Retirement Choices and Decisions

Nov 1, 2023 | Retirement Planning, Social Security, Thrift Savings Plan

Retirement marks a significant milestone in one’s life. As you approach this transition, it’s crucial to make informed decisions that will shape your financial future. When it comes to federal retirement, there are several key topics that demand careful consideration: survivor benefit options for your pension, the difference between the Federal Employees Retirement System (FERS) supplement and Social Security, Federal Employees’ Group Life Insurance (FEGLI) options, and managing your Thrift Savings Plan (TSP).

Survivor Benefit Options

Planning for the future involves contemplating not just your retirement but also the well-being of your loved ones in the event of your passing. The survivor benefit options for your pension under the Federal Employees Retirement System (FERS) can be complex. It’s essential to understand the various choices available, such as the survivor annuity options, which provide financial support to your spouse or other eligible beneficiaries after your death. Balancing the right amount of survivor benefit with your overall retirement strategy requires careful consideration of your family’s needs and your financial situation.

FERS Supplement and Social Security

Understanding the distinctions between the FERS supplement and Social Security benefits is important for federal employees planning their retirement. The FERS annuity supplement is a retirement benefit for eligible federal government employees who retire before they turn 62. It is designed to bridge the gap between retirement and eligibility for Social Security benefits. In most instances, to be eligible for the FERS annuity supplement, an employee must be age 60 with 20 years of service or retire at MRA with 30 years of FERS service. To calculate your FERS supplement, you must first calculate the monthly Social Security benefit you’d receive if you started collecting at 62. Once you have that number, you can calculate the supplement benefit by dividing your service years by 40 and then multiplying that number by your estimated monthly Social Security benefit.

There are some additional things to keep in mind regarding the FERS Supplement. First, it is subject to an earnings test if you decide to keep working after retirement. Second, once you start receiving the supplement benefits, your eligibility continues until one of two dates; either the last day of the month you turn 62, or the last day of the month before the first month you are entitled to receive Social Security benefits, whichever comes first.

FEGLI Options

Federal Employees’ Group Life Insurance (FEGLI) offers various options to meet the unique needs of federal employees. As you approach retirement, reassessing your life insurance coverage is essential. Understanding the available coverage options, including Basic, Option A, Option B, and Option C, allows you to tailor your life insurance to align with your post-retirement needs. Carefully evaluating these options ensures that you have the appropriate coverage to protect your loved ones and your estate.

New Changes to TSP Management Online

The Thrift Savings Plan (TSP) is a cornerstone of federal retirement savings. Recent changes to TSP management online have introduced enhanced features aimed at providing federal employees with greater control and convenience in managing their retirement investments. In order to save time and be more efficient, these improved online tools for account management enhance educational resources and empower retirees to make informed decisions about their TSP accounts. Staying aware of these updates ensures that federal employees can optimize their TSP portfolios in alignment with their retirement goals.

Looking for assistance in navigating the retirement experience? We can help!

If you are looking for a guide through the retirement process and to put together a financial plan, Benchmark Financial Group can help. It all starts with gathering your information, discussing your goals, and preparing a plan so that we may help you maximize your income in retirement. With the right strategy, you may get your income equal to or exceed your pre-retirement net income. To get started, schedule an appointment today with Benchmark Financial Group by filling out the form online or calling David Raetz at 913-534-8256 to discuss your financial needs. Benchmark Financial Group is happy to help you navigate your options and determine the best path to move toward your financial goals.

*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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