Most American workers can look forward to a retirement funded by their own savings (such as a 401k plan) and Social Security benefits. As a federal employee, you have a more comprehensive plan than many; you can claim Social Security, enjoy your annuity payments, and reap the rewards of saving via your Thrift Savings Plan. That adds up to three streams of income in retirement.
But, just because you’re offered some great options, doesn’t mean you’re utilizing them to their full potential. A study conducted by the Navy Federal Credit Union discovered that 36 percent of you haven’t begun saving for retirement. These people have yet to take advantage of their Thrift Savings Plans (TSPs).
The study also demonstrated that those who earn more than $50,000 annually are more than twice as likely to be actively pursuing a defined plan for retirement, when compared to those who earn less. It might seem obvious that those with more money are able to save more, but remember that everyone will retire someday. Even if you can also contribute a small amount to your Thrift Savings Plan right now, the account’s compounding interest can help you money grow. One day you will be glad you made this choice.
On the other hand, even those with a defined plan can be struggling in other ways. Of those who have begun stashing money for retirement, only 42 percent reported feeling well-informed on retirement topics. Others (10 percent) feel completely uninformed, while about half (48 percent) admit they are well-informed but could be making better choices.
So, what do all these numbers mean for you? It’s quite possible that you’re either failing to save for retirement, or the plan you do have could use some improvement. Hopefully, you’re off to a good start, but even “good” plans have room to become “terrific” plans.
If you have any questions about planning for retirement or utilizing your TSP, give us a call. We can help you evaluate your current plan and decide if you could be doing a bit more to adequately prepare for retirement.
