As the year winds down, now is the perfect moment to take inventory of your financial picture, fine-tune your retirement timing, and position yourself for a smooth transition. Whether you’re targeting retirement in 2026 or visualizing your exit within the next several years, a thoughtful, strategic review can help you avoid surprises, maximize benefits, and retire with confidence.
Use this year-end checklist to guide your retirement planning and set yourself up for long-term success.
1. Review Your Federal Service Records
Take time to ensure your personnel and payroll documentation is accurate:
What to check:
✔ Service history – Confirm accuracy of Leave vs. Retirement SCD, buy-back time, military deposit, and sick leave.
✔ Immediate vs. deferred retirement eligibility – Immediate retirement allows continuation of FEHB and FEGLI; deferred or postponed retirement does not. This difference can dramatically affect your long-term financial plan.
✔ SF-50s – Review service dates, position changes, and retirement codes.
✔ FERS creditable service – Ensure all qualifying service is reflected
✔ Military deposit – Verify deposits are complete and paid in full, save the receipt too!
✔ FEHB coverage – Confirm you meet the 5-year requirement for keeping health insurance in retirement.
✔ Sick leave balance – Make sure agency records match your LES.
2. Strategically Evaluate Your Ideal Retirement Date
Your retirement date is more than a personal milestone – it directly impacts your pension, benefits, and cash flow. Retiring at the end of December is a popular choice because it maximizes your lump-sum annual leave payment.
Know Your Key Age Milestones
These ages can significantly influence the value of your FERS benefits:
- MRA – Immediate retirement with 30 years of service
- Age 60 – Immediate retirement with 20 years of service
- Age 62 – Enhanced FERS pension multiplier (1.1% instead of 1%) with 20+ years of service
Why the End of the Month Matters
For FERS employees, timing your retirement can make a meaningful difference. Although you can retire on any day of the month, your annuity doesn’t begin until the first day of the following month. By choosing a retirement date at the end of the month, you ensure your annuity begins the next day—helping to minimize the gap between your final paycheck and your first retirement payment. And if you’ve built up annual leave, your lump-sum payout can provide an extra cushion, making the transition into retirement even smoother.
3. Forecast Your First Year of Retirement Income
Your first year of retirement comes with unique cash-flow considerations. Mapping out your income sources now can ensure clarity and help avoid income gaps as you transition from active employee to OPM retiree.
Plan for:
✔ Final Paycheck – Processed on the expected pay date after your retirement.
✔ Annual Leave Lump Sum – Often paid within weeks of separation; may create a tax bump depending on timing.
✔ Sick Leave Conversion – Know how much added service time you’ll receive toward your pension.
✔ FERS Interim Pay – Expect partial payments until OPM finalizes your full annuity, usually 2-3 months
✔ TSP Withdrawals – Decide how you want to generate income from TSP funds. Do you need a monthly income, periodic withdrawals, or does it make sense to delay distributions?
✔ Social Security – Decide when it makes sense to start Social Security. Start at age 62, or wait until Full Retirement Age?
✔ FERS Supplement – If retiring MRA+30 or 60+20, know your FERS Supplement amount. FERS Supplement has an earnings test, so know how much you can make before that benefit gets reduced.
4. Review and Refresh Your TSP Strategy
As your retirement horizon approaches, even small TSP adjustments can significantly improve your long-term readiness.
✔ Rebalance for the New Year – Market swings may have shifted your TSP allocation away from your target mix. Rebalancing now helps keep your investments aligned with your retirement timeline and ensures your strategy stays on track as you approach retirement.
✔ Maximize contributions (and catch-up contributions if 50+)
✔ Roth vs. Traditional Review – Reevaluate tax strategy based on income, expected tax bracket, and retirement timeline.
Secure Your FEHB & FEGLI Coverage for Retirement
Your federal insurance benefits play a foundational role in retirement – make sure they’re set up correctly.
FEHB (Federal Employees Health Benefits)
✔ Confirm you meet the 5-Year Rule – You must be continuously enrolled for the 5 years before retirement.
✔ Stay Enrolled Through Retirement – Don’t cancel or switch to a non-qualifying plan before separation.
✔ Use Open Season Adjustments to adjust plans based on evolving health needs.
FEGLI (Life Insurance)
✔ Review your current coverage
✔ Evaluate whether FEGLI or private insurance is a better long-term fit.
Take Charge of Your Retirement Now!
Now is the time to take control of your future, whether you’re aiming for retirement in 2026 or planning to step away within the next five years. Don’t wait for surprises – get ahead of them. Start checking off these year-end tasks today so you can build a retirement plan with confidence.
Ready to Put Your Plan into Action?
If you’re ready to turn your retirement goals into a clear, confident plan, Benchmark Financial Group is here to help. We specialize in guiding federal employees through the complexities of FERS, TSP, FEHB, and choosing the right retirement date.
Getting started is easy – visit bfgkc.com/schedule-appointment or call David Raetz at 913-534-8256 to schedule an appointment. Let’s build a plan that helps you step into retirement feeling prepared, confident, and in control of your next chapter.
*Securities and Advisory Services Offered Through CreativeOne Securities, LLC Member FINRA/SIPC and an Investment Advisor. Benchmark Financial Group, LLC and CreativeOne Securities, LLC are not affiliated.
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