Retirement Talk

[Spaf]

Clarify what it was that got your attention here....
thanx -

I'll send U a PM. Because, various agencies apparently treated this subject differently. I can only present my experience!

 

[Spaf]

Income Status under FERS​

Here is about what one can expect, time wise, from a FERS retirement system (plus related others).

Note: Social security sends out checks based on your birthday. Generally, the day in the month on which you receive your benefit depends on the birth date of the person on whose record you receive benefits. For example, if you receive benefits as a retired or disabled worker, your benefit will be determined by your birth date. If you receive benefits as a spouse, your benefit payment date will be determined by your spouse's birth date.

Here's how it works:

Birth date on.....Benefits paid on
1st - 10th........Second Wednesday
11th - 20th......Third Wednesday
21st - 31st.......Fourth Wednesday

For example, your date of birth is June 16. Your monthly retirement check will be paid on the third Wednesday of every month.

VA checks........1st day of the month.
FERS annuity....1st day of the month
Social Security..see above

I elected to have monthly payments from TSP. The 1st check was recieved on the 24th of the month.

All items above are applicable to/for direct deposit.

Regards, and be careful!.............. .................Spaf

 

[ocean]

Spaf,

Thanks for the info. I noticed some of you are already retired now. Since there is a thread for retire planning. Do you think if it is a good idea to start a thread for Retired Living?

For folks already retired so they can talk about what their routines are and what area of interest they are doing or things like that. It may help us to prepare what to expect after retirement since the number of baby boomers going to the retirement becomes larger and larger. Thanks.

Ocean

 

[Spaf]

Ocean,
Good idea! We can do that!........:nuts: ..............Spaf

 

[Spaf]

So far so good!​

About 5 years ago I kind of got serious with my retirement.
OPM booklets said that one could retire at 60. Social Security had a birth day / age threshold.

Doing backwards math I recieved information on the government annuity, social security, and TSP. Then figured where I wanted to retire and under what conditions. Using savings and sales, we made a re-location and a re-financing, using guideline from our accountant.

We wanted to retain 100% of normal income, 50% expenses and 50% free.
Was this possible?............Yes it was.

Retiring at age 60 was not possible, because of deductions and the Supplemental.

Retiring at age 62 was possible!

All figures fell in line including a minimum risk for TSP. Risk vs reward.
Most guidelines allow for a maximum of 4% withdrawl from a savings plan (IRA), and most guidelines figure an inflation factor of 3%. Thus TSP funds should be allowed to increase about 7% a year. The actual withdrawl figured at 3.5% per year + 3% inflation resulted in a benchmark gain of 6.5% required to maintain that fund in the cost of living (COLA) retirement triad.

In a bear market the G-Fund will let one survive, in a bull market it is the risk one can accept which has to be conservative in capital preservation once retired.

A big advantage with TSP is the ability to put aside savings regularly, have matching funds, have funds with low expenses and good indexed funds. Plus the options of loans, annuities, payments, and withdrawls.

The big advantage of TSPTalk is learning how to minimize risks and take avantage of rewards in strategy that fits a person's life. Plus sharing ideas that respect the principal of managing a retirement savings plan, and not leaving it up to the whims of the mystical unknowns (some one or some company that does not have your interest as primary). I can play high risk with "stops" or sit back on a lilly pad with the G-Fund and not risk one penny of the principal. Or, I might just decide to go fishing!....:nuts:

Bottom line: Does TSPTalk work / help?....... I gotta say Yes!..... Dats the evidence....

Done been raving enough!
See Ya tomorrow.
Regards and be careful!
Spaf

PS: Thanks Birchtree (Dennis) my boat is now the "Lilly Pad".

 

[ocean]

Spaf,

You gave inspiration and confidence for the rest of us trying to achieve the same goal. Thanks.

Ocean

 

[Spaf]

Well, well, Grenspan , the former Fed chief said....I quote...."the credit crisis is a threat to retirement funds".

Well, a threat is having a gun pointed at U.

A severe injury is being shot with the gun.

Hey, the retirement funds have been shot!.....Not threatened!

Loosing share value is like bleeding! Can't they see the blood on the floor??.....

 

[clester]

One great thing about the Gov't is that pensions are as safe as they can get. I hope!

Anyone under fers, especially ATC, how long was it until you got the annual leave/sick leave payout? OPM says about 6 weeks. Just curious if it may come earlier. Same for FERS and supplement check. If you retire on the 31st of the month, you get the remainder of your regular pay the next pay period and then the 1st? of the next month your first retirement check (about 80% for a few months). Is that realistic?

Thanks

 

[Scout333]

Just noticed that my W-2 reflects no CSRS deductions for the performance award portion for last year (2008). Also, no TSP contributions were taken from this money. Amount is included in taxable wages for Fed. and State. Fed. w/h, state w/h, Social Sec. w/h and Medicare w/h were taken out. TSP is probably not a big deal since that amount could be made up elsewhere. I understand that the high 3 amounts used for computing retirement income for CSRS retirement income do not include performance award amounts.

Does anyone have any knowledge of why this would be the case for CSRS employees? i.e. FERS employees would ??, I believe, get the benefit of the performance award amounts being included in Social Security wages?

 

[Frixxxx]

Just noticed that my W-2 reflects no CSRS deductions for the performance award portion for last year (2008). Also, no TSP contributions were taken from this money. Amount is included in taxable wages for Fed. and State. Fed. w/h, state w/h, Social Sec. w/h and Medicare w/h were taken out. TSP is probably not a big deal since that amount could be made up elsewhere. I understand that the high 3 amounts used for computing retirement income for CSRS retirement income do not include performance award amounts.

Does anyone have any knowledge of why this would be the case for CSRS employees? i.e. FERS employees would ??, I believe, get the benefit of the performance award amounts being included in Social Security wages?

I thought it was only base pay for contributions. Because of the differences of normal pay and the incongruencies with bonus/special/overtime pay, they don't take it out of that.

I work 5-25 hours of overtime every payperiod and my deductions never change.

Check with your benefits person but I think it is specific in the TSP booklet:

http://tsp.gov/forms/tspbk08.pdf

 

[Scout333]

I thought it was only base pay for contributions. Because of the differences of normal pay and the incongruencies with bonus/special/overtime pay, they don't take it out of that.

http://tsp.gov/forms/tspbk08.pdf

Frixxxx, You must be correct since that is the way they handle it. Not such a big deal for TSP contributions since we can adjust our contribution amounts to put an amount in to compensate for nothing being taken out of awards, overtime, etc. if we wish.

The part I am concerned about is the question re. inclusion in high 3 wages for computing retirement amounts for CSRS i.e. 56.25% of average high -3 wages. Inclusion of a $ 2,000 performance award would increase a 30 yr retiree's income by 56.25% of $ 2,000 or $ 1,125 annually till death do us part. I believe actuarially we would be much better off to have the CSRS contributions (8.45%) or (1.45% for offset employees) taken out and get the benefit of the performance award amounts included in high-3 computations for retirement.

 

[Frixxxx]

The part I am concerned about is the question re. inclusion in high 3 wages for computing retirement amounts for CSRS i.e. 56.25% of average high -3 wages. Inclusion of a $ 2,000 performance award would increase a 30 yr retiree's income by 56.25% of $ 2,000 or $ 1,125 annually till death do us part. I believe actuarially we would be much better off to have the CSRS contributions (8.45%) or (1.45% for offset employees) taken out and get the benefit of the performance award amounts included in high-3 computations for retirement.

Unfortunately, not my expertise. If you do find out, let the other CSRS peeps know what is going on. I'm a little ole FERS employee with nothing but time on my hands. Can't even think about retirement!!!

 

[alevin]

Unfortunately, not my expertise. If you do find out, let the other CSRS peeps know what is going on. I'm a little ole FERS employee with nothing but time on my hands. Can't even think about retirement!!!

Annuity is founded on base salary. I'm a FERS baby too-2/3 of the way there-maybe, we'll see when the time gets closer :suspicious:.

OT does not get counted in high-3, cash awards don't get counted into high-3-for anyone, CSRS or FERS either. Temporary promotions do get factored into that year'(s) base. Base salary only. Them's the rules whether we like it or not. Until and unless someone manages to persuade the PTB (Congress) to change them.

 

[Texarkandy]

Annuity is founded on base salary. I'm a FERS baby too-2/3 of the way there-maybe, we'll see when the time gets closer :suspicious:.

OT does not get counted in high-3, cash awards don't get counted into high-3-for anyone, CSRS or FERS either. Temporary promotions do get factored into that year'(s) base. Base salary only. Them's the rules whether we like it or not. Until and unless someone manages to persuade the PTB (Congress) to change them.

Note: AUO & LEAP pay (types of overtime) do get counted in the Hi-3 for Fed Law Enforcement Officers retiring under CSRS 6c & FERS 12d retirements.

 

[Scout333]

Apparently this is based on old regulations defining what high-3 pay does and does not include. Do we have any OPM folks in the house who might know about these rules? Probably predates award programs, etc.

 

[CountryBoy]

Annuity is founded on base salary. I'm a FERS baby too-2/3 of the way there-maybe, we'll see when the time gets closer :suspicious:.

OT does not get counted in high-3, cash awards don't get counted into high-3-for anyone, CSRS or FERS either. Temporary promotions do get factored into that year'(s) base. Base salary only. Them's the rules whether we like it or not. Until and unless someone manages to persuade the PTB (Congress) to change them.

alevin,

What about the adjustments made to your base salary due to area of the country where you live, counting towards your annuties high 3? Dang, another senior moment, can't remember what this adjusrment is really called. I'm a FERS baby also.

CB

 

[Elgallo]

Locality IS taken into consideration along with your base pay at time of retirement calc.

 

[CountryBoy]

Locality IS taken into consideration along with your base pay at time of retirement calc.

Thanks Elgallo,

Locality was what I was looking for and thanks for clearing up that addition.

CB

 

[alevin]

OK, I didn't know about the LEO rules. You guys are special in a lot of ways.

On the locality pay, I did overlook that part, too focused on special one-time event type pay. One thing I'm unclear on tho, when an active employee moves from a high-locality pay part of the country (DC-say) to an RUS (rest of US) part of the country (for example), employee doesn't get to take the high-local pay bump with him to lower-local pay part of the country.

But a person who retires in DC (for example) gets to keep the DC bump for the long haul, even after they move to a lower locale-pay part of the country? Seems a little odd to me, but if that's true, maybe I should look at doing a tour in DC before I retire. (farthest thing from my current ambitions but not out of the question, just ugh.)

 

[Elgallo]

alvin: There are other high locality areas in the US. I live in the highest, Central CA coast, San Fransisco locality area. Beats DC hands down!

If ever there was a time to move to this area it's NOW. Property values have dropped considerably in certain areas of late. 10 years down the road you would be very happy you bought now.