Should You Retire? Navigating a Solid Strategy in a Volatile Market

Dec 20, 2022 | Financial Health, Market Conditions, Retirement

If the state of the economy has you questioning whether you should delay your Federal Retirement, it may be a good idea to look at the larger picture.  It’s important to think and understand how the three main sources of income in retirement work. As a federal employee, your three main income sources are your FERS pension, TSP, and FERS Supplement/Social Security. Your FERS pension, FERS Supplement or Social Security are mechanized, the main variable impacting these two are annual Cost-of-Living Increases (COLAs).  The piece of the pie that’s most affected by stock and bond market volatility is your TSP.  Deciding how to maximize your TSP, boils down to figuring out a strategic income plan that fits your individual situation and provides you flexibility.  There are a few items you should be aware of for all three main income sources though.


FERS pension – in most cases, your Cost-of-Living Adjustment (COLA) won’t start until you are age 62.  As an example – if you’re a FERS retiree at age 60, with 20 years of service, your COLAs won’t start for two years.  After you reach age 62, Cost-of-Living Adjustment start increasing your FERS pension payments annually.  The main concern here is if your COLAs don’t keep pace with the increased cost of good and services, causing your purchasing power to go down. If inflation rises above your cost-of-living increases, your FERS pension will start to lag behind. Regardless of stock and bond market volatility though, your monthly pension payments will continue.


With Social Security, it’s a similar story.  Your Social Security COLA is there so your purchasing power can keep up with increases in the Consumer Price Index. However, with the cost of healthcare expenses continually rising, your Medicare part B premiums could go up as well. Higher premiums, which are taken directly from your Social Security benefits, will lower your net income from Social Security.  Regardless of stock and bond market volatility, your monthly social security payments will continue through the ups and downs in the economy though.


TSP is your income stream with the most direct tie to the market.  You can feel more confident in knowing that your pension and Social Security could still provide a solid income in difficult market times. With TSP, you control how you use and invest it. With the right investment strategy, it has the potential to grow at a pace that keeps up with inflation or even faster than inflation, which can help maintain your standard of living. If you are looking for guidance on how to maximize TSP funds Benchmark Financial Group is happy to help guide you through this process.  Setting up a complementary consultation, to take a closer look at your goals, can have a positive impact on your outlook for the future.


The fact of the matter is that there will always be times of difficulty and challenging market conditions, but there is also opportunity. It all starts with a solid strategy and a well-thought-out plan. Looking for help to get the process started? It all starts with gathering your information, discussing your goals, and preparing a plan so that we can help you maximize your income in retirement. With the right strategy, you can potentially get your income to be 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.

9300 W. 110th Street, Ste 160
Overland Park, KS 66210

Webinar Video Library

Access our FREE Webinar Library

Every month we discuss the topics that matter most to you in retirement. Get access to all the latest webinars and learn about what you need to know when preparing for retirement. Enter your name and email below, and we'll send access to our Webinar Video Library directly to your inbox.

Success! Check your inbox for your Webinar Library access information.