, a benefit that is becoming increasingly rare in the private sector,”

Amazing how the program FERS was generated based on what the private sector was paying back in the 80's.

This link shows how a bipartisan group came up with FERS and how it was constructed:

Link

Many other studies were presented to show the math. But I have no time in my schedule to research that deep.

 

[jaybro61]

Hi guy. In answer to your Q. I live in both worlds. I retired in 1/08 with 21yrs. csrs and 9 with fers. 30yrs. 3mos. I sign up for SS in feb. My supplement goes but the SS comes. Hopefully its more than the former! Enjoying gaining and some losing in the market with TSP!

 

[jaybro61]

Anytime the FED offers you alternatives; run! My bluecross Fed is around 5k/yr. Not great but sufficient. Dental is extra!

 

[PLANO]

The money in a defined benefits pension plan is not the employees - it's just a promise that can be changed. A defined contribution is much better - the money sum is yours and cannot be altered. Everyone will need to become more cognizant of investing for their retirement. I'm in favor of these plans.

Me too. Defined contribution is the way to go and I wish we had that option instead of Social Security as well. If we owned our social security accounts and could invest them we would have a lot more money in retirement than social security currently pays. Its a typical liberal government program that is inefficient and too costly.

 

[alevin]

Interesting footnote from your link:

On pg 7 those making the case against CSRS said it was too costly compared to private industry retirment plans:

"A preliminary design study, performed for OPM by consulting actuaries and reported--28 percent of pay for CSRS and 17 percent for a "typical nonfederal" plan"

However, Senator Al Gore Jr objected to that analysis...and for very good reason:
"But when Sen. Albert Gore, Jr., questioned this, GAO added that 25.1 percent was the figure from the same study for large companies with work forces closer in size to the federal civilian work force."

I would have liked to have had the security of CSRS (and not have the FICA SS taxes) AND the capability to invest 5-10% of my cash tax free into a TSP like vehicle.

Funny, when I was presented the choice of CSRS vs FERS (yes. I was offered a choice), I don't recall being advised that I could also invest in tsp at the same time. unfortunately I was still in grad school on career conditional appointment and didn't know enough to make decision other than job insecurity (30 year career? really?) I couldn't imagine that for myself at the time, even tho parent was a career CSRS kinda guy who had already retired at that point-he took a buyout then, had his MRA but went out with less than 30 years on a directed reassignment-RIF.

Having a backup plan (tsp) for job insecurity was a big argument for me in late 80s to go FERS instead of CSRS based on my own job hunts in the 70s and 80s prior to getting on board the gov. I didn't get the details on the directed reassignment/RIF early-out deal from my dad until just a few months ago but I knew he'd sweated a RIF a few years earlier than that also-which factored into my decision.

 

[alevin]

Yeah Alevin,
Definitely pro's and cons for each one.

Not sure if you'll be working for the feds for yur entire career? Then FERS is better.
Also if you plan on working into your mid 60's or longer, FERS might be better deal.

Out & Alive at 55...or 60...then CSRS is better.
Catching the stock market on the wrong end of the secular bull/bear market....or ones investing choices not the best...CSRS better deal.

Yes, so figure somebody like me when I was already 27, career conditional still, and not going to hit the big 30 til I was 60. 50/50 coin toss it was for me, wish Yoda had been around back then.

 

[burrocrat]

the disturbance you feel in the force, luke, is that there is no there there.

social security and csrs and even fers cash is charged to your payroll before you ever see it and put into a trust fund for later use. except that it is promptly borrowed against and replaced with a treasury bond (iou) and immediately spent for current extravagances. so the crying song goes like this: i saved my money, then i voted for politicians who spent my money on feel good things like fixing the world, and now i want to know where is my money?

the boomers broke the bank, it just hasn't closed its doors yet. there is no asset to liquidate to repay the notes. except for the future revenue stream generated by the production of young workers. the only way it is solvent is if two things happen: 1) more young producers contribute now in exchange for a promise to get paid later, and 2) recipients get frugal and don't take too much. neither will happen voluntarily. that's why we have government.

social security, csrs, and fers are all relatively good deals, as long as somebody else is paying for the ticket. debating the preference of one over the other only makes sense if you are sure the check won't bounce. few folks have that luxury these days. rice, and mud huts. get some.

 

[alevin]

Generations that came before created the institutions we're talking about, and have benefited from the boomers paychecks. promises were made to late boomers and those that came later, those promises won't be kept, not in full if at all, agreed. Boomers may have been the naive do-gooders but only part of the problem. GenX-they've played a role as well-who played the housing market with all the low/no doc loans?

I see the late boomers/early genX being caught in the transition point from what was to what is coming, yes. See my sig. At least the nothing that we end up with will be transportable. :suspicious: All the more reason to have Roth account, as a priority over fully funding tsp catchup, when $ don't stretch to fully cover both.

 

[jimijr]

It's an old thread but I turn 65 in 6 months, therefore I am being bombarded with offers for health insurance! The whole world seems to know I am soon to be eligible for Medicare and would I care for any additional health insurance?

It was a quandary until I reduced it to an inequality like SS itself. In SS you can take it 'early' at 62 and get 2/3rds or wait until 'full retirement' and get it all. Work it out and you will see you must wait until ten years after 'full retirement' to break even. I took it 'early' after I consulted the actuarial tables.


In Medicare you get Part A free so no consideration there. Part B you pay X dollars for monthly. Part B replicates what I get from BCBS and costs a lot less but applies only to me. (If I took it I would still have to carry BC for my younger wife, canyadigit?) Not taking Part B incurs a 10% per year penalty on the premium should one decide to take it later. Supposing we planned to go on Medicare completely once she is eligible 5 years hence, should I sign up now and pay for nothing or should I wait and incur the penalty?

The answer is in the 10% penalty. It equates to ten years payout before you break even, just like SS. That is, if I take Part B now and pay the premiums meanwhile, it will be ten years after wifey turns 65 that we begin to see any cost savings.

Answer is, don't take Part B now, take it later if at all. I'll be 80 years old before the inequality turns against me and I don't think I'll care much one way or the other at that stage.

FERS/CSRS: I am FERS and happy. SS about equals my pension and the TSP kicks in 40% of my annual income. I have more pocket money now than when I was working.